Dow +267.05 at 18191.11, Nasdaq +58.00 at 5003.55, S&P +28.10 at 2116.10
Big day for the market as there was a huge spike at the opening bell after data from Nonfarm payroll and unemployment rate released. Unemployment rate went down to 5.4%, showing improvement along the way but average hourly earnings did not follow accordingly. Nonetheless market had a superb run at the start and it went totally flat thereafter. This recovers all the losses from short-selling at the start of the week by which telling me the week is literally flat.Friday is going to be a closely monitored session as everyone is waiting for the release of employment numbers in the US. For the past two days, market did not really move much or put it simply - volatile.
I won't be commenting much on the market as bad news might turn out to be good news. But I will be watching the market for the post-movement.
Direction for Friday 8 May, 2015; Abstain
Market Summary
Industry Watch
Strong: Consumer Discretionary, Health Care, Industrials, Technology, Utilities
Weak: Energy
Other Market Moving Factor:
- April Nonfarm Payrolls beat expectations (223K; Briefing.com consensus 218K), but March reading revised down to 85K from 126K: hourly earnings growth disappoints (+0.1%; consensus +0.2%)
- S&P 500 erases week-to-date loss
Equity indices registered the bulk of their gains at the open thanks to a pair of factors that underpinned the sharp spike before the first trade was made in the cash market. First, the UK general election proved surprising as conservatives expanded their presence in the parliament and won 331 of 650 seats. Meanwhile, Ed Miliband (Labour), Nick Clegg (Liberal Democrats), and Nigel Farage (UKIP) resigned from leading their respective parties. Although the results were surprising, markets cheered the preservation of status quo with UK's FTSE surging 2.3%.
Index futures held modest gains following the election results and they extended their gains once the U.S. Nonfarm Payrolls report for April beat expectations (223K; Briefing.com consensus 218K); however, it is worth noting that the March reading was revised down to 85K from 126K and hourly earnings growth remained weak (+0.1%; consensus +0.2%).
The report sparked a fire under equities and Treasuries as lackadaisical wage growth is likely to be used as an argument in favor of the Federal Reserve maintaining its current policy stance for longer. Treasuries soared in reaction to the report, but they retreated from their highs during the afternoon. Still, the 10-yr note ended in the green with its yield down four basis points at 2.14%. The benchmark yield narrowed its weekly increase to two-basis points and ended the week beneath its 200-day moving average (2.19%).
All ten sectors finished the day in positive territory and only three groups posted gains slimmer than 1.0%. Materials (+1.6%) and health care (+1.6%) jockeyed for the lead throughout the session, but the energy sector (+1.6%) overtook them both as part of a late rally. On a related note, crude oil rose 0.7% to $59.42/bbl.
Moving on, the health care sector received a boost from biotechnology with iShares Nasdaq Biotechnology ETF (IBB 351.93, +7.82) spiking 2.3%, and above its 50-day moving average, which had been an area of focus during the past two weeks.
Interestingly, today's broad advance masked the underperformance among a couple other high-beta areas like chipmakers and transport stocks.
The PHLX Semiconductor Index gained 1.0%, but spent the day behind the broader market as NVIDIA (NVDA 20.81, -1.68) weighed. Shares of NVDA fell 7.5% after the company reported in-line results and guided lower. That being said, the broader technology sector (+1.4%) ended a step ahead of the broader market with large cap names like Apple (AAPL 127.52, +2.26), Google (GOOGL 548.95, +6.91), and Microsoft (MSFT 47.75, +1.05) picking up the slack. Microsoft was a standout, climbing 2.3% after Reuters reported the company is no longer looking to acquire Salesforce.com (CRM 72.40, -2.12).
Elsewhere, the industrial sector (+1.2%) settled just behind the broader market even as transport stocks underperformed with the Dow Jones Transportation Average advancing 0.6%. Five components of the bellwether complex registered losses with Landstar System (LSTR 63.18, -0.86) sliding 1.3%.
Today's participation was below recent averages as 759 million shares changed hands at the NYSE floor.
Economic data included Nonfarm Payrolls and Wholesale Inventories:
- Nonfarm payrolls added 223,000 new jobs in April, up from a downwardly revised 85,000 (from 126,000) in March while the Briefing.com consensus expected an increase of 218,000
- Private payrolls increased by 213,000 jobs in April after adding a downwardly revised 94,000 (from 129,000) in March while the consensus expected an increase of 215,000
- The average hourly wage increased 0.1% in April after increasing a downwardly revised 0.2% in March
- The average workweek remained at 34.5 hours for a second consecutive month
- The combination of the increase in payrolls and wages along with constant hours pushed aggregate earnings levels up 0.3% in April. Earnings were flat in March
- The unemployment rate fell to 5.4% in April from 5.5% in March, which met consensus expectations
- Wholesale inventories increased 0.1% in March after increasing a downwardly revised 0.2% (from 0.3%) in February while the Briefing.com consensus expected an increase of 0.3%
- The BEA assumed that wholesale inventories increased 0.6% in the advance Q1 2015 GDP report. The downside miss in March combined with the revisions to February will result in a downward revision to first quarter GDP when the second estimate is released at the end of the month
- Nasdaq Composite +5.4% YTD
- S&P 500 +2.7% YTD
- Russell 2000 +2.3% YTD
- Dow Jones Industrial Average +2.0% YTD
The stock market kicked off the trading week on an upbeat, albeit quiet, note. The Dow and S&P 500 gained 0.3% apiece while the Nasdaq Composite (+0.2%) slipped behind the broader market during afternoon action. "Quiet" was the general theme on Monday as most global equity markets also posted gains while Japan's Nikkei and UK's FTSE were closed for holidays. Seven of ten sectors finished in the green with financials (+1.0%) and utilities (+0.7%) ending in the lead. The countercyclical utilities sector lost the lead during the final hour while financials crept higher throughout the day, also overtaking the health care sector (+0.6%) during afternoon action.
Equity indices ended Tuesday on a sharply lower note following a daylong retreat that was paced by the Nasdaq Composite (-1.6%). For its part, the S&P 500 lost 1.2% with all ten sectors ending in the red. The Tuesday selloff followed an overnight session that featured a 4.1% drop in China's Shanghai Composite after some equity brokers increased their margin requirements, which led to forced selling. Furthermore, markets across Europe also struggled with Germany's DAX diving 2.5% amid spiking yields. To that point, Germany's 10-yr bund yield surged 13 basis points to 0.52% after hovering near 0.16% as recently as last week while Italy's 10-yr yield soared 34 basis points to 1.83%. Rising interest rates were not unique to Europe as the U.S. 10-yr note registered its sixth consecutive decline, sending its yield higher by three basis points to 2.17%. The benchmark yield hit its highest level since early March and spent the day near its 200-day moving average, representing the first appearance near that level in more than a year.
The stock market registered its second consecutive decline on Wednesday with the S&P 500 (-0.4%) bouncing off its 100-day moving average (2,070). The key indices began the day with slim gains, but the Dow, Nasdaq, and S&P 500 quickly returned below their 50-day moving averages and continued lower throughout the day. Adding to the pressure were comments from Fed Chair Janet Yellen who reminded investors that equity valuations are "generally quite high" and that raising the fed funds rate is likely to be followed by a spike in Treasury yields. The opening spike notwithstanding, the Wednesday session was largely a repeat of Tuesday's slide; however, the Nasdaq, which underperformed on Tuesday, retreated alongside the broader market on Wednesday. The major indices cut their losses in half during the final hour, but nine sectors settled in the red with the countercyclical telecom services space (-1.2%) ending behind its peers. More notably, the largest sector by weight—technology (-0.8%)—was the second-weakest performer with large cap names fueling the weakness. Shares of Microsoft (MSFT 46.28, -1.32) tumbled 2.8% while the likes of Apple (AAPL 125.01, -0.79), Google (GOOGL 535.08, -7.96), Oracle (ORCL 43.26, -0.66), and Intel (INTC 32.22, -0.42) lost between 0.6% and 1.5%. It is worth noting that unlike Intel, some other chipmakers outperformed with the PHLX Semiconductor Index shedding just 0.1%.
The market snapped its two-day skid with a Thursday advance that lifted the S&P 500 (+0.4%) into the neighborhood of its 50-day moving average (2,089). The benchmark index narrowed its week-to-date loss to 1.0% while the Nasdaq Composite (+0.5%) outperformed, narrowing its weekly loss to 1.2%. Equity indices vacillated near their flat lines during the opening hour and followed their shaky start with a broad-based rally. However, the cash market masked the fact that S&P 500 futures were down more than 15 points overnight. That weakness coincided with selling in the Treasury market, which abated once the benchmark 10-yr yield kissed the 2.30% level. To be fair, the overnight selloff in Treasuries did not take place in a vacuum as Germany's 10-yr bund endured a sharp plunge that briefly sent its yield as high as 0.79%. German bunds were able to retrace the entire move, returning to 0.59% while U.S. Treasuries did that and then some. The 10-yr note rallied throughout the session, dropping its yield six basis points to 2.18% and back below the 200-day moving average (2.19%).
DOW
NASDAQ
S&P
Global Market
ASIA
Asia Summary: Japan’s Nikkei +0.5%; Hong Kong’s Hang Seng +1.1%; China’s Shanghai Composite +2.3%
Markets in the Asia-Pacific region finished mostly higher on Friday, led by none other than the Shanghai Composite (+2.3%), which rebounded from recent losses following a disappointing trade balance report for April. The latter reportedly ignited a rally predicated on the idea that bad economic news is good news since it is likely to prompt more policy stimulus.
Economic data
- China
- April Trade Balance CNY 34.13 bln (expected CNY 39.45 bln; prior CNY 3.08 bln)
- Exports -6.4% year-over-year (expected +2.4%; prior -15.0%)
- Imports -16.2% year-over-year (expected -12.0%; prior -12.7%)
Equity Markets
- Japan’s Nikkei increased 0.5%. Modest gains were led by the financial (+1.8%) and industrial (+1.2%) sectors. Individual standouts included Maruha Nichiro Corp (+7.6%), Sojitz Corp (+7.1%), and Mitsubishi UFJ Financial (+5.6%). Marubeni Corp (-3.1%), Pioneer Corp (-2.5%), and Kyowa Hakko Kirin (-2.8%) paced the decliners. Out of the 225 index members, 161 ended higher, 52 finished lower, and 12 were unchanged.
- Hong Kong’s Hang Seng added 1.1%, bolstered by gains in the technology (+4.2%), basic materials (+3.4%), diversified (+1.9%), consumer cyclical (+1.3%), and financial (+1.1%) sectors. China Merchants Holdings (+4.5%), Lenovo Group (+4.2%), and China Resources Land (+3.9%) led winning issues. Want Want China Holdings (-3.8%), CNOOC (-2.2%), and China Mengniu Dairy (-1.2%) were the worst-performing stocks. Out of the 50 index members, 33 ended higher, 15 finished lower, and 2 were unchanged.
- China’s Shanghai Composite increased 2.3% following a weaker-than-expected trade report for April that featured a 6.4% year-over-year decline in exports and a 16.2% year-over-year decline in imports. The weak data reignited the policy stimulus speculation trade which helped cut this week’s large losses. For the week, the Shanghai Composite declined 5.3%. ·
- India’s Sensex increased 1.9%, ending near its best levels of the day. Index gains were led by the financial (+2.8%), consumer non-cyclical (+2.3%), and industrial (+2.0%) sectors. Tata Motors (+5.2%), Cipla Ltd/India (+4.3%), and ICICI Bank (+4.1%) sat atop the list of winners while Here MotoCorp (-2.3%) and Oil & Natural Gas Corp (-1.4%) were the only two stocks that fell more than 1.0%.
- Australia’s S&P/ASX 200 declined 0.2%, falling in sympathy with the weak trade report out of China. The index closed at its lows for the session, paced by weakness in the energy (-3.1%), resources (-1.9%), and metals & mining (-1.3%) sectors. For the week, the S&P/ASX 200 was down 3.1%.
- Regional advancers: Singapore +0.6%, Malaysia +0.1%, Thailand +0.8%, Indonesia +0.6%, Vietnam +0.3%
- Regional decliners: Taiwan -0.1%, South Korea -0.3%, Philippines -0.7%
FX
- USD/CNY unch at 6.2080
- USD/INR -0.2% at 63.958
- USD/JPY +0.3% at 120.09
EUROPE
Major European indices trade higher across the board with UK’s FTSE (+2.0%) in the lead after yesterday’s general election proved surprising as conservatives expanded their presence in the parliament and are expected to hold as many as 329 seats. Meanwhile, Ed Miliband (Labour), Nick Clegg (Liberal Democrats), and Nigel Farage (UKIP) have resigned from leading their respective parties.
- Germany’s March Industrial Production -0.5% month-over-month (expected 0.4%; prior 0.2%). Separately, March Trade Balance EUR19.30 billion (expected EUR20.00 billion; prior EUR20.00 billion) as exports +1.2% month-over-month (consensus 0.4%; prior 1.4%) and imports +2.4% month-over-month (expected 0.0%; last 1.3%)
- UK’s Halifax House Price Index +1.6% month-over-month (expected 0.4%; prior 0.6%); +8.5% year-over-year (consensus 7.8%; last 8.1%). Separately, March Trade Balance -GBP10.12 billion (expected -GBP9.80 billion; prior -GBP10.8 billion)
- Italy’s March Industrial Production +0.4% month-over-month (consensus 0.2%; prior 0.7%); +1.5% year-over-year (expected -0.2%; last -0.1%)
- Spain’s March Industrial Production +2.9% year-over-year (consensus 1.2%; last 0.9%)
Closing Prices
- UK’s FTSE: + 2.3%
- Germany’s DAX: + 2.7%
- France’s CAC: + 2.5%
- Spain’s IBEX: + 2.2%
- Portugal’s PSI: + 1.8%
- Italy’s MIB Index: + 2.1%
- Irish Ovrl Index: + 2.3%
- Greece ASE General Index: -0.2%
Macroeconomic Data
Economic Data
from Briefing.com
- Nonfarm Payrolls : 223K vs 218K (Prior 85K - Down)
- Nonfarm Private Payrolls : 213K vs 215K (Prior 94K - Down)
- Unemployment Rate : 5.4% vs 5.4% (Prior 5.5%)
- Hourly Earnings : 0.1% vs 0.2% (Prior 0.2% - Down)
- Average Workweek : 34.5 vs 34.5 (Prior 34.5)
- Wholesale Inventories : 0.1% vs 0.3% (Prior 0.2% - Down)
NONFARM PAYROLLS / EMPLOYMENT REPORT
Highlights
- Nonfarm payrolls added 223,000 new jobs in April, up from a downwardly revised 85,000 (from 126,000) in March. The Briefing.com Consensus expected nonfarm payrolls to increase by 218,000.
- Private payrolls increased by 213,000 jobs in April after adding a downwardly revised 94,000 (from 129,000) in March. The consensus expected private payrolls to increase by 215,000.
- The average hourly wage increased 0.1% in April after increasing a downwardly revised 0.2% in March. The average workweek remained at 34.5 hours for a second consecutive month.
- The unemployment rate fell to 5.4% in April from 5.5% in March. That met consensus expectations.
Key Factors
- Heading into this report, the focus was to see if the labor market improved enough to justify a rate hike occurring closer to July than December. In our opinion, this report did nothing to change the conditions that still warrant very easy monetary policy.
- All in all, the employment data were pretty consistent with expectations. Yet, those expectations really weren't anything that special, especially after considering the weakness that came in March.
- The reality is that labor market conditions have materially improved, and the claims data suggest that jobs are at their most secure point in 15 years. Businesses, however, have little desire to add to their current workforce and are content to keep production levels stable.
- The combination of the increase in payrolls and wages along with constant hours pushed aggregate earnings levels up 0.3% in April. Earnings were flat in March.
- With core CPI growing at a stable 0.2%, the aggregate gains in income barely exceed inflation growth. Without a dip in the elevated savings rate, real spending growth is likely to remain weak.
- What’s more is that the increase in aggregate earnings was not strong enough to push businesses to raise prices beyond their current trend. An acceleration in inflation, which could force the Fed to pull the trigger on a rate hike earlier than they necessarily want, does not seem to be in the cards.
- The decline in the unemployment rate was a result of stronger employment growth as opposed to a drop in the labor force participation rate. That is a good sign for the economy.
Big Picture
- Despite the rise in payrolls and the tick down in the unemployment rate, the lack of strong income growth will likely keep Fed policy firmly planted.
WHOLESALE INVENTORIES
Highlights
- Wholesale inventories increased 0.1% in March after increasing a downwardly revised 0.2% (from 0.3%) in February. The Briefing.com Consensus expected wholesale inventories to increase 0.3%.
Key Factors
- The BEA assumed that wholesale inventories increased 0.6% in the advance Q1 2015 GDP report. The downside miss in March combined with the revisions to February will result in a downward revision to first quarter GDP when the second estimate is released at the end of the month.
- Durable goods inventories increased 0.5% in March after increasing 0.4% in February. Increases in professional equipment (0.9%), hardware (1.0%), and electrical (1.4%) inventories more than offset declines in lumber (-0.8%) and metals (-0.3%).
- Nondurable goods inventories declined 0.4% in March after declining 0.1% in February. Despite higher petroleum prices, petroleum inventories declined 4.3% in March.
- Wholesale sales declined 0.2% in March after declining 0.6% in February. Much of the decline was the result of a 7.0% decline in farm products and a 5.1% decline in petroleum sales.
- The inventory-to-sales ratio remained at 1.30 in March.
Big Picture
- Wholesale inventories are just one component of total business inventories. Manufacturing and retail inventories make up the rest of total business inventories. The market ignores this release and doesn't pay much attention to the full business inventory release that comes a few days later. Improved inventory management in recent years has reduced the economic swings associated with inventories and has helped produce a long-term downtrend in the inventory-to-sales ratio.
Market Internals
NYSE:
Lower Volumes than the day before – 725.6M vs 807.1M
Advancers outpaced Decliners (adv/dec): 2490 / 605
New Highs outpaced New Lows (highs/lows): 75 / 31
NASDAQ:
Lower Volumes than the day before – 1954.7M vs 2032.0M
Advancers outpaced Decliners (adv/dec): 1754 / 1035
New Highs outpaced New Lows (highs/lows): 75 / 48
VOLATILITY S&P500 (VIX)
12.86 -2.27 (-15.00%)
12.86 -2.27 (-15.00%)
Internals were reflecting quite a bullishness however with a lower volume. So chances are the market is going to break higher still yet to be told. VIX gap down as market rocketed and went below both its 20 and 50MAs. In my opinion the internals are not that convincing for a bullish state given the volume and lets see how the market react next week first.
Technical Updates
18,191.11 +267.05 (+1.49%)
Volume: 94,958,321 (below average of 99,222,227)
Range: 17,933.64 - 18,205.23
Range: 17,933.64 - 18,205.23
5,003.55 +58.00 (+1.17%)
Volume: 450,650,462 (above average of 434,810,062)
Volume: 450,650,462 (above average of 434,810,062)
Range: 4,989.26 - 5,014.33
S&P 500 INDEX (SPX: CBOE)
2,116.10 +28.10 (+1.35%)
Volume: 524,517,000 (below average of 531,598,923)
Range: 2,092.13 - 2,117.66
S&P is hitting its resistance level while DOW is more or less similar. NASDAQ is not showing more bullishness from the candlestick pattern. Even so, all 3 indices are still above their respective 20 and 50 MAs. We might see more upside coming but only if they could overcome the resistance level.
Commodities
Commodities
Closing Commodities: WTI Oil Closes Above $59/Barrel
Energy
Agriculture
Metals
Dollar Index Virtually Unchanged
Bonds
- Energy futures had a mixed day with oil and natural gas futures trading higher and heating oil and RBOB flat
- June crude ended the day +$0.44 at $59.42/barrel, while June nat gas rallied $0.15 to $2.88/MMBtu
- Metals rose today as well
- June gold gained +$6.80 to $1189.10/oz, July silver rose $0.16 to $16.48/oz and July copper increased by $0.01 to $2.92/lb
- Sugar futures rallied 3.5% today to $13.42/lb
Energy
- June crude oil futures rose $0.44 to $59.42/barrel
- June natural gas closed $0.15 higher at $2.88/MMBtu
- RBOB Gasoline closed flat at $1.99/gallon
- Heating oil futures closed flat at $1.96/gallon
- The Baker Hughes total US rig count declined by 11 to 894
Agriculture
- July corn closed $0.03 higher to $3.64/bushel
- July wheat closed $0.09 higher to $4.82/bushel
- July soybeans closed flat at $9.75/bushel
- Ethanol closed $0.02 higher at $1.66/gallon
- Sugar #11 closed 0.46 cents higher (+3.5%) to 13.42 cents/lb
Metals
- June gold ended today’s session $6.80 higher to $1189.10/oz
- July silver closed $0.16 higher at $16.48/oz
- July copper closed $0.01 higher to $2.92/lb
Currencies
- The U.S. Dollar Index is up 0.15% to 94.78, gaining against the euro and Swissy and losing against the pound and commodity currencies
- EUR/USD: -0.09% to $1.1233
- German Industrial Production unexpectedly fell 0.5% m/m in March versus a 0.2% increase in February
- USD/JPY: -0.04% to 119.69
- AUD/USD: +0.35% to $0.7928
- NZD/USD: +0.35% to $0.7929
- USD/CHF: +0.83% to 0.9298
- Swiss unemployment for April came out in line with expectations at 3.3% verus 3.4% in March
- USD/CAD: -0.26% to 1.2079
- GBP/USD: +0.41% to $1.5460
- The victory of the Conservative Party in Thursday's national election supported demand for pound sterling as David Cameron's government is predicted to continue tight fiscal policy
- The Halifax House Price Index rose 8.5% y/y in April, better than expected and beating the 8.1% jump in March
Bonds
Treasuries Rally After Employment Report
- An April Employment Situation Report from the Department of Labor helped the Treasury complex extend its relief rally to two days. The curve steepened during the rally, which was a bit strange because the curve steepened during the three-week bond sell-off as well
- Yield check:
- 2-yr: -6 bps to 0.58%
- 5-yr: -7 bps to 1.49%
- 10-yr: -4 bps to 2.14%
- 30-yr: -2 bps to 2.89%
- News:
- After a very volatile week in European government debt, Friday's session was notably less volatile with most country's bonds little changed by the U.S. Treasury open
- Nonfarm payrolls added 223,000 new jobs in April, up from a downwardly revised 85,000 (from 126,000) in March. The Briefing.com Consensus expected nonfarm payrolls to increase by 218,000
- Average hourly earnings increased by 0.1% in April, less than the Briefing.com consensus of +0.2% and the March's downwardly revised +0.2%
- Potential traction on the wage growth front has been cited by some market observers as a potential catalyst for the sharp drop in Treasuries over the past couple of weeks. The fact that wage growth turned out not to be a risk combined with the 30-year's sluggishness today implies that wage growth was not the problem for bonds
- Labor market conditions have materially improved, and the claims data suggest that jobs are at their most secure point in 15 years. Businesses, however, have little desire to add to their current workforce and are content to keep production levels stable
- The unemployment rate fell to 5.4% in April from 5.5% in March. That met consensus expectations
- Wholesale inventories increased 0.1% in March after increasing a downwardly revised 0.2% (from 0.3%) in February. The Briefing.com Consensus expected wholesale inventories to increase 0.3%
- The BEA assumed that wholesale inventories increased 0.6% in the advance Q1 2015 GDP report. The downside miss in March combined with the revisions to February will result in a downward revision to first quarter GDP when the second estimate is released at the end of the month
- Commodities:
- WTI Crude: +0.70% to $59.35/bbl
- Gold: +0.46% to $1,187.60/troy oz.
- Copper: +0.02% to $2.9185/lb.
- Currencies:
- EUR/USD: -0.30% to $1.1210
- USD/JPY: +0.03% to 119.77
- Week Ahead:
- Monday: No Data
- Tuesday: March JOLTS -- Job Openings (10:00 ET); April Treasury Budget (14:00 ET); $24 billion 3-year note auction (13:00 ET); San Francisco Fed President Williams (FOMC voter) speaks before the NY Association for Business Economics (12:45 ET)
- Wednesday: MBA Mortgage Index for the week ending 05/09 (07:00 ET); April Retail Sales and Retail Sales ex-auto (08:30 ET); April Export Prices ex-agriculture and Import Prices ex-oil (08:30 ET); March Business Inventories (10:00 ET); Crude Inventories for the week ending 05/09 (10:30 ET); $24 billion 10-year note auction (13:00 ET)
- Thursday: Initial Jobless Claims for the week ending 05/09 and Continuing Jobless Claims for the week ending 05/02 (08:30 ET); April PPI and Core PPI (08:30 ET); Natural Gas Inventories for the week ending 05/09 (10:30 ET); $16 billion 30-year bond auction (13:00 ET)
- Friday: May Empire Manufacturing (08:30 ET); April Industrial Production and Capacity Utilization (09:15 ET): May Michigan Sentiment (10:00 ET); March Net Long-Term TIC Flows (16:00 ET)
Treasury Yields:
- 2 Year Note 0.59% -0.04
- 5 Year Note 1.50% -0.05
- 10 Year Note 2.16% -0.02
- 30 Year Bond 2.90% UNCH
2/30 Spread: 231 bps ( +4 ) … 2/10 Spread: 157 bps ( +2 )
Preview for the week Monday 11 May to Friday 15 May, 2015
Economic Data
Monday (11 May) :
- No Economic Data
- JOLTS - Job Openings : (Prior 5.133M)
- Treasury Budget : $155.0B (Prior $106.9B)
- MBA Mortgage Index : (Prior -4.6%)
- Retail Sales : 0.2% (Prior 0.9%)
- Retail Sales ex-auto : 0.4% (Prior 0.4%)
- Export Prices ex-agri : (Prior 0.2%)
- Import Prices ex-oil : (Prior -0.4%)
- Business Inventories : 0.2% (Prior 0.3%)
- Crude Inventories : (Prior -3.882M)
- Initial Claims : 275K (Prior 265K)
- Continuing Claims : 2300K (Prior 2228K)
- PPI : 0.2% (Prior 0.2%)
- Core PPI : 0.1% (Prior 0.2%)
- Natural Gas Inventories : (Prior 76 bcf)
- Empire Manufacturing : 4.0 (Prior 1.2)
- Industrial Production : 0.1% (Prior -0.6%)
- Capacity Utilization : 78.4% (Prior 78.4%)
- Michigan Sentiment : 96.0 (Prior 95.9)
- Net Long-Term TIC Flows : (Prior $9.8B)
Earnings Highlights
Monday (11 May) :
BMO - MBLY WBAI ACT AER AES AKRX CNP CRK CNNX CUI CVT DF DISH ENDP EVEP FRM BRSS GWPH ICPT LGND MGIC MHR FISH NSSC NTWK NAT PLUG RDNT RBC BID STRL SSYS TICC UCP VRTS W
AMC - AMBC APP APEI ASEI ARCW ARNA ATHX BDE BOX CHMI CLNE CYTX DEPO DPLO DRYS DTSI ELON EGL EAC EVDY FMC FMI FTEK FF FXEN GTY GLPW GBDC HALO HI IPXL IPAR XON JUNO LPSN EVAR MCUR CALL MNTX MTZ MVNR MBI MDR MCC MR MODN MRH NCMI ORIG OME OMER ONTY OPK OESX PEIX PAAS PVA PAHC PINC PRSC RAX REN RNET SCLN SFXE SF SCAI TEP TTEC TCRD TRQ UNXL VRTU YY ZGNX
BMO - MBLY WBAI ACT AER AES AKRX CNP CRK CNNX CUI CVT DF DISH ENDP EVEP FRM BRSS GWPH ICPT LGND MGIC MHR FISH NSSC NTWK NAT PLUG RDNT RBC BID STRL SSYS TICC UCP VRTS W
AMC - AMBC APP APEI ASEI ARCW ARNA ATHX BDE BOX CHMI CLNE CYTX DEPO DPLO DRYS DTSI ELON EGL EAC EVDY FMC FMI FTEK FF FXEN GTY GLPW GBDC HALO HI IPXL IPAR XON JUNO LPSN EVAR MCUR CALL MNTX MTZ MVNR MBI MDR MCC MR MODN MRH NCMI ORIG OME OMER ONTY OPK OESX PEIX PAAS PVA PAHC PINC PRSC RAX REN RNET SCLN SFXE SF SCAI TEP TTEC TCRD TRQ UNXL VRTU YY ZGNX
Tuesday (12 May) :
BMO - WMS ACM ARCO ARES ATRO CRCM DCIX EGRX ECA FMSA IBP IFF LDOS NAVB NAO OTIV SKYS
AMC - PRSS CARA CDNA DCO ESIO EXAR FIVN HMIN HDP INGN LMNS MCK NEWR NVMI OPWR PE RENN RSPP SSRI STKL TUBE VTAE VTL VSLR ZFGN Z
Wednesday (13 May) :
BMO - AGTC ARMK ACAT CRME DSX EZCH IDRA IGT M MRKT MTLS RL PCP SHLX ELOS ZAYO ZBRA
AMC - BLCM CTRE CSCO CTRP DANG XONE FPRX JCP JACK LXFT NTES FENG PFIE RNDY SHAK SPKE STB TGB VIPS VOXX WX
Thursday (14 May) :
BMO - BDRBF CMGE CSTM CYRN GIL HIMX HSGX KITE KSS MMYT MANU NCFT PERY PFNX PBH PPP QIWI STOR TK TNK PLCE VWR
AMC - AMAT ANET HTHT CSC DAR DDS EXP LOCO GLOB JYNT KING MDLY JWN QUNR RLGT SANW SINA SYMC UPLD VCYT WB
Friday (15 May) :
BMO - HGG JMG OCUL TNP
AMC - None
Summary
Last week market movement was volatile as we were expecting Nonfarm payroll data. Friday session was merely significant at the opening 1 hour. We can see that market is unlikely to break higher judging from the reaction. However I will still be looking at how the market opens next week before jumping to any conclusion. Meanwhile I think the employment report is kinda mixed as I am still skeptical about the general condition with average earnings remaining relatively flat.
I think we would see some profit taking next Monday but I don't feel quite confident or convincing for the market to rally now. Maybe my hunch is telling me Sell in May and go away.
I think we would see some profit taking next Monday but I don't feel quite confident or convincing for the market to rally now. Maybe my hunch is telling me Sell in May and go away.
Direction for Monday 11 May, 2015; Down
2015 Weekly Directional Accuracy: 9/16 (56.25%)
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