View From The Hill: August-13-2015

Posted on Posted in Views From The Hill

Market Summary

Well, as mentioned a few days earlier, the bulls and bears are clearly on a collision course as evidenced by the market’s recent tendency to make higher lows and lower highs. This sets up the high probability for a strong bullish or bearish move as one side blinks or capitulates. For clues, one could look to the bond market which seems to be doubting whether the Fed has enough moral authority to hike rates. Then again, even the smart money can be thrown for Fed head fakes. These days the truly smart money is parking in real estate, an asset class which lately seems to be impervious to the market as demonstrated by the Dow Jones Real Estate and Homebuilder indexes.

Market breadth for the SP-500 components was biased towards bearishness as advancers (209) lagged decliners (286). New 5-day highs (114) outpaced new 5-day lows (34) and new 52-week highs (45) outnumbered new 52-week lows (30). Key reversals sent us a strong message with bears (154) dominating bulls (6). So much for techinical indicator favoring a bullish market condition. Haha…

Index

Price

Change

SP-500 2083.39 -2.66 / -0.13%
Nasdaq-100 4519.32 -8.87 / -0.20%
Russell-2k 1204.74 -4.24 / -0.35%
VIX 13.49 -0.12 / -0.88%
10 Yr Tsy Note Rate 2.18 +0.05 / +2.35%
30 Yr Tsy Bond Rate 2.85 +0.04 / +1.42%
US Dollar Index 96.38 +0.07 / +0.07%
Gold (Cash)
1114.80 -9.46 / -0.84%
WTI Crude Oil (Cash)
42.25 -0.98 / -2.27%
DJ Real Estate Index 295.35 +0.23 / +0.08%
DJ Homebuilders Index 596.17 +11.03 / + 1.85%

Volume Surging Stocks

Stock prices increasing on high volume
  • Hartford Financial Services Group (HIG) @ 48.82 (+2.82%) on 365% volume surge
  • Advanced Auto Parts Inc (AAP) @ 187.79 (+9.18%) on 250% volume surge
  • News Corp (NWSA) @ 15.19 (+7.58%) on 184% volume surge
  • Noble Energy Inc (NBL) @ 36.30 (+2.80%) on 165% volume surge
  • Cisco Systems Inc (CSCO) @ 28.70 (+2.87%) on 149% volume surge
Stock prices declining on high volume
  • Kohl’s Corp (KSS) @ 56.11 (–8.76%) on 442% volume surge
  • Keurig Green Mountain (GMCR) @ 50.28 (-4.93%) on 134% volume surge
  • Oneok Inc (OKE) @ 36.34 (-3.73) on 130% volume surge
  • Tesoro Corp (TSO) @ 104.41 (-4.54%) on 105% volume surge
  • Quanta Services Inc (PWR) @ 24.19 (-3.01%) on 86% volume surge

Market Moving Events

Bullish

  • Economy / Consumer / USA: Retail Sales for July-2015 increased mth/mth to 0.6% vs. consensus @ 0.5% and prior revised @ -0.0%.
  • Central Banks / Monetary Policy / China: The PBOC issued a rare statement in which it affirmed its support for a strong and stable currency and that it sees most of its work already done with regards to adjusting the value of the Yuan.
  • Equities / Earnings / Technology: Cisco Systems (CSCO) exceeded earnings and revenue expectations for FY2015-Q4. EPS were @ $0.52 vs. consensus @ $0.51 while revenue was @ $12.8bn vs. consensus @ $12.63bn.

Bearish

  • Economy / Inflation / USA: Monthly economic data for July-2015 indicates that Import Prices declined -0.9% vs. consensus @ -0.1% and prior revised @ 0.0%, while Export Prices dropped -0.2% vs. consensus @ -0.3% and prior revised @ -0.3%.

Neutral

  • Central Banks / Monetary Policy / Europe: The ECB remains steadfast in its position to maintain an accommodative monetary policy. The financial situation in Greece is contained but it is poised to act if necessary. Meanwhile, it perceives China’s economic slowdown as having potential for larger than expected negative global impact and a Fed rate hike being a deterrent for growth in the U.S. and emerging markets.
  • Economy / Inventories / USA: Business Inventories for June-2015 ticked up considerably to +0.8% vs. consensus @ +0.3% and prior revised @ +0.3%. Much of the increase is being attributed to the Auto Industry which is experiencing strong sales.
  • Economy / Employment / USA: Despite an increase, Jobless Claims for the week of August-8-2015 remain at historically low levels, i.e. actual @ 274k vs. consensus @ 270k and prior revised @ 269k.
  • Economy / Inflation / Germany: CPI data for July-2015 remained flat @ 0.2% vs. consensus @ 0.2% and prior @ 0.2%.
  • Economy / Inflation / France: CPI data for July-2015 was in line with monthly expectations @ -0.4% vs. consensus @ -0.4% and prior @ -0.1%. Annually, it dipped slightly to 0.2% vs. forecasts @ 0.3% and prior @ 0.3%.

 

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