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Wall Street Strategies has been providing independent stock market research since 1991 to individual, retail and institutional clients through a balanced approach to investing and trading. Charles Payne, our founder and chief analyst, is routinely sought after for his stock market, political,... More
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  • CLAIMS AND SALES DATA SAVE THE SESSION By WSS Research Desk 0 comments
    Jun 13, 2013 2:43 PM

    By Carlos Guillen

    Equity markets looked dismal during pre-market hours today as Asian and European markets looked to be trading in losing territory. In particular, Japan's Nikkei stock market plummeted 6.4 percent as the Yen strengthened against the U.S. Dollar. As such, today's trading backdrop was not looking very promising, but thanks to some positive economic data points, this trading session has been able to withstand any fears stemming from Japan's sharp drop in its equity markets.

    Initial Claims data posted earlier today was certainly encouraging, as the result was better than expected, continuing to slowly decline. According to the Department of Labor, initial claims during the week ended June 8 totaled 334,000, decreasing from the 346,000 revised figure reported for the prior week and landing below the Street's estimate of 345,000. While the level of new claims has bounced around in the last couple of months, now it appears to be trending lower. The initial claims' four-week moving average was 345,250, decreasing from the prior week's average of 352,500 and breaking below the 350,000 level, which economists say is consistent with moderate labor market growth of about 150,000 net new jobs a month.

    (click to enlarge)

    Also very encouraging today was that retail sales data showed that the consumer accelerated its discretionary spending. According to the U.S. Census Bureau, retail sales during May increased year-over-year by 4.3 percent and increased month-over-month by 0.6 percent, better than the Street's consensus estimate calling for a 0.3 percent month-over-month rise. Excluding automobile related revenues, retail sales increased year-over-year by 3.4 percent and increased month-over-month by 0.3 percent, matching the Street's consensus estimate. Of the thirteen categories that make up the result, the highest gainers were led by a 1.8 percent increase in Motor Vehicle & Parts and by a 1.2 percent increased in Miscellaneous Store Retailers. Given the importance of consumer spending, as it represents 70 percent of gross domestic product (GDP), this second month of better than expected gain in retail sales will certainly bode well for second quarter GDP growth.

    (click to enlarge)

    In all, today's trading session is very encouraging as it is turning out to be much better than it looked during pre-market activity when the tanking Nikkei appeared to be threatening to sink markets around the world. However, true economic data finally made a presence this week to save the day from what would have been a fourth consecutive day of stock declines ... phew!

    Public Info Sold for Ransom
    By David Urani

    As if you needed any more reasons to think that if you're a day trader the odds are stacked against you, we got the revelation yesterday that at least one data provider, Thomson Reuters, has been giving pro high-frequency traders an edge. Of course, what they've been doing is unfortunately perfectly legal but for me it seems like something that shouldn't be.

    It all started a couple of weeks ago on May 31 with the University of Michigan Consumer Confidence survey (which is distributed by Thomson Reuters). Market watchers plainly saw that day that there was a significant spike in the market just two seconds before the 9:55 am release, at 9:54:58 am. That's led to the big revelation that Thomson Reuters has in fact been selling access to the consumer confidence index exactly two seconds early.

    As it turns out, apparently they've been selling the all-important ISM manufacturing index data two seconds early as well, for $2,000. Obviously high frequency traders already pay big money to develop high-tech computers, algorithms and high-speed data connections to be the first in line to receive information and make near-guaranteed profit on it. Clearly Thomson Reuters has exploited that by holding the data hostage for those who are willing to pay up for it just an instant early to get the jump on all the rest of us.

    Surely Thomson Reuters wouldn't be doing this if they weren't sure it was legal but for me it just shouldn't be. My point is, any information that investors may invest upon is supposed to be public information, otherwise it technically would be considered insider information. In the case of the University of Michigan Consumer Confidence index, the data is released as public information at 9:55am on the dot. But when this data is given out early to preferred buyers, you can't really call it public can you? And if it's not public, technically it seems to me like it's insider information.

    https://www.wstreet.com/user/register.asp?source=3

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