And You Thought Friday Was Boring

[Excerpted from Bill Cara's Daily Report]

And we thought Friday was boring! If you left the room Monday for 30 minutes early in the session, you could be excused for thinking traders were taking an all-day siesta. Forex and bond prices barely budged, and volume in the equity market was pathetic.

Prices of equities did advance however. At the close, the S&P 500 (927.23 +8.33 +0.91%), the DJIA (8,529.38 +90.99 +1.08%), and the NASDAQ (1,844.06 +5.84 +0.32%) were all firmer thanks to the early session boost.

The Toronto Composite (10,476.77 +87.01 +0.84%) and the Toronto Venture Board (1,105.56 -6.00 -0.54%) headed in different directions. The main board in Toronto has had a string of five positive sessions.

Earlier Tuesday, Austral-Asian markets were mixed. Japan’s Nikkei 225 (9,958.4 +1.79%), and Aussie All Ordinaries (3,947.8 +1.68%) were winners, but Hong Kong (18,378.7 -0.81%), Shanghai (2,959.4 -0.54%), and India’s BSE 30 (14,493.8 -1.97%) were losers.

As for the European equity bourses, prices were almost flat. The French CAC (3,190.4 6:37AM ET -0.10%), German DAX (4,888.4 6:22AM ET +0.07%) and UK FTSE 100 (4,295.1 6:22AM ET +0.03%) were asleep, waiting for the US market to wake people up.

In US trading on the Monday, no particular sectors or industries were remarkable, just like Friday. The Financials (XLF +1.3%), and Utilities (XLU +1.3%) were leaders. Consumer Staples (XLP +0.6%) and Healthcare (XLV +0.6%) were winners but lagging the rest.

The leading industry group was Banks ($BKX+1.6%), while nothing stood out on the downside. Schools, printing services, and apparel were down about -2% each.

The winners among Cara 100s were Myriad Genetics, Juniper, and ABB (MYGN+4.5% JNPR+4.4% ABB+3.6%), while the losers were by Tata Motors, Teck Corp, and Votorantim (TTM-3.5% TCK-3% VCP-2.9%). Again, volume was feeble.

The trade-weighted $USD index was quiet (79.86 +0.03 +0.04%). The Euro (140.79 +0.22 +0.16%), and Pound (165.58 +0.35 +0.21%) were up a bit, but the Yen (104.11 -0.99 -0.94%) dropped sharply, and Cdn Loonie (86.42 -0.28 -0.32%) was soft against the US Dollar.

In quiet bond market trading, the US long Bond was flat ($USB 118.56 +0.03 +0.03%). The yields for 30-year (4.307 +0.04 +0.09%), 10-year (3.492 -0.14 -0.40%), and 5-year (2.528 -0.05 -0.20%) were not remarkable. Treasury bill yields dropped a tad (0.160 -0.15 -8.57%).

After days of gains, $GOLD gave back a small bit (937.80 -2.10 -0.22%).

Crude Oil was however much stronger (71.49 +2.33 +3.37%). Perhaps the driver was the struggle in Nigeria with a return of militant action near the Shell oil field.

The Euro futures were a little stronger Tuesday morning (1.4129 +0.0048 +0.34% 06:25), which may have an impact on precious metal prices.

Spot gold, palladium, platinum and silver, however, have so far not done a thing: (940.82 -0.68 -0.07% 06:38am ET); (248 0 0.00% 06:35am ET); (1191.5 -0.5 -0.04% 06:37am ET); and (14.02 +0.05 +0.36% 06:38am ET), respectively.

US equity futures were a tad stronger (8478 +20 +0.24% 06:24am ET).

Comments

[Mad Hedge F...:]

It's about to become excitiing. Now that we are solidly into a correction, I have been flooded with requests from readers to call the next bottom in the S&P 500. Well here it is. Brace yourself. Put it on a Post-it-Note on your computer. It is without a doubt and unquestionably going to be 880, 850, 830, 800, 750, 666, or 320. That last number works out to be 90% of the book value of the S&P 500, which was the low seen in the 1930s depression. Yes, that depression, not this one. You are really asking me to solve a one billion variable equation, because that is the number of direct and indirect participants in global stock markets. If the few green shoots out there start to die off, the meltdown in commercial real estate accelerates, the Fed missteps by draining liquidity too soon, or there is another unforeseen shock to the system, then you can go with the lower of these numbers. If we are distracted by the health care debate, emerging market economies continue to perk up, and this strength helps our technology stocks stay alive, then sleepy narrow trading ranges will dominate, and the higher support levels will hold. But no matter what happens, I will be able to come back to you in three months and claim that I was right.

Jun 30 01:33 PM