Market Recon Friday

Good Morning,

                        Funny thing happened yesterday afternoon, just as that S&P 1812 level that all of planet earth was keeping an eye on started to crack.  Yeah, funny thing.  That was when an Oil Minister out of the UAE was cited as saying as indicating that several OPEC nations were ready to cooperate on possible production cuts.  Oil found a bid, stocks found a bid, the rally continued in Europe,. and is still visible in early morning US equity index futures trading.  Odd timing.  They probably do all have sizable equity portfolios.  Is it pure bologna??  Well, we all know that these guys do not work well together, and don’t seem to trust each other very much.  We also know that a reduction in production (Hey, look I’m Clyde) would be a common sense move that is beyond overdue.  Are reductions coming ?? Yes, and not only from OPEC.  Will they be well coordinated ???  Yeah. maybe.
                        I’ve decided to take a day off from bashing the Fed.  I mean, even though the heart is willing, as an everyday thing…. I understand it can get pretty old.  Now…what about risk going into a three day weekend ?? Europe’s higher.  Oil is higher.  Technically, a bounce looks imminent….. but, and this is a doozy… China re-opens on Monday, while we are closed.  Traders hate carrying risk into long weekends, and China has a lot of downside likely priced into their re-opening.  In fact, by the time, we re-open on Tuesday morning, the Shanghai will have opened, and closed twice.  I think you will see some folks who got hurt this week try to ride this wave this morning, but there will be a tempering of this rally at some point today, if not by the traders themselves, by their risk managers.  This tug of war will likely be intellectually interesting to watch as the day unfolds.
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Hey, now, how about that Recession Risk Rising article by Josh Zumbren in today’s Wall Street Journal ??  Wasn’t I just a kook for mentioning this on TV weeks ago ??  Got a lot of silly looks that day.
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Nerd Note:  Not sure, but I think Strat-O-Matic opening day is today.
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Full Plate of Macro
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08:30 ET
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Retail Sales (January):  December was an ugly month for Retail Sales.  Let that one sink in for a second.  That’s right, last month’s prints both came in at -0.1% m/m.  Those prints being the headline number, and the Core, which excludes automobiles both stunk.  In fact, we have not seen a healthy month for this item since the Summer.  The January numbers that we’ll see today should show some improvement, which is good, but it will not likely be what we need to see from the consumer to make the trend look all that much better.  Expectations are for growth of 0.1% m/m at the headline, and a flat-line at the core.  Reason for hope… the skew for the core print is slightly to the high side.
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Import and Export Prices (January):  This is another instance of peanut butter and jelly macro.  Doesn’t make much sense to cover these two separately.  Deflation anyone??  Both of these items have been mired in deep contraction for quite some time now, having collectively abandoned the zero growth zone back in the lazy, hazy, crazy days of Summer.  In December, US exporters received 1.2% less for their goods than they did in November.  Conversely, Importers paid 1.1% m/m, so there is that.  For January, expectations are that Export prices saw deterioration of only -0.8% m/m, while Import prices just rolled off of a table again…to the tune of -1.4% m/m.
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10:00 ET
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Business Inventories (December):  Due to this item’s lack of sex appeal, and the fact that this is dated information..you will not see much of an impact here.  We also have a higher profile release kicking off at the same time.  Due to lagging sales, the inventory build has been weak in recent months.  In November, we saw this item contract by -0.2% m/m.  This print should show some improvement to +0.1% m/m.
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U of M Consumer Sentiment (February {p}):  As you already know, anything with the word “consumer” in it, has outsized market impact upon it’s release.  The U of Michigan survey, although well off of it’s highs, has for the most part remained entrenched in the 90’s.  That is a healthy area to be by most economist’s standards.  For this, the preliminary February print, we look for a slight uptick to 92.3, from the January final of 92.0.
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13:00 ET
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Baker Hughes Rig Count (Weekly):  This item showed some declines last week, and it stands to reason, given the price of Crude over the last few days that the rig count probably dropped further.  Going into this number, the US count stands at 511, and the North American count stands at 813.
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The Dark Side of the Force
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                Not bashing.  Just letting you know that we do have two Fed speakers approaching the perimeter.
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09:45 ET:  Dallas Fed Pres. Rob Kaplan will speak from Dallas on the housing outlook for the state of Texas.  It does not appear that monetary policy is on his agenda for today, and he is not a voting member of the FOMC.  I do not see this speech as an imminent threat to the markets.
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10:00 ET: New York Fed Pres. William Dudley is set to speak on household debt from New York City.  As you all know, Dudley is a voting member, and his words are watched extremely closely.  Therefore, even though his direction today should not take him anywhere dangerous today, his threat level to the marketplace will remain at least moderate.
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Friday’s Earnings Highlights
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Before the Open: IPG (.62), RRGB (.82)
After the Close: We usually look forward to a nasty plate of disgusting nachos.  After this week of market action however, nachos have been deemed a bit pricey.  Saving up for next week.

Mid-Day Thoughts

1)  Can’t think of a specific reason why markets are in chaos…  other than Negative Interest Rates,… Crippled European Financials,…Weak Crude/Energy/Commodities,….Chinese/Global demand, Currency Wars,…Earnings Recession,…Sovereign Wealth Funds,…Outright Depression in Manufacturing,….steadily weakening US macro, and ….political risk to the Health Care sector. On top of that we have a Fed Chair who sounds like she started at the Fed on Monday.  Nope, nothing really out there.
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2) Gold, Treasuries…De-Fense !!!  dividend plays are not even working.
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3) Cheaper dollar not helping oil, but certainly helping some commodities.
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4) Ten sectors deep in the red, looks like nobody gets out alive.  Maybe when Janet stops talking.
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5) Technically. S&P level 1812 did work earlier.  Hoping not to test it again.  that spot beaks and we likely re-start all of the talking about a general capitulation.
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6) First heavy macro day of the week tomorrow.  What could go wrong?

Market Recon Thursday

Good Morning,

                        The beatings will continue until…until…..ahhhh, forget about improving morale …the beatings will just continue.  Like a mercenary being paid only for a defined result, and for nothing else, the selling in many markets is without emotion, without loyalty.  Face already ripped off, I’ll rip something else.  What’s left?  Didn’t play defense?  You did know better.  You still do.  Failure to act initially, is no reason to remain inert.  Use your brain.  You are not tree moss.
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Ugly Stick
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                         European equity indices are all down anywhere from two to five percent this morning, after the Sweden’s Riksbank took an already negative benchmark interest rate even deeper into the abyss.  Not a member of the Euro-zone, Sweden actually has a GDP…heck, that doesn’t matter.  Deflation…. 4 eva !!!  European banks are again in melt-down mode, oh, and have you seen Crude this morning?  Whomp whomp.  US equity index futures??  Smashified !!
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Sarge, What is Working ??
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                       The cool kids already bought Gold and Treasuries.  Remember my re-allocation note earlier this week on top of the one I wrote on New Year’s Eve?  You also can find some defense in the Utilities, Telecom, and the Staples.  Write it down this time.
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7am ?? Fed Bashing Time  
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                       Ever see Hall of Famer Barry Sanders (the running back, not Bernie, the socialist) run all over the field, eluding tacklers, and end up gaining 20 or so yards, after having run 70 or 80 yards ??  Well, that’s sort of what Fed Chair Janet Yellen did yesterday….. without the 20 yard gain part.  She was all over the field.  We heard that “Monetary policy was not on a preset course”…the doves cheered.  We heard that the Fed prefers to reduce accommodation through interest rate hikes as opposed to outright sales of longer-term assets”….. the hawks roared…and then we heard the unthinkable.  The good doctor was asked if it was even legal for the Fed to, if ever needed go to the dark side, and implement negative interest rates.  Unbelievably, incredibly…she indicated that she had not fully investigated the issue.  Doves, and hawks alike stood up and screamed at their TV sets…..  “You mean you testify before Congress, and you didn’t do your homework ????!!!!!!!”   Unacceptable !!!!!  Guess she didn’t think the topic would come up.  Silly Congress.  By the way, thanks to Hilsenrath’s article in the Wall Street Journal, we all know that an internal Fed memo from 2010 states that the Federal Reserve Act is not clear on whether negative rate are at all permitted, and that memo was authorized for release last month.  So….somebody looked into something.
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The Goods
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08:30 ET
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Initial Jobless Claims (Weekly):  My, how times have changed.  It was only a few months ago that this item was printing in the 250k’s, and the four week moving average was right around 260K.  That was then, this is now.  Last week, the number came in at 285K, which is just a shade above the four week moving average, and we’ve now gone six consecutive weeks with at least 277K folks filing for Unemployment benefits.  Prepare to make it seven, as expectations for today are for 283K, with a range spanning from 272K to 290K.  It likely will not be this week, but it does feel as if there is a 300K tag out there stalking us.
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10:00 ET
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Fed Chair Janet Yellen:  The cheese stands alone again today.  This time, she’s testifying before the Senate Banking Committee.  This dog and pony show will resemble yesterday’s performance, perhaps….hopefully…with a few new questions…and answers.  Maybe, she’ll talk up the markets, LOL.
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10:30 ET
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Natural Gas Inventories (Weekly):  Last week, supplies for natural gas shrunk for tenth consecutive week with a release of -152 billion cubic feet.  We do expect an eleventh consecutive draw on inventory for this one today, though expectations are for a reduction of roughly -80bcf.  That would the smallest drop in over a month.
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Thursday’s Earnings Highlights
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Before the Open:  AAP (1.21), ALU (.09), K (.75), TAP (.49), PEP (1.06)
After the Close:  ATVI (.86), AG (-.92), CBS (.93), P (.07), ROVI (.37), ZG (.01)

Mid-Day Thoughts

Hi Gang !!

              At least this whole Q&A thing flies by !!
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1) The House Financial Services Committee clambake down in DC is today’s focus.  Did we learn much ?  I don’t think so.  The Fed Chair has been successfully vague.  She expects to carry on with gradual rate hikes, but….. you know the rest.
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2) The S&P 500 has strictly obeyed technical levels at 1860, and 1880.  There’s another level in the middle of those two, around 1872 that i’m watching very closely right now.
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3) Crude has been all over the map today. Inventories unexpectedly dropped, but there’s a significant caveat.  Apparently severe fog kept ships from downloading in Houston.  If true, I guess we’ll see it next Wednesday.
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4) Health care and Tech are leading the way.  Safe havens are less safe.  Utilities, Gold, and Treasuries are all in the red, however all are off their lows.
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5) Earnings tonight.  Options are pricing in about $12.50 worth of volatility for TSLA, and about $1.50 fro TWTR.
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6) Heard Burger King is close to putting hot dogs on the menu.  A new reason to carry on.

Market Recon Wednesday

Good Morning,
                       European equities are green across the screen this morning, being led by the bank stocks that are in turn…being led by Deutsche Bank.  Huzzah !!  No hard news hear, just rumors that flew yesterday afternoon that the bank is considering downing a couple of bowls of it’s own Coco Puffs.  Who doesn’t need eight vitamins and minerals, right ??  Who, also may (will) need to issue these CoCo bonds again in the future, so …. in the name of those future borrowing costs…. better not let them go any lower than they already are !!!
                      Okay, sportsfans…today’s the day that we’ve been waiting for all week.  Our dear friend and neighbor, the Fed Chair Janet Yellen testifies this morning before the House Financial Services Committee.  Just in case you’re keeping score, she’ll also do the fandango tomorrow in front of the Senate Banking Committee, but any cat that might be trying to get itself out of the bag will likely do so today, perhaps during the Q&A session.  On top of that, the text of her prepared speech will be released at 08:30 ET, so the futures will bounce around a little, but hey… that’s like batting practice for us by now..
                      There will be many questions answered today, but likely…. unfortunately, the good doctor will be as vague as she can get away with, likely trying to leave many unanswered.  Obviously the markets just want to know, simply… if the FOMC’s concentrated thought direction on policy has changed much since the last time they checked in.  It doesn’t take a genius to see that the economy has hit something rougher than a soft patch.  Just speaking for me, and the good folks around me, seems more like a garbage truck going over a cliff during a hurricane.  It would appear to the armchair economist that prudence would reign supreme at a time like this.  Unfortunately, the armchair economist often holds down a real job, and thus… does not live in the same realm as those living in the castle.  Markets are facing numerous risks, and, quite obviously are in quite a flux due to those risks. Common sense says maybe putting future hikes for the Fed Funds Rate on a temporary shelf would be wise.  Unless….
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Enter Sandman
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                         Before you go expecting to be held by the hand, and having your belly rubbed…..any of you kids read James Rickards ??  I make a habit of reading people I consider to be  much smarter than myself, and trying to understand what they are telling me…..so I do read his stuff.  If you are unfamiliar, he is the economist, strategist, and best selling author of several books, including “Currency Wars”.  If you’ve never at least heard of that book, I can’t help you.  Rickards has had a habit over the last few years of seeing things (ahead of time) pretty clearly regarding direction of monetary policy, and he thinks that rather than adjusting the Fed’s outlook to market expectations that Janet Yellen will likely try to adjust market expectations to the Fed’s outlook.  In other words, the Fed’s intent (unchanged) is far more important to them at this time, than recent market activity, or even the most recent macro, as long as neither of those two actually hits what they consider to be catastrophic levels.  Not what we consider to be catastrophic levels.  Now, gang….wouldn’t that be a nasty kick in the pants?
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The Lineup
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08:30 ET:  The Text of Janet Yellen’s testimony is released.
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10:00 ET:  Fed Chair Janet Yellen testifies before the House Financial Services Committee.
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10:30 ET: Oil Inventories (Weekly):  Last week, this item blew the doors off of expectations with an increase in supply of 7.8 million barrels.  Today’s projections are for another increase, this time to the tune of 3.6 million more barrels.  Then again, that’s pretty close to what was expected last week.
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13:30 ET: San Francisco Fed Pres. John Williams speaks on the economy from Los Angeles, California.
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Wednesday’s Earnings Highlights
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Before the Open: DTE (.99), HUM (1.46), MRKT (.38), TWX (1.00)
After the Close: EFX (1.11), IFF (1.14), PRU (2.30), TSLA (.09), TWTR (.12), ZNGA (.00)

Mid-Day Thoughts

Good Afternoon,

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1) Our old friend, the “Ugly Stick” is back out and about.  Wanna find something ugly, step right up, and spin the wheel.  Every number wins a prize.  Red or black, makes no difference.
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2) Crude went through $29 like a hot knife through butter, and now threatens to go belwo $28.  Some folks think there’s support at $25.  Some are glad it can only go down another 28 .clams.
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3)  European Banks putting pressure….. on well…  everything financial related.
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4) The “Safety Dance” was a hit tune, back in the early 1980’s. Well, seems to me like it’s headed for a sudden rebirth in popularity.  Treasuries, Gold, the VIX, and the Utility sector all wearing green today.
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5) Looking for something of a short covering this afternoon, ahead of the 08;30 am release of the text of Janet Yellen’s testimony before Congress.
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6) SPX 1840 matters.  Stiff resistance up at 1860, Iffy support at 1831, better support at 1824.
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7) What, me worry?

Market Recon Tuesday

Good Morning,
                       You’ve got to just love a minor rally at the end of a two day “beat your face like a drum” sell-off that makes you feel slightly relieved.  A couple of shorties ringing the register?  You also have to ask yourself, if there is yet panic in the streets.  Panic in this era of electronic trading is far more difficult to detect that it once was.  Gone are the days of accounts screaming at trading assistants on the floor, and wishing all kinds of fatal illnesses upon their family members just to try to throw them off of their game.  There is time to eat, and use the restroom during trading hours, even on the busiest days.  No ripped shirts in the crowd.  No threats.  No sweat.  No tears.  So, how do you know?
                       Many of us like to look at the VIX, and on the day they run for the hills, that index will spike, but will it significantly signal to traders when it is time to break the glass?  I think your canary in the coalmine has to be the defensive posture being taken by many traders I speak to.  We have real traders hiding in cash.  We see yields on government debt shrinking rapidly.  In fact, the ten year yields 1.75% as I bang out this note, but the darn thing touched 1.68% in the overnight.  Then there’s gold.  Gold was left for dead.  Not relevant in the modern world.  Now they all wish they bought it $150 dollars ago.  For a chart-monkey like myself, Gold looks overbought, at least in the short-term, and likely will pull back a touch.  When I increased my allocation yesterday morning, I did not expect to see something like that move yesterday happen almost immediately.  That said, when fear drives decision making, technical analysis probably does not count for much.  TA works best when humans are not in control.
                      To conclude, there is not yet fear in the streets, but folks are thinking, and talking about it.  I do not hear too much about dollar cost averaging these days.  Know what I mean?  There are those playing defense, and there are those who are caught in the headlights.  I think the market will hear Janet Yellen out this week, and then…well, I’ll let you know then.  When you act, have a reason.  That always has been, and always will be rule one.
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Not the Droids You Were Looking For
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               Our best day for data this week will be Friday. Until then, the pickings will be pretty slim.  We do have some macro today, but nothing that will make the children dance, and the old ones sing songs of ancient victories.  That said, we might as well run through it, just so you know what is out there.
                Earlier today, we saw the January print for the NFIB’s Small Business Optimism Index.  That print came in at 93.9, which badly missed expectations.  In fact, this number indicates that American small business owners are more pessimistic looking forward than at any time over the last two years.  Sales expectations, hiring expectations, and economic outlook all took a hit in this survey.
           Still on the way, we have the weekly Redbook measure of chain store retail success at 8:55 ET.  This item has been steadily ebbing, though still showing improvement when measured year over year ever since the holiday season came to a close.  Last week, we saw a y/y increase of 0.8% in this space.
            We also have two 10am items that will likely fail to make headlines unless something comes in sideways.  December JOLTS are expected to print in the neighborhood of 4.7 million openings.  We all know that there is a jobs / skills mismatch, and this number is dated on top of that.  Another dated release will be the December Wholesale Inventories print.  Projections are for -0.1% m/m, coming off of November’s -0.3% m/m.
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Tuesday’s Earnings Highlights
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Before the Open: KO (.37), CVS (1.53), IR (.93), MAS (.26), TEN (1.14), VIAB (1.17), WEN (.11)
After the Close: SCTY (-2.39), DIS (1.45), WU (.42)
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Final Thought:  Help the guy or gal next to you in these markets.  If you feel that you’ve defended yourself, then try to help someone who seems a bit shaky.  If you are the nervous one, talk it out with a mentor type.  The is no victory if you only save yourself.  Sarge out.

Mid-Day Thoughts

Dear Whack-a-Moles,

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1)  The “Ugly Stick” is out and about.  Financials..Bang !!  Tech stocks.. Bang !! Discretionaries.. Bang !!  Materials (less Miners) .. Bang !!  All ten sectors in beat-down mode.
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2) The Utilities, and Energy sectors, even with Crude fighting off that $30 support level, are our out-performers.. though the Energy sector index is off more than a percent.
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3) Where’s the money going ???  Gold, and Treasuries.  Gold approaches $1200, and Treasury yields have collapsed.
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4) Watch the Super Bowl ?  That’s right…. Defense wins Championships.
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5) Do I smell fear yet?  Not really.  Folks are watching everything though with caution.  The VIX has stabilized the 26’s.  European banks are getting drilled.  Janet Yellen is warming up her vocal chords for Wednesday, and not to mention Retail Sales loom on the Friday before a three day weekend.  ahhh, yaknow… scratch that last one, we already the macro’s gonna rot.
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6) Technically, I won’t feel better unless the S&P gets all the way to, and recaptures the 1958 level.

Market Recon Monday

Good Morning,
                        Tough week ahead… for a numbers nerd.  With the exception of Friday, which will  be headlined by January Retail Sales, we are in the middle of something of a macro “dead zone”.  We’ll have to look back at last Friday’s Employment Report, that really told everyone out there whatever it was that they wanted to hear…and we’ll have to look ahead to this Wednesday morning when Fed Chair Janet Yellen will testify before the House Financial Services Committee in Washington, DC.  The good doctor will give an encore performance on Thursday in front of the Senate Banking Committee, but it is doubtful that any stones that go unturned on Wednesday pop up on Thursday.
                        So, what was it about those January Jobs numbers that sent equity trader for the exits on Friday…and apparently have futures trader carrying that momentum on this morning?  Well, really, it was the duplexity of the report.  Those still bent on raising the Fed Funds Rate sooner rather than later could point to a lower headline Unemployment Rate, and actual, considerable wage growth.  Those thinking that the Fed must hold off due to all of the weakening macro, saw exactly that in this report.  When removing the seasonal adjustments, that 151K for NFP, becomes -3K.  Yep, that’s right, for the third month in five, this nation saw net job losses, not growth.  Seasonal adjustments are ironed out in the end, so while I do not believe in them, I do acknowledge the argument made by those who do.  Bottom line…those numbers on Friday do not support any kind of monetary policy going forward whatsoever.  Hence, uncertainly …always gnawing at traders, even on the best of days, has run amok.
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Allocation Change
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                         Oh, and while markets burn through support levels, everybody’s watching Gold, right?  If you’ll recall, I doubled my allocation for precious metals from 2.5% to 5% with the new year.  It appears (at least to me) that this was a bit too timid.  With the help of a suddenly less strong dollar, the yellow metal is up 11% this year so far, and is once again acting like a safe haven.  While I never tell anyone what to do… I just tell you what I’m doing, or thinking of doing….. with all of the uncertainly surrounding the state of the economy, and with all of us stuck in at least an “earnings recession”, I’m taking my precious metals allocation up to 7.5%.  The extra 2.5% will come out of my equity allocation, dropping it to 40%.  Cash remains at 35%, and bonds remain at 17.5%, with the concentration still on Treasuries.  Not a genius, so don’t think for a second that I am.  A ton of folks you meet everyday are very smart.  You can’t control things like raw IQ, or natural talent.  You can control work ethic.  Control what you can.  Let no human outwork you.  Not ever.
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Monday’s Earnings Highlights
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Before the Open: DO (.52), HAS (1.30), L (.77)
After the Close: OI (.40), YELP (.12)
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Super Bowl Note:  Call me crazy, but last night I felt like I was watching an old, open outcry auction market trader, with the help of those around him rise above.  He used what he had, and his guts to beat the younger, faster prototype that represented the new way of doing things.  Now imagine a market structure that valued price discovery over micro-second executions…ahhhh.  My alarm’s ringing.

Market Recon Friday

Good Morning,
                        So, I was in attendance last night at the MNI sponsored event at which Cleveland Fed Pres. Loretta Mester spoke.  Ever been the dumbest kid in a room full of 200 people?  Well, I can no longer say that I don’t know how that feels.  She spoke for about 45 minutes, and then they went into a question, and answer session.  My hand was up the whole time, but well, I was not called upon.  Perhaps they read my notes.  I was recognized by a few folks.  There were a few points made by Pres. Mester that stuck in my head.  Before I comment, she does seem very likable in person, so we do have that.
                       To Mester’s credit, she sounded as if,  while she thinks that normalization of policy is where we need to go, that any shock to the economy could change, or at least prolong her outlook on the progress of such policy.  Well, lah-di-dah.  Pretty sure that’s a part of every speech.  What I found extremely troubling, as I am sure every other economist in the room did…was though she did slip at one point, and refer to the recent “soft patch” in the macro…. for the most point, she stuck to the mantra the economy is fundamentally sound, growing at a moderate pace, and that it pretty much just needs to stay on track.  She went as far as mentioning that once the Fed Funds Rate gets to 1%, we can start tackling the balance sheet.
                       Mester also was asked about, and did her best to avoid saying anything substantive on the subject of diverging monetary policy among the world’s central banks.  She said, the US economy is different, which it is, but she did not color that answer with much detail.  She sounded, to me, kind of like a football coach of an 0-16 team game-planning the Super Bowl, you know, just in case.  She did acknowledge recent market volatility, but in my opinion, she downplayed this as somewhat normal.  (I’ve been in the markets since many of you were in diapers, and….this ain’t normal)  I just felt as if she wrote most of the speech four months ago, and never really  bothered to edit, or revisit said speech before delivering it.  Either that, or I very simply was not the dumbest kid in a room full of 200 people.
 
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The Employment Situation  (January)
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08:30 ET
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            There are many, many moving parts to the BLS report, but some of them won’t matter to traders, and some of them matter far more than other to the ground level US economy.  We don’t live in castles here.  We pretty much tell you the truth, even if isn’t real pretty, and even if it isn’t what the powers that be happen to be selling today.
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Non-Farm Payrolls:  For trader types, this is the one that moves the marketplace.  In December, we saw a “very strong” 292K in this space, which we all know was built with smoke and mirrors.  Today, consensus view is for 189K, which is close to being smack dab in the middle of the 170K to 215K range.  It is hard to say how the number today will be received.  With almost all of the US macro over several months now representing an economy that appears to be falling off of a cliff, would a second consecutive beat for NFP be poorly met by Mr. Market?  Oddly, there was very little talk on this item yesterday on the trading floor.  It’s usually a much higher priority with the crowd during “Jobs Week”.
Average Hourly Earnings:  Probably the second most important slice of the Employment pie for traders.  We are looking for a m/m increase in this space of 0.3%, which would be very welcome after last month’s 0.0%.  Any kind of lift in wages has been a very long time coming for plenty of folks on Main Street.  We have had several false starts for this one over the last half year or so, including two 0.4% m/m pops that found no traction.
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Participation Rate:  Taken far more seriously than the Unemployment Rate these days.  This item is mired near incredibly low levels.  That said, December’s 62.6% was the product of two consecutive increases in this space.  What was once awful looks a lot less awful when you’re moving the other direction.  After what we’ve been through in this space, baby steps are fine.
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Underemployment Rate or U-6:  This one not only includes the unemployed, but those working part-time who would prefer to work full-time.  In December, the BLS reported this one at 9.9%.  Just so your not buying your groceries all in the same place, for comparison’s sake, Gallup, the only other folks I know of who attempt to release a US Underemployment Rate, happened to print their number at 14% for December.  At least the two are close.  Uhm yeah.  Somebody’s wrong here.
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Unemployment Rate:  This one has completely fallen off of the radar in the financial community, perhaps because of the absurdity of throwing the long term unemployed out of the total, being labeled as discouraged.  That may have worked back when finding a job was almost as easy as looking for one.  Last month this print came in at 5.0%, and that is the expectation for today.  For your information, last month, Gallup printed this item at 5.5%.  Again…. pay no attention to that man behind the curtain.
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Other Macro
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08:30 ET
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Trade Balance  (December):  For the trading community, this one will pass by quietly.  Expectations are for something close to $-43.0B, with the Exports print coming in under $182B.
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13:00 ET
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Baker Hughes Rig Count (Weekly):  Last week, this data-point saw a drop in North American active rigs drop from 887 to 850, with 19 out of the 37 rigs that ceased operation being Canadian.  A further drop in this number would be a welcome boost for Crude, which under-performed most of the commodity complex yesterday.
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15:00 ET
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Consumer Credit (December):  Total credit increased in November by $14.0B, with $5.7B of that number coming in the form of revolving credit.  That, for those of you who do not follow this closely…was a big increase in the use of credit cards.  Many of these palookas are crowing about how confident that means you all are in the economy.  I suspect that somewhat less triumphant forces may be at work here.  Maintaining your standard of living becoming an issue?  What says you?
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Friday’s Earnings Highlights
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Before the Open: AON (2.10), EL (1.10), MCO (1.04), TSN (.89), USG (.32), WY (.24)
After the Close:  Dreaming about my next disgusting plate of nachos.  Oh, so close.
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Super Bowl Prediction:  Let’s go Mets.