Boeing

It has been exactly six days in which algos, reversing the most recent drop in the S&P with buying sparked by a casual Nikkei leak that the BOJ may, wink wink, boost its QE (subsequently denied until such time as that rumor has to be used again), have pushed the market higher in the longest buying streak since September, ignoring virtually every adverse macroeconomic news, and certainly ignoring an earnings season that is set to be the worst since 2012. Today, the buying streak may finally end on rumors even the vacuum tubes are scratching their glassy heads if more buying on bad or no news makes any sense now that even the likes of David Einhorn is openly saying the second tech bubble has arrived. Keep an eye on the USDJPY which has had seen some rather acute "trapdoor" action in early trading and is approaching 102 after breaching its 55-DMA technical support of 102.38. If the support is broken here we go again on the downside. Keep an eye on biotechs and GILD in particular - if the early strength reverts into more selling again (after the two best days for the biotech space in 30 months), the most recent euphoria phase is now over.

Moving onto overnight markets, apart from China we are seeing broad based gains across most Asian equities. Bourses in Japan, Korea and Australia are up +0.2%, +0.2% and +0.5% respectively whereas the Hang Seng and the Shenzhen Composite indices are down -0.2% and -1.1% as we type. The gains in broader Asia Pacific followed what was another constructive session for risk assets yesterday during US trading hours. The S&P 500 (+0.38%) rose for its 5th consecutive day partly driven by better corporate earnings from the likes of GE and Morgan Stanley. Staying on the results season, we’ve had 70 of the S&P 500 companies  reporting so far and the usual trend is starting to emerge in which earnings beats are faring better than revenue beats. Indeed the beat:miss ratio for earnings has been strong at 77%:23% whereas revenue beats/misses are more balanced at 50%:50%. Looking ahead, markets should get ready for another big week of US earnings.

• Ukraine forces move against separatists (FT)
• China GDP Gauge Seen Showing Deeper Slowdown (BBG)
• China Is Losing Its Taste for Gold (WSJ)
• Regulators Weigh Curbs on Trading Fees (WSJ)
• Obama, Putin Talk as Unrest Roils Eastern Ukraine (WSJ)
• Japan PM talks with BOJ chief, does not push for easing (Reuters)
• BRICS countries to set up their own IMF (RBTH)
• IMF Members Weigh Options to Sidestep U.S. Congress on Overhaul (WSJ)
• Zebra to Buy Motorola Solutions Unit for $3.45 Billion (BBG)
• Chinese Thunder God Herb Works as Well as Pain Therapy (BBG)

The Grand Narrative of the past few centuries goes something like this: from religious authority to secular authority, from agriculture to industrial, from rural to urban, from local to global, from periphery to center, from decentralized to centralized, from low-density energy to high-density energy (from wood to coal to oil/natural gas), from industrial to communication technology, from gold to fiat currencies, from linear to non-linear (complex/fractal), from local scarcity and high cost to global abundance, from islands of prosperity to continents of prosperity, from cash to credit, from collateral to leverage,from productive to consumerist and from sustainable to unsustainable. Many of these linear trends are running out of oxygen or reversing. This is not doom-and-gloom for society--it is only doom-and-gloom for the current unsustainable arrangement (Plan A).

• The counter-HFT-attack begins with first target - dark pools: Dark markets may be more harmful than high-frequency trading (Reuters)
• Malaysia Jet Team Hears Pings Consistent With Black Box (BBG)
• At Toyota as Humans Steal Jobs From Robots (BBG)
• ‘Reverse Auctions’ Draw Scrutiny (NYT)
• Death knell sounds for Brazil’s economic strategy (FT)
• Technology Traders Head for the Exit as Put Trades Surge (BBG)
• NSA Uses Corporate News to Spread Propaganda and Silence Dissent (TruthDig)
• Holcim, Lafarge agree to merger to create cement giant (Reuters)
• Any minute now: Investment Jump Seen From Macy’s to Berkshire After 2013 Fizzle (BBG)
• India kicks off world's biggest election in remote northeast (Reuters)

• Nato chief defends eastern advance (FT)
• Russia looks east as it seeks to rebalance trade interests (FT)
• Plane from Guinea briefly quarantined in Paris after Ebola scare (AFP)
• US attacks Japan’s stance on Trans-Pacific Partnership (FT)
• Thank you IMF: Ukraine PM says will stick to austerity despite Moscow pressure (Reuters)
• U.S. Army seeks motive for Fort Hood shooting rampage (Reuters)
• China Slowdown Adds to Emerging-Market Growth Hurdles, IMF Says (BBG)
• Top investors press Allianz to step up oversight of Pimco (Reuters)
• U.S. to Evaluate Role in Mideast Peace Process, John Kerry Says (WSJ)
• Scientists dismiss claims that Yellowstone volcano about to erupt (Reuters)
• Ukraine detains 12 riot police on suspicion of 'mass murder' (Reuters) - on CIA orders?

• Russia says expects answers on NATO troops in eastern Europe (Reuters)
• Dealers say GM customer anxiety rising, sales may take hit (Reuters)
• China Unveils Mini-Stimulus Measure (WSJ)
• Londoners Priced Out of Housing Blame Foreigners (BBG)
• New earthquake in Chile prompts tsunami alerts (Reuters)
• Ukrainian Billionaire Charged by U.S. With Bribe Scheme (BBG)
• Chinese Investments in U.S. Commercial Real Estate Surges (BBG)
• Old Math Casts Doubt on Accuracy of Oil Reserve Estimates (BBG)
• US secretly created 'Cuban Twitter' to stir unrest (AP)

"The war mongers will continue to use propaganda and misinformation to convince you we are in danger if the war budget is cut by 2%. The truth is that we need to cut the military by 50%, stop trying to operate a world empire, and withdrawal our troops from Germany, Japan, and the dozens of other countries around the globe. We need to stop handing billions of dollars we don’t have to Israel, Egypt and dozens of other countries so they can buy arms from our arms dealers. We are the cause of all the war and violence in this world. The job of our military is to protect our borders, not to police the world. Hubris, arrogance, and overreach, financed by central bank created debt, is how empires die."

There is no reason for Russia to worry about the western sanctions it is facing now over the Ukrainian issue since "Moscow has too many other trade partners to work with," Jim Rogers explains in this interview, adding that "America is shooting itself in a foot getting the most of our world to pushing China and Russia closer together." Simply put, he warns, "I don’t see any sanctions strategy that they can use that will hurt Russia worse than it will hurt the people imposing those sanctions... I think Mr. Obama is making the fool of himself yet again."

• Crimea Resolution Backed by U.S. Barely Gets UN Majority (BBG)
• Russian Buildup Stokes Worries (WSJ)
• As reported here first: China’s Developers Face Shakeout as Easy Money Ends (BBG)
• U.S. House Poised to Clear Sanctions Called Putin Warning (BBG)
• Bitcoin Prices Plunge on Report PBOC Orders Accounts Shut (BBG)
• Search for lost Malaysian jet shifts significantly after new lead (Reuters)
• Russian fund taps China and Middle East (FT)
• Long battle looms between U.S. college, athletes seeking to unionize (Reuters)
• Official warns EU-US trade deal at risk over investor cases (FT)
• New iPhone likely out in September, Nikkei daily says (AFP)

• BOE to Sign Agreement With China on Yuan Clearing Next Week (BBG)
• U.S. law firm plans to bring suit against Boeing, Malaysia Airlines (Reuters)
• Citigroup Fraud Stings Mexico Star as Medina-Mora Chased (BBG)
• Fraternity Chief Feared for Son as Hazings Spurred JPMorgan Snub (BBG)
• UBS suspends six more forex traders (FT)
• Goodbye CSCO Q1 EPS: China to strengthen Internet security after U.S. spying report (Reuters)
• Good luck: Spain Banks With $55 Billion of Property Seek Deals (BBG)
• Citic Pacific Said to Plan About $4 Billion Public Offering (BBG)
• Yahoo Japan to buy eAccess from SoftBank for $3.2 billion (Reuters)
• "Whatever it takes" to talk down the Euro: Euro, peripheral bond yields fall on ECB easing debate (Reuters)

After tumbling overnight to just around 101.80, the USDJPY managed to stage a remarkable levitating comeback, rising all the way to 102.3, which in turn succeeded in closing the Nikkei 225 at the highs, up 1% after tumbling in early trade. The Shanghai Composite was not quite as lucky and as fear continue to weigh about a collapse in China's credit pipeline, the SHCOMP was down more than 0.8% while the PBOC withdreww even more net liquidity via repos than it did last week, at CNY 98 billion vs CNY 48 billion. That said, this morning will be the fifth consecutive overnight levitation in futures, which likely will once more surge right into the US market open to intraday highs, at which point slowy at first, then rapidly, fade again as the pattern has seemingly been set into algo random access memory. Which in a market devoid of human traders is all that matters.

Malaysia Airlines: deeply regret that we have to assume beyond any reasonable doubt that #MH370 was lost and none of those on board survived

— Sky News Newsdesk (@SkyNewsBreak) March 24, 2014

With the world particularly sensitive to any news involving stray and/or missing Boeing 777 airplanes, especially if said massive stray airplane is heading toward the Nuclear security summit taking place at the Hague, it is no surprise that the news which appeared about an hour ago that two Dutch F-16s were scrambled to intercept a unresponsive Boeing 777 in Dutch airspace, received such a prompt response.

A dispassionate look at the main considerations for investors in the week ahead.