Dow -50.58 at 16279.89, Nasdaq -3.98 at 4752.74, S&P -3.98 at 1938.76
Well today was certainly a very very volatile session. We saw PMI data releasing across the world and we saw a lot of fluctuations in the market. Not to mention the big drop in oil prices after inventories report was out. I feel there are a lot of noises today and that probably kept many traders out. Just a 'sell-high, buy-low' day.
Markets around the world was generally mixed. Asia markets were mostly in red as China's disappointing manufacturing data continues to drag the region down. While Europe markets were somewhat flattish amid weak PMI reports as well.
Market Summary
Industry Watch
Strong: Financials, Health Care, Technology, Utilities
Weak: Energy, Industrials, Materials
Other Market Moving Factor:
- China's preliminary Caixin Manufacturing PMI (47.0; consensus 47.5) drops to a 6.5-year low
[BRIEFING.COM] The major averages registered their second consecutive retreat on Wednesday with the S&P 500 shedding 0.2% while the Nasdaq Composite (-0.1%) ended just ahead.
Overall, the midweek session was a choppy affair that saw the benchmark index spend some time on both sides of its flat line. That trading dynamic resulted from mixed performance among the ten sectors as three top-weighted groups—technology (+0.2%), financials (+0.1%), and health care (-0.1%)—displayed flashes of intraday strength while most of the remaining sectors struggled.
Most notably, commodity-sensitive energy (-1.4%) and materials (-2.1%) finished at the bottom of the leaderboard while the industrial sector (-0.7%) also kept the market under pressure. Altogether, the three sectors responded negatively to last night's release of China's preliminary September Caixin Manufacturing PMI, which fell to a 6.5-year low of 47.0 from 47.3 (expected 47.5).
It is worth pointing out that the energy sector was also pressured by crude oil, which climbed in the morning, but reversed from its best level in a move that coincided with equities retreating from their morning highs. WTI crude continued its retreat into the afternoon, ending the pit session lower by 3.8% at $44.53/bbl.
On the upside, the top-weighted technology sector (+0.2%) settled in the lead thanks to gains among large cap names like Apple (AAPL 114.32, +0.92), Google (GOOGL 653.29, +0.09), Intel (INTC 28.74, +0.07), and Microsoft (MSFT 43.87, -0.03). However, high-beta chipmakers did not fare as well as Intel, evidenced by a 0.7% decline in the PHLX Semiconductor Index.
Elsewhere, financials (+0.1%) and health care (-0.1%) displayed intraday strength, but the health care sector could not stay in the green into the close as renewed weakness in biotechnology took a toll on the countercyclical sector. The iShares Nasdaq Biotechnology ETF (IBB 332.82, -2.58) surrendered 0.8%, extending this week's decline to 6.7%.
Today's choppy action in the stock market had little impact on Treasuries as the 10-yr note spent the day in the red, pushing its yield up two basis points to 2.15%.
Investor participation was on the light side with fewer than 800 million shares changing hands at the NYSE floor.
Economic data was limited to the weekly MBA Mortgage Index, which surged 13.9% to follow last week's 7.0% decrease.
Tomorrow, weekly Initial Claims (Briefing.com consensus 271K), August Durable Orders (expected -2.0%) will be reported at 8:30 ET while August New Home Sales (expected 515,000) will be announced at 10:00 ET.
Global Market
ASIA
Most markets in the Asia-Pacific region fell prone to stepped-up selling pressure following Wall Street’s weak showing on Tuesday and a disappointing flash PMI reading out of China on Wednesday. Specifically, the Caixin Manufacturing PMI reading fell to 47.0 from 47.3, marking a 6 ½ year low. The downbeat survey on manufacturing activity contributed to existing growth concerns for China and the global economy.
Economic Data
- China
- September Caixin Manufacturing PMI 47.0 (expected 47.5; prior 47.3)
- Australia
- CB Leading Index +0.3% month-over-month (prior -0.3%)
- Singapore
- August CPI -0.8% year-over-year (expected -0.5%; prior -0.4%)
Equity Markets
- Japan’s Nikkei: closed for holiday (Autumn Equinox)
- Hong Kong’s Hang Seng declined 2.3%, but had been down as 3.6% in the wake of a disappointing manufacturing survey out of China and reports that Citic Securities has been accused by the Chinese government of front-running state-sponsored stock purchases. Galaxy Entertainment (-5.5%), Kunlun Energy (-5.4%), and China Overseas Land & Investment (-4.7%) led the losses. Out of the 50 index members, only two — China Resources Enterprise (+0.4%) and Hengan International Group (+0.4%) — ended higher.
- China’s Shanghai Composite declined 2.2% after the Caixin flash PMI reading for September checked in at a 6 ½ year low of 47.0, which was also below economists’ average expectation. Once again, there was heightened trading activity in the final hour that was accented with a selling bias.
- India’s Sensex increased 0.7%, recouping a portion of Tuesday’s 2.1% slide. Gains were led by the materials (+0.9%), financials (+0.7%), and health care (+0.7%) sectors. Vedanta (+2.9%), Lupin (+2.7%), and HDFC Bank (+1.8%) were the top-performing stocks. Tata Motors (-1.7%), Bharti Airtel (-1.7%), and Bharat Heavy Electricals (-1.3%) were downside leaders. Out of the 30 index members, 19 ended higher and 11 finished lower.
- Australia’s S&P/ASX 200 declined 2.1% and ended near its lows for the day as growth concerns pressured the market. Loss leaders included the metals & mining (-3.8%), resources (-3.4%), and materials (-3.0%) sectors. Out of the 200 index members, 27 ended higher, 162 finished lower, and 11 were unchanged.
- Regional advancers: None
- Regional decliners: South Korea -1.9%, Taiwan -2.1%, Malaysia -1.4%, Indonesia -2.3%, Singapore -0.8%, Thailand -0.6%, Vietnam -0.1%, Philippines -1.8%
FX
- USD/CNY +0.1% at 6.3839
- USD/INR +0.2% at 66.0137
- USD/JPY +0.1% at 120.25
EUROPE
Major European indices trade higher across the board with UK’s FTSE (+1.9%) in the lead.
- Eurozone preliminary September Manufacturing PMI 52.0, as expected (52.3 prior) and Services PMI 54.0 (expected 54.2; prior 54.4)
- Germany’s preliminary September Manufacturing PMI 52.5 (expected 52.8; last 53.3) and preliminary Services PMI 54.3 (consensus 54.6; prior 54.9)
- France’s preliminary September Manufacturing PMI 50.4 (consensus 48.5; prior 48.3) and Services PMI 51.2 (expected 51.0; last 50.6). Separately, Q2 GDP was flat quarter-over-quarter, as expected (prior 0.0%)
Closing Prices
- UK’s FTSE: + 1.6%
- Germany’s DAX: + 0.4%
- France’s CAC: + 0.1%
- Spain’s IBEX: -0.7%
- Portugal’s PSI: + 0.4%
- Italy’s MIB Index: + 0.2%
- Irish Ovrl Index: + 0.5%
- Greece ASE General Index: -1.3%
Macroeconomic Data
Economic Data
from Briefing.com
- MBA Mortgage Index : 13.9% (Prior -7.0%)
- Crude Inventories : -1.925M (Prior -2.104M)
Market Internals
NYSE:
Lower Volumes than the day before – 782.6M vs 962.0M
Decliners outpaced Advancers (adv/dec): 1254 / 1789
New Lows outpaced New Highs (highs/lows): 10 / 232
NASDAQ:
Lower Volumes than the day before – 1599.8M vs 2022.6M
Decliners outpaced Advancers (adv/dec): 1215 / 1639
New Lows outpaced New Highs (highs/lows): 26 / 145
VOLATILITY S&P500 (VIX)
22.13 -0.31 (-1.38%)
Technical Updates
Volume: 86,032,198 (below average of 112,902,348)
Range: 16,211.98 - 16,355.29
Range: 16,211.98 - 16,355.29
4,752.74 -3.98 (-0.08%)
Volume: 365,126,221 (below average of 468,900,919)
Volume: 365,126,221 (below average of 468,900,919)
Range: 4,735.13 - 4,780.64
1,938.76 -3.98 (-0.20%)
Volume: 505,058,000 (below average of 629,749,708)
Range: 1,932.57 - 1,949.52
It was an inside day for the 3 indices. Despite closing below the resistance at 16,360, DOW managed to still support by its descending trend line. NASDAQ was rejected by its 20MA again and it is barely closing above the support at 4,750. S&P went under its trend line and also approaching a support at 1,925. I suppose we should see a bounce when all 3 indices met their support level but I am unsure if that is going to be a strong or weak one.
Commodities
- Commodities were lower today, led by oil prices. The overall Bloomberg Commodity Index is about 0.6% in current trade
- Despite an initial move higher following the weekly EIA storage data, oil prices collapsed today, falling as low as
- By the end of today’s session, Nov WTI crude lost 3.8% to close at $44.53/barrel, near its LoD of $44.44/barrel
- Oct nat gas only fell one cent to $2.57/MMBtu
- Metals, on the other hand, had a better day
- Copper end flat at $2.30/lb, while precious metals rose
- Dec gold climbed 0.6% at $1131.70/oz, while Dec silver +0.1% at $14.79/oz
Metals
- December gold ended today’s session $7.00 higher (+0.6%) at $1131.70/oz
- December silver closed today’s session $0.02 higher (+0.1%) at $14.79/oz
- December copper closed flat at $2.30/lb
Agriculture
- December corn closed $0.02 higher at $3.83/bushel
- December wheat closed $0.12 higher at $5.07/bushel
- November soybeans closed $0.02 higher at $8.64/bushel
- Sugar #11 closed $0.07 cents higher at 10.95 cents/lb
Energy
- November crude oil futures fell $1.78 (-3.8%) to $44.53/barrel
- October natural gas closed $0.01 lower (-0.4%) at $2.57/MMBtu
- RBOB Gasoline closed $0.02 higher at $1.42/gallon
- Heating oil futures closed $0.02 lower at $1.53/gallon
Currencies
Euro Rallies after Draghi Remarks
- The euro rallied today after European Central Bank President Mario Draghi did not provide strong enough assurance to short-sellers of the single currency that the ECB's asset purchase program would be expanded/extended
- He said that, "More time is needed to determine in particular whether the loss of growth momentum in emerging markets is of a temporary or permanent nature and to assess the driving forces behind the drop in the international price of commodities and behind the recent episodes of severe financial turbulence."
- Also contributing to the rally was the release of purchasing managers' indices for the eurozone, France, and Germany
- In the eurozone, the initial reading of Markit's Composite PMI showed a greater-than-expected fall to 53.9 in September from 54.3 in October
- The internals of the survey were more positive, with faster growth of new work and backlogs of orders
- Markit said that Q3 is shaping up to be the best quarter for the eurozone in 4 years
- EUR/USD: +0.54% to $1.1194
- The U.S. Dollar Index fell 0.14% to 96.15
- GBP/USD: -0.63% to $1.5255
- USD/JPY: +0.20% to 120.25
- USD/CHF: +0.27% to 0.9775
- USD/CAD: +0.45% to 1.3335
- Canadian core retail sales (which exclude autos) were flat m/m in July after rising 0.5% in June. Economists were expecting another gain in July
- Headline retail sales rose 0.5% m/m in July, in line with expectations and outpacing the gain of 0.4% from June
- AUD/USD: -1.17% to $0.6998
- The Conference Board's Leading Economic Indicators index rose 0.3% m/m in July, with 5 out of 7 components rising. That was the first rise for LEI in five months
- The Coincident Index rose 0.2% m/m
- The Conference Board's Leading Economic Indicators index rose 0.3% m/m in July, with 5 out of 7 components rising. That was the first rise for LEI in five months
- NZD/USD: -0.78% to $0.6245
Bonds
Treasuries End Mixed
- U.S. Treasuries flirted with their unchanged marks for most of today's session. They seesawed on the stock market's repeated attempts at rallies and remarks from ECB President Mario Draghi. Oil reversed course lower despite a larger-than-expected draw on crude stockpiles last week and the euro gained against all of the other majors
- Yield Check:
- 2-yr: unch at 0.70%
- 5-yr: +1 bp to 1.44%
- 10-yr: +1 bp to 2.15%
- 30-yr: unch at 2.94%
- News:
- Mario Draghi gave prepared remarks to the European Parliament followed by a question-and-answer session:
- He said that "more time is needed" to assess whether the emerging market slowdown is temporary or permanent and to assess the "driving forces behind the drop in the international price of commodities and behind the recent episodes of severe financial turbulence"
- He said that if the inflation outlook weakens "over the medium term more fundamentally than we project at present, we would not hesitate to act."
- Two members of the ECB's Governing Council, Ewald Nowotny and Bostjan Jazbec, had earlier thrown cold water on investor hopes for a fast-tracked route to ECB balance sheet expansion. Nowotny said that an expansion deserves "a much more thorough examination" and Jazbec said that "It seems that QE is bearing results, so now it's too early to talk about any new policies."
- The MBA Mortgage Index for the week ending 9/19 rose 13.9% versus the prior reading of -7.0%. Much of the activity was from refinancing and analysts attributed it to the uncertainty surrounding the September FOMC meeting
- U.S. crude oil stockpiles fell a greater-than-expected 1.93 mln barrels in the week to September 19. The report by the U.S. Energy Information Administration also showed production rising to 9.13 mln barrels per day
- The $35 bln 5-year note auction was met with strong demand from indirect bidders and stopped through by 0.9 basis points:
- High yield: 1.467%
- Bid-to-cover: 2.57
- Indirect bid: 63.5%
- Direct bid: 5.0%
- Mario Draghi gave prepared remarks to the European Parliament followed by a question-and-answer session:
- Commodities:
- WTI crude: -3.65% to $44.67/bbl.
- Gold: +0.50% to $1,130.40/troy oz.
- Copper: -0.15% to $2.294/lb.
- Currencies:
- EUR/USD: +0.44% to $1.1182
- USD/JPY: +0.18% to 120.23
- Data Out Thursday:
- Initial Jobless Claims for the week ending 9/19 and Continuing Jobless Claims for the week ending 9/12 (08:30 ET)
- August Durable Goods Orders and Durable Goods ex-transportation (08:30 ET)
- August New Home Sales (10:00 ET)
- Natural Gas Inventories for the week ending 9/19 (10:30 ET)
- Treasury Auction:
- $29 bln 7-year note auction (results at 13:00 ET)
- Fed Speaker:
- Fed Chair Yellen (17:00 ET) (FOMC Voter)
Treasury Yields:
- 2 Year Note 0.70% +0.01
- 5 Year Note 1.47% +0.03
- 10 Year Note 2.16% +0.02
- 30 Year Bond 2.95% +0.01
2/30 Spread: 225 bps ( UNCH ) … 2/10 Spread: 146 bps ( +1 )
Preview for Thursday 24 Sept, 2015
Economic Data
Thursday (24 Sept) :
- Initial Claims : 271K (Prior 264K)
- Continuing Claims : 2248K (Prior 2237K)
- Durable Orders : -2.0% (Prior 2.2%)
- Durable Goods - ex transportation : 0.2% (Prior 0.4%)
- New Home Sales : 515K (Prior 507K)
- Natural Gas Inventories : (Prior 73 bcf)
Earnings Highlights
Thursday (24 Sept) :
BMO - WMS
AMC - AVNW FUL JBL SCS WOR
BMO - WMS
AMC - AVNW FUL JBL SCS WOR
Summary
Market has been really weak this week. Basically the weak PMI data around the global economy gave the market a lot of volatility. However it didn't really show any direction in the market. On top of that, oil has been affecting the market movement one way or another.
Furthermore we are expecting Fed Chairperson Janet Yellen to speak at 5pm ET tomorrow. So we could see another volatile session ahead of Friday's GDP number as well.
Market has been really weak this week. Basically the weak PMI data around the global economy gave the market a lot of volatility. However it didn't really show any direction in the market. On top of that, oil has been affecting the market movement one way or another.
Furthermore we are expecting Fed Chairperson Janet Yellen to speak at 5pm ET tomorrow. So we could see another volatile session ahead of Friday's GDP number as well.
Direction for Thursday 24 Sept, 2015: Down
2015 Daily Directional Accuracy: 94/149 (63.09%)
2015 Weekly Directional Accuracy: 22/35 (62.86%)
No comments:
Post a Comment