Markets Dove and Didn't Recover

[Excerpted from Bill Cara's Daily Report]

Wednesday started with a dive and then sold lower through the session for US equities. The broad market indexes never could muster a small intra-day rally, closing down about -3.0%. The Russell 2000 small cap index was down -4.72%.

At the close, the DJIA (8,284.89 -184.22 -2.18%), S&P 500 (883.92 -24.43 -2.69%) and NASDAQ Composite (1,664.19 -51.73 -3.01%) were hammered.

The Toronto Composite (9,709.51 -368.19 -3.65%) and Toronto Venture Board (1,053.53 -24.74 -2.29%) also closed well down on the day.

In NY, the leader was Healthcare (XLV -0.2%), and only the Pharmaceuticals industry group ($DRG +0.5%) was showing any life. The Financials (XLF -5.1%) were led south by the RITs ($DJR -7.0%) and Banks ($BKX -6.5%).

There were only seven Cara 100 company stocks that closed higher. The leaders were China National Offshore Oil (CEO +1.9%) and Potash Corp (POT +1.7%). POT was a leader the previous session as well (+6.2%). The losers were headed by Teck Corp (TCK -17.1%), Brunswick Corp (BC -14.0%) and Russian company Mobile TeleSystems (MBT -12.7%). BC had also dropped -10.7% the previous session, which is a sign that credit markets are tightening.

Earlier Thursday, prices were lower in Asia Pacific markets. Japan’s Nikkei 225 (9,093.7 -2.64%), Aussie All Ordinaries (3,710.8 -3.43%) and Hong Kong Hang Seng (16,541.7 -3.04%) were significant losers, while the Shanghai Composite (2,639.9 -0.90%) and India’s BSE 30 (11,872.9 -1.22%) also closed lower. The French CAC (3,122.3 8:22AM ET -0.97%), German DAX (4,692.5 8:07AM ET -0.74%) and UK FTSE 100 (4,330.1 8:07AM ET -0.03%) were weak ahead of the US PPI inflation data, which came in a couple minutes later a bit worse than expected.

Wednesday, the US long Bond ($USB 122.94 +0.92 +0.76%) gained strength on the worsening retail numbers. Traders will be watching individual corporate earnings reports this week, particularly Wal-Mart (WMT). Meanwhile, the 30-year (4.085 -0.72 -1.73%), 10-year (3.105 -0.70 -2.20%), and 5-year (1.958 -0.55 -2.73%) Treasury yields closed lower as traders fled away from equities to the safe haven of bonds.

Accordingly, the $USD (82.62 +0.26 +0.31%) and Yen (104.90 +1.21 +1.17%) swung to a gain. The Euro (135.99 -0.48 -0.35%), Pound (151.60 -1.09 -0.71%), and Cdn Loonie (85.17 -0.85 -0.99%) were all weaker against the USD.

$GOLD futures, however, remained strong (926.60 +3.10 +0.34%).

With the stronger $USD, commodity prices did weaken, led by Crude Oil ($WTIC 58.97 -0.74 -1.24%). Futures were weaker this morning by about a dollar (57.99 -0.98 -1.66% 07:54am ET).

Spot (cash) market prices earlier today were a tad weaker: Gold (920.91 -3.25 -0.35% 08:23am ET), Palladium (220 -2 -0.90% 08:23am ET), Platinum (1098.0 -3.0 -0.27% 08:23am ET), and Silver (13.78 +0.02 +0.15% 08:23am ET).

The Euro futures were a tad weaker earlier (1.3555 -0.0052 -0.38% 08:09am ET).

Stock futures for the DJIA were weaker (8259 -35 -0.42%) at 08:09am ET, but an hour later were down -20.

Comments

[cretin snif...:]

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May 14 10:20 PM

[Andy1234:]

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May 15 08:39 AM

[Colin_hoo:]

These days stock market fluctuated slightly, crude oil prices rose steadily and the financial market continued to recover from its worst time. Now it is the best time to buy into stocks

May 21 04:13 AM