Midday Market Commentary For 08-05-2013
Not much has changed since the morning report and the volume has fallen to very low. The current indicators are swing towards the negative side of things and perhaps we could see the averages dip somewhat by the closing bell.
Generally speaking, the markets are quiet with investors sitting this one out. The HFT computers are providing the action going into the afternoon session.
Trading today, nah that isn’t going to happen.
We talk continually about the ‘bubble’ the Feds may be making and the disastrous effect it ‘may’ have on the markets ‘sometime’ in the future.
Dallas Fed’s Fisher: “We Own A Significant Slice Of Critical Markets. This Is Something Of A Gordian Knot”
“This is a delicate moment. The Fed has created a monetary Gordian Knot. Whereas before, our portfolio consisted primarily of instantly tradable short-term Treasury paper, now we hold almost non.
Our portfolio consists primarily of longer-term Treasuries and MBS. Without delving into the various details and adjustments that could be made (such as considerations of assets readily available for purchase by the Fed), we now hold roughly 20 percent of the stock and continue to buy more than 25 percent of the gross issuance of Treasury notes and bonds.
Further, we hold more than 25 percent of MBS outstanding and continue to take down more than 30 percent of gross new MBS issuance. Also, our current rate of MBS purchases far outpaces the net monthly supply of MBS.
The point is: We own a significant slice of these critical markets. This is, indeed, something of a Gordian Knot.“
The DOW at 12:30 is at 15606 down 51 or -0.33%.
The SP500 is at 1707 down 2.29 or -0.13%.
SPY is at 170.73 down 0.22 or -0.13%.
The $RUT is at 1062 up 2.57 or 0.24%.
NASDAQ is at 3686 down 3 or -0.08%.
NASDAQ 100 is at 3136 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 negative.
WTI oil is trading between 107.68 and 105.71 today. The session bias is positive and is currently trading up at 106.81.
Brent crude is trading between 109.43 and 107.58 today. The session bias is positive and is currently trading up at 108.75.
Gold fell from 1319.85 earlier to 1296.99 and is currently trading down at 1300.85.
Dr. Copper is at 3.159 falling from 3.188 earlier.
The US dollar is trading between 81.81 and 82.15 and is currently trading up at 81.981, the bias is currently negative.
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Written by Gary