Written by Gary
U.S. stocks were slightly lower during the morning hours, but rose off intraday lows after Federal Reserve Chairwoman Janet Yellen reiterated the central bank’s intention to raise short-term interest rates [later] this year.
Todays S&P 500 Chart
Large cap finished the session fractionally in the red while the Nasdaq closed higher in the green. The oils fell fractionally and stabilized at the lower levels, still well withing the sideways trading zone and the U.S. dollar broke through its resistance earlier and appears to want to move higher.
The Market in Perspective
| Here are the headlines moving the markets. | |
 | China Shares Hit Seven-Year HighChina’s stocks rallied for a fourth day to their strongest level in seven years, while Japan’s red-hot market rallied anew as the nation’s central bank kept its policy on hold. |
| Wall St. ends down slightly after Yellen comments NEW YORK (Reuters) – U.S. stocks ended weaker on Friday after Federal Reserve Chair Janet Yellen indicated the central bank was poised to raise interest rates this year, in line with broad expectations on Wall Street. |
| A Way to Make Big Gifts to Family Without TaxA recent Tax Court ruling cleared a couple’s use of so-called Crummey trusts to give $1.6 million free of U.S. gift or estate tax. |
| Fed on track to hike rates as economic headwinds wane: Yellen PROVIDENCE, R.I. (Reuters) – Federal Reserve Chair Janet Yellen was clearer than ever on Friday that the central bank was poised to raise interest rates this year, as the U.S. economy was set to bounce back from an early-year slump and as headwinds at home and abroad waned. |
| And The Market Breaks (As VIX Hits 2015 Lows)Surprise!!!! VIX hit 2015 lows and started to rip higher…
So something had to be done…
*BATS BYX HAS DECLARED SELF-HELP AGAINST NASDAQ *BATS:ROUTING TO NASDAQ HAS BEEN SUSPENDED AS OF 3:13 PM NY TIME
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| Hanergy: Bulk of Stock Collapse Was in Less Than a SecondThe collapse of a Chinese solar company’s shares this week was caused by a sudden wave of rapid-fire sell orders that sank the price in less than a second. |
| Germany, France usher Greece back to negotiating table RIGA (Reuters) – European leaders told Greece on Friday to return to the negotiating table for “intensive work” to wrap up a reform agreement before cash runs out, sidestepping Athens’ demand for a comprehensive, long-term solution to its troubles. |
| US Department Of Commerce Officially Jumps The Shark, Will “Double Seasonally Adjust” GDP DataIt’s official: after seeing it work so well for years in China, the US Department of Commerce’s Bureau of Economic Statistics has officially replaced all of its excel models with just one function. The following:
As Steve Liemsan hinted a few days ago, in what we thought was a very belated April fools joke, th eBEA has finally thrown in the towel on weak seasonally-adjusted US GDP data, and as a result has decided to officially proceed with a second seasonal adjustment: one which will take all the bad data, and replaced it with nice and sparkly, if totally fake and goalseeked, GDP numbers. As Bloomberg reports, “the way some parts of U.S. gross domestic product are calculated are about to change in the wake of the debate over persistently depressed first-quarter growth. In a blog post published Friday, the Bureau of Economic Analysis listed a series of alterations it will make in seasonally adjusting data used to calculate economic growth. The changes will be implemented with the release of the initial second-quarter GDP estimate on July 30, the BEA said.” In other words, as of July 30, the Q1 GDP which will have seen its final print at -1% or worse, will be revised to roughly +1.8%, just to give the Fed the “credibility” to proceed with a September rate hike which means we can now safely assume not even the Fed will launch a “hiking cycle” at a time when the first half GDP will print negative (assuming the Atlanta Fed’s 0.7% Q2 GDP estimate is even modestly accurate). Will abnormally … |
| Consumer Prices Rose 0.1% in April Lower gas prices helped moderate the gauge of inflation, but there were signs of pressure from rising housing and health care costs. |
| Oil Prices Slide, but the Market Is Little Changed Shares of energy companies dipped, and a report showing rising consumer prices suggested the Fed may have reason to raise rates yet this year. |
| Huatai Collects More Fuel for China Stock-Market FireChina’s $20 billion barrage of brokerage fundraising is looking long in the tooth, as Huatai Securities launches its Hong Kong IPO. |
| The Core of the Fed’s Inflation ProblemRising oil prices and a weaker dollar should feed through to higher core inflation. But not for a while. |
| Firmer underlying inflation keeps Fed on rate hike path WASHINGTON (Reuters) – Rising shelter and medical care costs boosted underlying U.S. inflation pressures in April, a welcome sign for the Federal Reserve as it contemplates raising interest rates this year. |
| China’s Tulipmania Full Frontal: Shenzhen’s Parabolic Stocks Just Hit 67x P/EForget Shanghai and its roaring stock market, there’s a new centre for speculative excess in China. Nothing says sustainable capital formation like a stock index that trades at a valuation of 67.2 times earnings, is up 166% in the last year and whose components regularly see 500% rallies (and recently epic collapses). Welcome to Shenzhen.
With margin debt hitting new records and with over 20 million new retail trading accounts opened in the last 9 weeks alone, China has – without any doubt – gone full tulip-tard…
But, as Bloomberg reports, the greatest fools can be found not in Shanghai, but in Shenzhen, home of China’s hottest stock market, rallies of more than 500% aren’t unusual.
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| Oil Prices Unmoved By Oil Rig Count Decline Of Just 1The total rig count dropped by just 3 last week – the smallest decline since December – to 885, tracking perfectly with the 4-month lagged oil price we have been showing for 4 months.
Oil rigs dropped just 1 on the week to just 659 – the lowest since August 2010. Oil prices are unch. *U.S. OIL RIG COUNT FALL 1 TO 659 ,BAKER HUGHES SAYS
Charts: Bloomberg |
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