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12Apr2017 Market Update: Wall Street Trends Down Moderately, DOW Off 67 Points, Today's Loosing Session Expected To Carry Over Tomorrow, Investors Turning To Safe-Haven Assets

Written by Gary

Major US stock indexes drifted lower today (SPY -0.4%) as investors sought shelter in safe-haven assets amid lingering geopolitical worries, while keeping the upcoming earnings season in sight.


Here is the current market situation from CNN Money

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 68%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear

31%

Investors Intelligence sets the breath Above 50 bullish 64%
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold.

+33.45

StockChart.com NYSE % of stocks above 200 DMA Index ($OEXA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
84%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 66%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 73%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 22.84
StockChart.com Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 87.18
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 11,426

What Is Moving the Markets

Here are the headlines moving the markets.

Wall St down as geopolitical risks trigger rush to safety

(Reuters) - U.S. stocks drifted lower on Wednesday as investors sought shelter in safe-haven assets amid lingering geopolitical worries, while keeping the upcoming earnings season in sight.

Trump's message to bankers: Wall Street reform rules may be eliminated

WASHINGTON (Reuters) - President Donald Trump told a group of chief executives on Tuesday that his administration was revamping the Wall Street reform law known as Dodd-Frank and might eliminate the rules and replace them with "something else."

Exclusive: Meredith falls short of Time Inc's deal price expectations - sources

(Reuters) - U.S. media group Meredith Corp has made a preliminary acquisition offer to Time Inc that fell short of the price expectations of the publisher of Sports Illustrated and Fortune magazines, according to people familiar with the matter.

Exclusive: Inside edge - Trump advisor Icahn's big bet against biofuels credits

(Reuters) - Billionaire investor Carl Icahn's oil refining company, CVR Energy, made a massive bet in 2016 that prices for U.S. government biofuels credits would fall - just before Icahn started advising President Donald Trump on regulations driving that market.

United Airlines faces mounting pressure over hospitalized passenger

(Reuters) - United Airlines and its chief executive faced mounting pressure on Tuesday from a worldwide backlash over its treatment of a passenger who was dragged from his seat on a plane on Sunday to make room for four employees on the overbooked flight.

Airbnb signs dozens more tax agreements in the U.S., France

SAN FRANCISCO (Reuters) - Airbnb has reached new deals with dozens of jurisdictions in the United States and France to collect and pay taxes, doubling down on its effort to improve its image with local policymakers even as it face regulatory challenges around the world.

Monte Paschi CEO says EU demands radical restructuring plan

SIENA, Italy (Reuters) - Monte dei Paschi di Siena is still negotiating with the European Commission how many jobs to cut in a radical restructuring plan that is a condition for a state rescue of the Italian bank, Chief Executive Marco Morelli said on Wednesday.

Greenlight says GM misrepresented stock plan, nominates directors

DETROIT/BOSTON (Reuters) - Greenlight Capital nominated three directors to General Motors Co's board on Wednesday and accused the company of misrepresenting to ratings agencies the prominent hedge fund's proposal to split the automaker's common stock into two classes.

Investors push for changes in Tesla board

(Reuters) - A group of Tesla Inc investors have urged the electric car maker to add two new independent directors who do not have any ties with Chief Executive Elon Musk.

End Airline Protectionism: Allow Foreign Carriers On Domestic Routes

Authored by Ryan McMaken via The Mises Institute,

In the wake of the United Airlines debacle - in which the airline had airport police assault one of its own customers - customers have begun to ask why there doesn't seem to be more competition for United to contend with. They ask: would United treat its customers so poorly if they had more competition?

Maybe not.

Is the Airline Industry Competitive?

Compared to governments — which enjoy near-absolute monopolies — airlines are quite competitive. But compared to many private-sector industries, they are not especially competitive.

It is true that a small number of firms dominate the airline business in North America. Investopedia claims the three top carriers enjoy 70 percent of the business, and Salon and the NYT say the top four enjoy 80 percent.

By the numbers provided here, we find that the top four combing for around 80 percent according to 2015 enplaned passengers:

JPM: "The S&P Is Stuck In Purgatory" Until Two Things Happen

Even as cracks have emerged in Trump's fiscal policy, as well as the overall market, on rising geopolitical concerns, the S&P remains surprisingly resilient, and as JPM's Adam Crisafulli writes in his mid-day recap, "the SPX is stuck in purgatory and hasn't moved in the last ~1.5 months."

What could change that? According to the JPM strategist, two things could lead to a breakout either higher or lower: a clearing of the "nominal growth clouds" and "the SPX vs. TSY gap is resolved."

So until either or both take place, JPM believes that "domestic equities will likely continue trading in a sideways/sluggish fashion. The one upside over the last 1-2 weeks are diminishing political expectations (which means there isn't a big Trump/Ryan premium left although this makes eco data that much more important)."

Key excerpt below:

J.P. Morgan Intraday Trader

Market update - on the surface there's nothing major happening. Headlines, attendance, and liquidity are all thin. All the major indices are trading lower but this has to be placed in context of the late-day Tues rebound rally (the SPX is still off the Tues lows and the big question isn't why stocks are so weak today but instead why they were so strong yesterday afternoon). There wasn't any major news out overnight on any of the big macro topics (nominal growth, Trump/Ryan pro-growth agenda, and geopolitical tensions).

TSYs aren't doing much but have rallied meaningfully in the last few days (the SPX and ...

Trump Backtracks; Confirms We "Have To Do Healthcare Before Tax Reform"

Back in late March, equity markets sold off on the first signs that Republicans were not going to be able to repeal and replace Obamacare as they had promised. Alas, the pessimism didn't last long as the BTFD crowd was able to quickly convince everyone that the failure of Obamacare was actually good for markets as it would allow the Trump administration to focus it's efforts on tax cuts instead...and, as usual, equities soared.

That said, per Trump's latest interview with Maria Bartiromo of Fox Business which aired earlier this morning, the BTFD strategists may have to find another catalyst for the next dip as Trump confirmed that healthcare has to get done before tax reform and infrastructure:

Trump: "I think we're going very well with healthcare. And after that, we're going to start on tax reform and infrastructure."

Not satisfied with Trump's subtle suggestion that healthcare would have to precede tax reform, Bartiromo pressed further....

Bartiromo: "But, do you have to do healthcare before tax reform? When I speak with business managers they say tax reform is so much more impactful to moving the needle on economic growth."

...at which point, she got a very clear answer: "Yes."

Trump: "Yes. They're all right. But because I'm saving a tremendous amount, hundreds and hundreds of millions of ...

Rajan Warns "The Fundamental Problems Of The Financial Crisis Are Still With Us"

Authored by Christof Gisiger via Finanz Und Wirtschaft,

Raghuram Rajan, Professor of Finance at the University of Chicago and former governor of the Reserve Bank of India, warns of more turmoil ahead if the developed world fails to adapt to the fundamental forces of global change.

It is a pivotal moment on the eve of the financial crisis. In the late summer of 2005, the world's most influential central bankers and economists gather in Jackson Hole at the foot of the Rocky Mountains. The atmosphere is carefree. Financial markets have nicely recovered from the bust of the dotcom bubble and the global economy is humming. Under the topic »Lessons for the Future» the presentations celebrate the era of Federal Reserve chairman Alan Greenspan, who has announced to resign in a few months. Since 1987 at the helm of the world's most powerful central bank, he presided over a period of continuous growth and was one of the leading forces of deregulation in the financial sector.

But when Raghuram Rajan steps to the podium the mood suddenly turns icy. At that time the chief economist at the International Monetary Fund, the native Indian warns that unpredictable risks are building up in the financial system and that the banks are not prepared for an emergency. His dry analysis draws spiteful remarks. »I exaggerate only a bit when I say I felt like an early Christian who had wa ...

Big Economies at Risk of Over-Revving Consumer Engines

Rapid growth in consumer credit is troubling policy makers. More defaults are likely to follow when rising interest rates push up repayment costs.

Akzo Nobel Paints Itself in Corner in Elliott Fight

Akzo Nobel management just wants to be left alone. But in fighting off both its U.S. suitor PPG and activist investor Elliott Management, the Dutch paint group may find itself increasingly isolated from shareholder allies it needs

Microsoft: Mining More Out of Minecraft

With Minecraft, Microsoft is learning that popularity doesn't always pay. The videogame has grown its user base since Microsoft's acquisition, but sales need a boost.

Key Words: What Montenegro might be telling us about Putin and Trump

As the New York Times was suggesting Wednesday that events in and remarks about Syria pointed to a shift in the Trump White House's posture toward Russia, a Wall Street Journal editorial pointed to a tiny nation in the Balkans as equally clear evidence of such movement.

FA Center: Why some financial advisers use someone else to manage their own money

Both advisers win — the client gets help with his finances, and the acting adviser gets insight into her profession.

The Ratings Game: BlackBerry will likely spend surprise $815 million arbitration award on acquisitions

Canadian mobile device maker will pocket the entire sum awarded in a dispute with Qualcomm and it will bolster its balance sheet, analysts agree.

Earnings Summary for Today

Earnings Calendar provided by Investing.com.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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