Midday Market Commentary For 03-15-2013
The gaps that were left this morning when the markets descended have been covered as expected when the indices reversed course and headed back up. The averages appear to be recovering nicely with one notable exception. The SPY has only recently had a bump back up unlike the other averages. This signals caution as do my proprietary indicators that have been showing a wide divergence between what is happening and what most likely will be the eventual outcome.
By noon the volume had fallen to anemic levels which will allow manipulation from the HFT computers. There are few other signs that indicate in what direction the averages are likely to take in the very near term.
Financial reporting at 10 am was not so good and weakened the averages even more. I remain bearish.
Thomson Reuters/University of Michigan’s preliminary reading on consumer sentiment dropped to 71.8 in early March from 77.6 in February, hitting the lowest level since December 2011. Economist had been expecting an increase to 78. Stocks added to losses on the news.
It appears paying more for gasoline and higher taxes trumps the exuberance of the equity markets as UMich Consumer Sentiment crashed in February. Printing at 71.8 on expectations of 78.0 this is the biggest miss on record based on Bloomberg data.
The 71.8 level is the lowest since December 2011 as it appears that the Fed’s only remaining policy tool is just not sparking that animal spirit in the real economy’s anchor – the US consumer – as while current conditions did drop, it is future expectations that plunged.
The DOW at 12:00 is at 14508 down 30 or -0.21%.
The SP500 is at 1561 down 2 or -0.12%.
SPY is at 155.88 down 0.15 or -0.10%.
The $RUT is at 952.23 down 0.86 or -0.09%.
NASDAQ is at 3251 down 7 or -0.23%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is down.
WTI oil is trading between 92.00 and 93.84 today. The session bias was bullish earlier, but has turned negative and is currently trading up at 93.46.
Brent crude is trading between 107.50 and 109.90 today. The session bias was bullish earlier, but has turned negative and is currently trading down at 109.40.
Gold rose from 1577.20 earlier to 1598.48 and is currently trading up at 1595.12.
Dr. Copper is at 3.52 down from 3.56 earlier.
The US dollar is trading between 82.86 and 82.26 and is currently trading up at 82.42, the bias is currently negative.
** RRR = Risk Reward Ratio
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Written by Gary