Written by Gary
US markets opened higher as expected and the DOW climbed over 200 points, however there is expectation of the markets to experience fractional losses by the close today. All of the major averages are reporting gains upwards of 1.5% and WTI crude prices rose in spite of reporting further gains in Cushing inventory.
Here is the current market situation from CNN Money | |
 | North and South American markets are mixed today. The S&P 500 is up 1.27% while the IPC gains 0.63%. The Bovespa is off 0.46%. |
Traders Corner – Health of the Market
| Index | Description | Current Value |
| Investors.com Members Sentiment: | % Bullish (the balance is Bearish) | 43% |
| CNN’s Fear & Greed Index | Above 50 = greed, below 50 = fear | 16% |
| Investors Intelligence sets the breath | Above 50 bullish | 19.5% |
| StockChart.com Overbought / Oversold Index ($NYMO) | anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. | -88.73 |
| StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) | $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% – 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. | 15.10% |
| StockChart.com NYSE Bullish Percent Index ($BPNYA) | Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. | 23.65% |
| StockChart.com S&P 500 Bullish Percent Index ($BPSPX) | In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. | 25.40% |
| StockChart.com 10 Year Treasury Note Yield Index ($TNX) | ten year note index value | 20.22 |
| 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 | 72.79 |
| StockChart.com NYSE Composite (Liquidity) Index ($NYA) | Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors | 9,289 |
What Is Moving the Markets
| Here are the headlines moving the markets. | |
| Kinder Morgan surges on prospect of higher dividend, buyback (Reuters) – Shares of U.S. pipeline company Kinder Morgan Inc shot up on Thursday as investors welcomed the company’s plans to cut debt, reduce spending and potentially increase its dividend or buy back shares. |
| Facebook launches real-time sports platform (Reuters) – Facebook is tackling the sports arena with a new platform called Facebook Sports Stadium, which the social media site said will provide real-time updates on games, popular posts from fans, statistics and commentary from experts. |
| ECB raises prospect of March policy easing as outlook sours FRANKFURT (Reuters) – Fading growth and inflation prospects will force the European Central Bank to review its policy stance in March, President Mario Draghi said on Thursday, a strong signal that more easing could be coming within months. |
| Aetna’s deal for Humana will push up costs for seniors: think tank WASHINGTON (Reuters) – Aetna Inc’s plan to buy smaller insurer Humana Inc for $31 billion will mean seniors will pay higher Medicare Advantage premiums, according to a new report by the think tank Center for American Progress (CAP). |
| United, Southwest buy 73 Boeing jets in blow to Bombardier (Reuters) – United Airlines said on Thursday it will buy 40 small planes from Boeing Co , dealing a $3.2 billion blow to Bombardier Inc’s hopes of landing a major customer for its fledgling CSeries program. |
| Dunkin’ Brands to expand into South Africa (Reuters) – Dunkin’ Brands Inc has signed a master franchise agreement with Grand Parade Investments Ltd to open its first Dunkin’ Donuts and Baskin-Robbins restaurants in South Africa. |
| JPMorgan tells investment bankers to take it easy on weekends (Reuters) – JPMorgan Chase & Co has joined other Wall Street banks in telling its investment bankers to improve their work-life balance by taking weekends off. |
| Rise in U.S. jobless claims spurs labor market worries WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits rose to a six-month high last week, suggesting some loss of momentum in the labor market amid a sharp economic slowdown and major stock market selloff. |
| Wall St. moves higher on Draghi comments, oil prices (Reuters) – U.S. stocks surged higher late on Thursday morning as oil prices rallied and ECB President Mario Draghi raised hopes of easing monetary policy further as soon as March. |
| WTI Crude Spikes Above $30 – Back To Post-Iran LedgeThe machines are in control. On the day when inventories surge, demand tumbles, production surges, and credit risk spikes, “traders” are panic-buying crude oil with both hands and feet… except they just ran the stops to the post-Iran open…
Let’s see if it holds… |
| The Birth Of The PetroYuan (In 2 Pictures)Give me that!!
It belongs to the Chinese now!
h/t @FedPorn As we previously detailed, two topics we’ve deemed critically important to a thorough understanding of both global finance and the shifting geopolitical landscape are the death of the petrodollar and the idea of yuan hegemony. In November 2014, in “How The Petrodollar Quietly Died And No One Noticed,” we said the following about the slow motion demise of the system that has served to perpetuate decades of dollar dominance:
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| New Lows Hit “Wash-Out” Territory (But Remember 1973)Via Dana Lyons Tumblr, The number of New 52-Week Lows on the NYSE has reached levels historically consistent with a ‘washed-out’ market. Just a week ago, we penned a piece called “Complacent Correction Cause For Concern?”. The premise was that, at least according to the S&P Volatility index (VIX), the level of fear in the market was not commensurate with the magnitude of the stock decline. In fact, the VIX was at the lowest level in its history during any such corresponding S&P 500 decline. Our takeaway was that until signs of fear and capitulation began to materialize, more downside risk remained in stocks. Sure enough, the market has continued to crater since then. However, we may be starting to see signs of capitulation – or, “wash-out” – that could suggest the worst of the selling pressure is almost behind us (for now). What are these signs? One source of potential clues is in the breadth, or internals, of the market. At times, a massive skew in the level of declining issues or volume versus advancers can signal a tipping point whereby market participants demonstrate a near-unanimous desire to “get out” of the market at the same time. Such capitulation often appears at the end of significant selloffs. We saw an example of such a wash-out day on August 24 of last year as the internals were historically skewed to the negative side. The internal skew signal can also be found in the ratio between New Highs and New Lows on an exchange, or merely just the level of New Lows. An abundance of New Lows … |
| Oil Rallies Despite Surge in Inventories, Demand Drop, And Production PopWTI Crude has ramped into this morning’s DOE data back to the scene of the crime from last night’s API ugly data dump. With API reporting a build that doubled expectations, DOE reports a 3.6mm build but worse still yet another major (4.6mm barrel) build in gasoline stocks for the largest 3-week build in history. Crude initially tumbled but the algos took over and ramped to yesterday’s highs…running stops (but how long will that last?) *CRUDE OIL INVENTORIES ROSE 3.98 MLN BARRELS, EIA SAYS *GASOLINE INVENTORIES ROSE 4.56 MLN BARRELS, EIA SAYS The data breaks down as follows… Crude +2.2m estimate (BBG users est 3.75mm) vs +4.6m API Cushing crude +400k estimate vs +63k API Gasoline +1.9m estimate vs +4.7m API Distillates +800k estimate vs +1.5m API As the following chart shows, Gasoline and Crude saw major builds and Cushing the 12th weekly build in a row…
And as inventories surge, Proroduction rises for the 6th week in a row….
And Demand collapses… |
| Stocks Rise as Draghi Signals Further StimulusU.S. stocks rallied, offering a reprieve from this week’s rout, after the European Central Bank suggested it was willing to offer more stimulus at its next meeting in March. |
| Activists Beware: Huge Investors Debut New Long-Term IndexSix large institutional investors said they would allocate $2 billion to track a newly created index of shares of companies that focus on long-term strategies. |
| Market Turmoil Hinders European Banks’ RecoveryJust as European banks were making progress stabilizing their businesses after years of crises, China fears, sliding oil prices and problems at Italian banks threaten to derail their efforts. |
| CBS boosts Showtime’s international reach with Sky partnershipCBS and Europe’s Sky Atlantic have agreed on an exclusive long-term licensing partnership for CBS’s growing portfolio of Showtime content. |
| The Margin: George Soros says the EU is ˜on the verge of collapse’Billionaire investor George Soros warns the European Union is facing several crisis at once and could tip into total collapse. |
| London Markets: FTSE 100 jolted higher on European stimulus prospectsU.K. stocks jump by the most in about a month after European Central Bank President Mario Draghi hints the central bank may ramp up its efforts to stimulate the eurozone economy, the U.K.’s biggest trading partner. |
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