26May2015 Market Close: Crazy Days Are Here Again

Written by Gary

What a crazy day. Markets down. Volumes up. Dollar up. Economic data mixed. Yet today’s economic data was enough to push the Atlanta Fed’s GDP Now 2Q2015 GDP forecast from 0.1% to 0.8%. Read more below how the market is out of touch with today’s investor.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.
	Oil Slump Has Calgary Awash in Vacant Office Space When crude prices were high, the commercial real-estate market in Canada’s oil capital rivaled that of Houston. Now energy companies are cutting back, vacating a record amount of space even as construction of nine major buildings is under way.
	Square Feet: Youngstown, Ohio, Reinvents Its Downtown With new residential and commercial development, the city works to shed its reputation for crime.
	And Just Like That, Volume Is Back Surprise! Today will be 2nd or 3rd most active day in May for eMini’s.. $ES_F That’s high for day after Memorial Day Weekend â€” Eric Scott Hunsader (@nanexllc) May 26, 2015 Can you spot the selloff day by looking at the lower pane? Charts: Bloomberg
	U.S. Stocks Close Lower Stocks sank after a mixed bag of U.S. economic data underscored investor unease with the recent pace of economic growth.
	Wall St. falls on concerns about Europe, U.S. rate hike (Reuters) – U.S. stocks fell on Tuesday, pushing the S&P 500 to its biggest percentage drop in three weeks on Tuesday, weighed down by concerns about Greece’s financial crisis and some upbeat U.S. economic data that fueled expectations a rate hike could come sooner rather than later.
	Charter’s $56 billion Time Warner Cable deal to face tough U.S. scrutiny (Reuters) – Charter Communications Inc’s $56 billion bid to remake the U.S. cable television industry by acquiring larger rival Time Warner Cable Inc will try to skirt the regulatory obstacles that helped sink Comcast Corp’s earlier bid for Time Warner Cable.
	VIX-nado, Dollar-splosion, & Crude Carnage Spark Dump In Stocks & Bond Yields Jubilant Chinese investors did not help as good news is terrible news it would seem… despite Stan Fischer’s confidence-inspiring message that “just the tip” of interest rate hikes won’t hurt… FISCHER IS RIGHT; MARKETS OVER FOCUS ON 1ST HIKE, EL-ERIAN SAYS After an ‘odd’ day yesterday with BTFDing machines rescuing stocks, US equity markets reopening saw some selling overnight and then a deluge during the day session… (weak data early and 1230ET Fischer) FISCHER SAYS FED COULD SLOW RATE RISES IF WORLD GROWTH FALTERS *FISCHER: FED SHOULD `EXPECT SPILLOVERS’ WHEN POLICY TIGHTENS Since Friday, the cash indices are all notably red… Trannies NOT off their lows… The Dow traded back below its 50DMA (18,010) briefly…
	Worry Over Earnings for Southeast Asian Stocks Profits at companies across Southeast Asia are on the slide this year, and analysts say more pain is in store. That spells trouble for equity investors.
	Why “Average Joe” Will Never Do Well In The Stock Market Because “normal people” just do not think like this… And bad news is good news… h/t @RudyHavenstein
	Oil Pressured by Dollar Strength Oil prices slipped Tuesday on a stronger dollar and concerns that the recent rally in oil prices could spark an increase in production.
	Charter’s Time Warner Cable Bundle is No Bargain Charter finally got the cable consolidation it was seeking with deals to buy Time Warner Cable and Bright House. But it had to pay up to get them.
	Chuck Norris Warns Washington On Jade Helm: “Don’t Mess With Texas” Earlier this month, Lone Star state residents breathed a heavy sigh of relief after Chuck Norris promised that in the event a US Spec Ops training exercise inexplicably morphs into a second (and thereby completely redundant) annexation of Texas, Walker Texas Ranger will personally defend the state against a Navy SEAL incursion. As a reminder, the government is set to conduct a series of training exercises in several Western states including Texas beginning on July 15. The operation, dubbed “Jade Helm 15”, has sparked quite a spirited debate, especially among Texans, some of whom believe the drills are a prelude to martial law. Suspicions have by no means been confined to conspiracy theorists with the Governor himself calling on the Texas Guard to monitor the operation, a move which at least one former Texas Republican lawmaker has called “embarrassing.” Indeed, even former Governor Rick Perry has now weighed in, noting that even though he questions the government “on a regular basis”, a Texas invasion likely isn’t in the cards: “I think it’s OK to question your government â€” I do it on a pretty regular basis. The military’s something else. You know, I think our military is quite trustworthy. Civilian leadership â€” you can always question that, but not the men and women in uniform.”
	U.S. top court rules against Cisco Systems in patent infringement fight WASHINGTON (Reuters) – The U.S. Supreme Court on Tuesday ruled against Cisco Systems Inc over a patent infringement claim the tech giant is fighting.
	Supreme Court Rules on Whistle-Blower Case and Bankruptcy Judges The court said that a suit against Halliburton and KBR Inc. had been filed too late, and it also expanded the power of bankruptcy judges.
	Meet The Man Responsible For Oklahoma’s Earthquake Epidemic As part of the US shale miracle, a far less pleasant, and talked about side-effect are the millions of gallons of wastewater: that key component of the new drilling technology that allows previously inaccessible deposits to be extracted. And, as increasingly more states are finding out, the problem isn’t pumping the water out, but finding a place to put it, no places more so than Oklahoma. To be sure, Oklahoma benefited hugely from the shale revolution: the state’s oil production has doubled in the past five years. And now, as the Piper has finally come to collect his due, the ground is literally shaking under the feet of Oklahoma’s residents as the aftermath of the fracking “boom” has unleashed an unprecedented series of earthquakes. The reason: instead of disposing wastewater in some regulated manner, in Oklahoma it gets injected back underground. And as wastewater disposal rates have doubled, seismic activity has exploded across Oklahoma. After averaging 1.6 earthquakes per year of magnitude 3.0 or higher, the state experienced 64 in 2011, including its largest in recorded historyâ€”a 5.7-magnitude temblor on Nov. 6, 2011, centered in Prague, 50 miles east of Oklahoma City, that buckled a highway, destroyed 14 homes, and injured two people. Last year, Bloomberg reports, the number soared to 585 quakes, making Oklahoma the most seismically active state in the continental U.S.; it’s on pace for 900 quakes in 2015 a number one would expect from a place such as Japan, located on a continental fault line or even California (whose San Andreas faultline is about to make another B-grade movie appearance) and certainly not in America’s heartland. Swarms of quakes have rattled other states with oil and gas operations, including Arkansas, Colorado, Kansas, New Mexico, Ohio, and Texas.< …
	The Low Spark of High-Priced Homes One reason new-home sales are still so low: New-home prices are still out of reach for many Americans.
	Ex-Trader Called â€˜Ringmaster’ at Libor-Rigging Trial British prosecutors say Tom Hayes provided 82 hours of testimony over five months and admitted to adjusting global benchmark interest rates.
	“We’re Living In A Make-Believe World” Biderman Warns “A Global Recession Is Inevitable” Submitted by Christoph Gisiger via Finanz und Wirtschaft, Charles Biderman, founder of the research firm TrimTabs spots a warning sign in the drop of the commodity prices and mistrusts the paper money of the centrals banks. In every market supply and demand are determining the price. Charles Biderman uses this simple logic as the foundation for his investment philosophy. The outspoken founder of the research firm TrimTabs is convinced that stock prices are a function of liquidity—the amount of shares available to buy and the amount of money available to buy them—rather than fundamental value. Therefore, he carefully tracks the announced actions of companies. In his view they are among the biggest players in the stock market and the driving force behind today’s bull market. For now, Biderman thinks that this trend will push stock prices even higher. For the medium term though, he cautions that the financial markets are poised for a severe crash. He spots the first signs of a global recession in the drop of the commodity prices and warns of the moment when people don’t trust the paper money of the central banks anymore.
	Fed rate hikes may trigger global volatility: Fischer TEL AVIV (Reuters) – When the Federal Reserve raises U.S. interest rates for the first time in nearly a decade, it should weigh the effects on global economies and can expect some bouts of financial market volatility, a top Fed official said on Tuesday.
	“It’s A Madhouse” – At Least 6 Dead, 12 Missing As Floods “Hammer” Texas & Oklahoma “We got hammered,” Houston’s emergency management coordinator Rick Flanagan told CNN, and as the following stunning images show, that is an understatement. “We’ve seen flooding before, but not nearly to this extreme,” said one resident, adding “It rains and it rains and it rains, and there’s really nowhere for the water to go… It’s ridiculous.” Perhaps even more stunningly, as Mashable’s Andrew Freeman notes, the floods have been a remarkable turn of events for a region that was still mired in drought as of three weeks ago. That drought, which had affected Texas since 2010, is now effectively over in most areas, as is a long-running drought in Oklahoma. Authorities are still searching for 12 members of two families who went missing over the weekend. As Reuters reports, Texas Governor Greg Abbott on Monday described the flash flooding that had killed at least three people in his state as “a relentless wall of water that mowed down huge trees like they were grass.” Abbott declared states of disaster in 24 counties and flew over the area south of Austin to assess the damage caused by tornadoes, heavy rainfall, thunderstorms and flooding that forced evacuations and rooftop rescues and left thousands of residents without electrical power.
	Takata faces questions over air bag fix as recalls expand DETROIT (Reuters) – Automakers and safety regulators could take months to nail down why air bag inflators made by Takata Corp are exploding with too much force, meaning consumers cannot be certain replacement inflators installed under a sweeping recall are safe, industry officials involved in the process said.
	Russia Tells France It Gives Up On Mistral Ship Deal With French ministers crowing about their better-than-expected GDP data (+0.7%) as some trend reversal that heralds a revolution, it appears Vladimir Putin is about to put a dent in their hopes and dreams. As Sputnik News reports, Moscow has finally given up on the $1.3 billion deal for two Mistral-class helicopter carriers and plans to build its own. Even worse for France, now Russia will discuss only the sum that Paris should pay Russia for the failed contract. However, as with everything in the world, there may be aulterior motive, as China comes sniffing as a white knight for the amphibious vessels (at a reduced price) and then sells to its ‘ally’ Russia (who has already pocketed the contract cancellation fees). As Sputnik News reports, During the negotiations on the Mistral deal Russia and France have discussed only one question – the sum of the compensation. “We switch the conversation to business – give us our money back… We’re now discussing just one thing – the exact sum of money France owes Russia,” Oleg Bochkaryov, a deputy chairman of the Russian Military Industrial Complex said. Russia and France signed a $1.3-billion deal for two Mistral-class helicopter carriers in 2011. The handover of the first ship to Russia was …
	The â€˜King of Cable’ Behind a Charter-Time Warner Cable Deal John Malone made his fortune as a pioneering baron of American cable, and has had his hands in everything from the Discovery Channel to DirecTV.
	Do You Smell Smoke? …or just see the mirrors… Source: Townhall
	Electronic Medical Record Sharing Is Hurt by Business Rivalries The Obama administration has spent billions on getting doctors and hospitals to computerize patient records, but not everyone is playing along.
	Today’s Economic Data Enough To Push Q2 GDP By Whopping 0.1% To 0.8% … at least according to the Atlanta Fed. Based on the one GDP model which hasn’t lost all credibility and which for the past 3 months has captured the attention to wannabe weathermen and other Wall Street strategists, today’s bevy of stronger than expected data, everything from Durable Goods, to core CapEx, to New Home Sales, to Case Shiller, to Consumer Confidence, and even the Richmond Fed was sufficient to push Q2 GDP… by 0.1% to 0.8%. From the Atlanta Fed GDP Now webpage: The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2015 was 0.8 percent on May 26, up slightly from 0.7 percent on May 19. Following this morning’s advance durable manufacturing report from the U.S. Census Bureau, the forecast for second-quarter real equipment investment growth increased from 3.5 percent to 5.1 percent while the forecast for the change in inventory investment in 2009 dollars increased from -$22 billion to -$19 billion. Perhaps today’s market reaction, with yields tumbling and telegraphing that the reflation trade is gone and with stocks at LoD, is actually completely reasonable and normal in light of the fact that according to the Atlanta Fed, the US economy is still contracting in the first half, laughable seasonal adjustment notwithstanding.
	Bits Blog: Two Apple Designers Step Up as Jony Ive Becomes Chief Design Officer Apple is boosting the profile of two designers, Richard Howarth and Alan Dye, under longtime design head Jony Ive, who gains the new title of chief design officer.