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Market Wrap 7.1.09
Equity Wrap
Equity indices benefited from optimism carried over from the European and Asian sessions after better manufacturing reports raised hopes that the global recession is easing. The positive sentiment was given a further boost following an in-line reading for the June ISM manufacturing data. However, the upward momentum was not sustained amid lower volumes, as traders turned their focus to today’s NFP report. Further to that, downbeat comments out of GM related to creditor payments, as well as news that California’s governor has declared a state of “fiscal emergency”, put further pressure on stocks later on in the session. Finally, at the closing bell DJI closed up 0.68% at 8504.06, S&P 500 closed up 0.44% at 923.32 and NASDAQ100 closed up 0.28% at 1481.34.
Fixed Income Wrap
Treasuries were lower during the early hours of trade after investors turned their attention to looming supply in the form of TIPS, 3,10 and 30y notes refunding announcement tomorrow. However, T-notes moved off lows after a lower ADP reading raised concerns the upcoming NFP report may top analyst estimates. T-notes then accelerated their ascent after the Fed bought USD 2.99bln of Treasuries in its latest coupon pass with an offer/cover ratio inline with the previous. Finally, the closing stages saw prices grind higher and at the pit close to finish flat at 116.085.
Source: RANSquawk
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anyone catch the EOD imbalances today? the volumes werent insane but they were easily skewed 19:1 to the buy's. tells me it was big money using vwap algo's to allocate all that "new money" sitting on the "sidelines". if this is the best they can do with all this new cash pouring in, we're in trouble.
Time to accept the fact that Armageddon is a no-show, having stopped off on the way for a shot and a beer and having decided, all things considered, that it would be better to order another round and close the place. Justice is also MIA, and is believed dead. Evidence that the game is rigged is overwhelming, but so what? A sudden collapse of anything you can think of, be it the S&P, CRE, the dollar, gold, U.S Treasuries, or a barrel of oil is not going to happen. Ben, T3, GS, JMP, Paulson etc. have pulled it off, and the monied interests have survived to play another day, albeit at fantastic and almost unimaginable taxpayer expense, but there will be no revolutions, demonstrations, protests or or angry phone calls as life returns to "normal." The long journey that began in September 2008 is ended. Dennis Kneale, the Clown Crier, was right: the Great Recession is officially over, at least in terms of its most fearsome aspects and apocalyptic possibilities. Complete and utter collapse at least was attractive insofar as it might have served as an instrument to correct the great inequalities and grave injustices that have been revealed in the course of the journey. Wipe it clean, and start over would have made sense, but the Powers That Be will live to prey another day. Now remains only the inexorably slow grind forward. If the inevitable cascade of poor earnings reports does not retore the S&P to some semblence of reality, then I would only ask that Zero Hedge add to its burgeoning list of products an official Zero Hedge towel, so I can throw it in, and start paying attention to things that actually make sense.
Ned, here is the simple math. There is about $15 trillion of bad debt that is not completely worthless only because it has the full backing of assorted sovereigns. If you recall from your cap tables, equity only has value if the debt above it is worth par. Patience my friend. Patience. Although good idea on the towel.
Unless it is a government sponsored restructuring or a bail-out. Then the old good cap rule goes out of the window
The worst is yet to come
good finance articles http://www.bit.ly/12NCJR
Madoff's fraud was billions. Geither+Obammi+Ben+Summers+Paulson=trillons. And worst of all, each and EVERY tax payer is a victim though hyperinflation and loss of basic civil infastructures and institutions such as school, roads, and hospitals. Tax payer money isbeing used to bailout banks and to ensure that the economy recovers ASAP so that the wealth gap widens, more credit card debt, and the little people are gouged with surging food
prices, surging gas prices, lack of jobs, and inflation lagging wages. Only the upper eschelons of society will benefit from a 'speedy recovery' It's been that way since 2002.
The worst is yet to come
good finance articles http://www.bit.ly/12NCJR
Every speedy or not so speedy recovery in history was supported by something (new technology leading to increased productivity, global trade or WWII for that matter). Yes, the game is rigged but no matter how many black choppers Ben sends out, monetary tools can not reinvent the economy. So let's face it - the so called service economy where most workers were involved in reselling ever inflating assets to each other and which was supported by ever increasing debt multiples is dead. Chinese built factories for demand which does not exist and western consumers got accustomed to standards of living which they do not earn. Rigged or not there is no going back. So, dear greanshooters, can any of you explain what is going to drive growth in an economy which is morally, economically and financially bankrupt? Without a clear answer to this question any "recovery" would only exist on Madoff's books only.
This guy is very funny.
On the June 29th podcast, he rails against Goldman Sachs like the rest of us....
http://www.philsgang.com/GetPage.asp?ID=443
If you were a Master Criminal working for Goldman's Prop Desk, and you looked at this chart, and could push it up or down easily on a low volume Thursday before a long weekend.
And you wanted to "set the tone" for which way the market would go the rest of the summer...
And if you had to answer to the "Oteam"?
Which way would you push it to exact the maximum amount of pain on the largest number of players??
XLF Daily:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=xlf&sid=...
Hey, I'm just sayin.....
Think like a crook....
Robo, are you unable to post charts? email me at tyler@zerohedge.com if not.
is this a theory or daily musings? volume has been syphoning out the XLF since early may when it went to $13/share. it hasn't been up there since, which confounds me when people talk about financials leading the way.....umm financials have been muted players in this for two months.
let's eat...agreed. i follow bkx pretty closely and talk about a flatliner
glad to see you L_E_A and DH!
There are still mysteries to solve and battles to win--think of how great it may be if the Fed is exposed as a privately held corporation? If the bill gets passed ( and if it doesn't) to audit the fed, there is going to be heat on the masteroverlords of the universe who drive ALL policy--why else would they hire an x-enron lobbyist to bolster their image recently. There is much to lose, and much for our country to gain by regaining our freedom from this cartel.
I say push on with that, and giving the 300 shares of ownership for the federal reserve back to our governments will go a long way in protecting our future as a country.
Ned Zeppelin, i love the zero hedge towel!
Biggest force in the market today was the drop in the dollar -- everything else paled in comparison.