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Gary Townsend - Founding member and Chairman, GBT Capital Management, LLC, a macro long/short fund based in Chevy Chase, Maryland. Also, 2007-2013, a founding partner, CEO and Portfolio Manager of Hill-Townsend Capital LLC, a long/short equity financial sector fund. Mr. Townsend has 35 years... More
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  • U.S. Futures Rise Modestly; Asia And Europe End Mixed 0 comments
    Apr 8, 2014 9:20 AM | about stocks: AA

    This morning. Today, U.S. equity futures suggest modest gains following the past two day's distributions. In Asia, equity markets closed mixed, with weakness in Japan and strength in China. In Europe, indexes are moderately lower. The dollar is weaker. Commodities are mostly higher. Wednesday's Nikkei 225 June 2014 (NKM4) equity futures are down -1.097%.

    U.S. economic reporting focuses on the March U.S. employment report. Commentary focuses on Ukrainian developments, and interest rate, currency, and commodity price movements.

    On April 4th, the U.S. equity markets distributed and the market outlook worsened to "in correction", ending a brief "confirmed uptrend" that began on April 1st. The SPX opened April 4th at a record 1888.77, up +0.88% from the April 1st 1872.34 open.

    Yesterday, major equity indexes distributed for a 2nd consecutive session. The S&P 500 (SPX), DJ Industrials (DJI), Nasdaq, and NYSE composite closed off -1.08%, -1.02%, -1.16%, and -1.04%, respectively. The DJ Transports (TRAN) fell -1.36%.

    U.S. equity markets opened moderately lower and traded narrowly until late morning, when noises from the Ukraine (including a White House warning to Russia) depressed buying interest. NYSE volume rose +7.03% to 1.10x its 20-day moving average. The SPX, DJI, and Nasdaq are now lower in 2014.

    Other indexes closed mixed. The Russell 2000 (RTY) and Nasdaq Internet (QNET) fell -1.53% and -1.85%, respectively, while the Nasdaq Biotech (NBI) managed a +0.48% gain after reversing higher late in the session. The QNET and NBI are in correction, down -16.1% and -17.0%, respectively, from recent highs.

    The 4Q2013 quarter's earnings reports are complete, with U.S. materials reports particularly strong, followed by financials. The 1Q2014 earnings reports began on March 15th, though only 20 of 500 SPX companies have now reported. JPMorgan (NYSE:JPM) initiates financial companies' 1Q2014 earnings season with its report this Friday.

    Trading desks report mixed equity markets overnight, but a fragile sentiment as views on risk assets deteriorate sharply since April 4th. A near-term bounce is expected, as the SPX has now fallen near the bottom of its recent 1840-1880 trading range. Focus is on earnings, as Alcoa (NYSE:AA) reports after the close.

    Price earnings multiples remain elevated. With SPX equities trading at a 16.8x 2013 earnings multiple, attention focuses on 2014 earnings and valuations (16.8x times survey $117.30 2014 SPX operating earnings suggests a 1,964.74 SPX level next year, a +6.49% rise).

    Technicals worsened as the major indexes closed below their 5-, 10-, and 20-day moving averages. The Nasdaq closed below its 5-, 10-, 20-, 50-, and 100-day moving averages. Led by consumer services and financials, all SPX market segments closed at least -0.06% lower. Market breadth was negative, and up volume lagged down volume. Volatility rose moderately. Treasury bond markets strengthened. The U.S. Treasury 10-year bond yield fell -2.09 bps to 2.6998%, compared to 2.7207% at the prior close.

    This morning, 10-year U.S. Treasury yields are up +1.18 bps at 2.7116%, compared to the prior close. Spanish and Italian 10-year debt yields are near their lowest levels since 2005, at 3.22% and 3.20%, respectively, compared to 3.15% and 3.17% the prior day. The U.S. dollar is modestly stronger compared to the euro and Japanese yen.

    U.S. options markets were unchanged at bearish to bullish, compared to bearish to bullish the prior day. The CBOE SKEW fell -2.12% to 123.92, compared to 126.61 the prior day, above a neutral range (115-120), but below 130, a level that correlates well with short-term market tops.

    In pre-market futures trading, June SPX equity futures (SPM4) price near the middle of a 1833-1844 trading range. After a fair value adjustment of -0.06 points, the SPM4 future prices at 1852.75, up +0.81 points. The SPX opens -1.03% below its 20-day moving average, but +0.32%, +1.05%, and +5.05% above its respective 20-, 50-, 100-, and 200-day moving averages. Initial resistance is 1858.89. Initial support is 1836.33, then 1827.63.

    In Asia, equity markets closed mixed. China reopened after yesterday's holiday. On the day, the Nikkei 225 (NYSEARCA:NKY) fell -1.36% as new consumer taxes were implemented and moved into correction. The Hang Sang index (HSI) rose +0.98%. The Shanghai SE composite (SHCOMP) index rose +1.92%. Today's volumes are unavailable.

    Commentary focused on currency and commodity price developments. This week, the NKY is down -3.03%, while the HSI and SHCOMP are up +0.39% and +1.92%, respectively. Last week, the NKY, HSI, and SHCOMP closed up +2.50%, +2.01%, and +0.84%, respectively. In April, the NKY is down -1.49%, while the HSI and SHCOMP are up +2.01% and +3.20%, respectively, compared to March, when the NKY, HSI, and SHCOMP lost -0.09%, -3.00%, and -1.12%, respectively.

    In 2014, the NKY, HSI, and SHCOMP are down -10.3%, -3.04%, and -0.84%, respectively. In 2013, the NKY rose +56.7%. The HSI closed up +2.87%. The SHCOMP closed down -6.75%.

    In China, short-term interbank lending rates remained quite volatile and rose +0.60 bps to 3.59%, compared to 2.99% on Friday, up from a 2.26% low on March 11th, but down from the February 7th 5.41% recent high.

    Regional relative strength indexes (RSI) show Tokyo, Hong Kong, and Shanghai, in neutral ranges. The NKY RSI fell to 46.05, compared to 50.98 the prior day, up from an oversold 27.92 on February 4th. The HSI RSI rose to 59.79, compared to 55.46 the prior day. The SHCOMP's RSI rose to 61.05, compared to 52.96 the prior session. On June 27, 2013, the index's RSI fell to a low of 15.27, which was also last year's low index close.

    In Japan, the NKY closed at 14,606.88, compared to 14,808.85 the prior day, -10.3% below its recent year-end 16,291.31 high and -62.5% below its late-1989 38,915.87 high close. The index gapped lower to open at 14,720, and fell to 14,620 support by mid-morning. The index rallied to the 14,740.10 intraday high in early afternoon, but quickly slipped back to support by mid-afternoon, then slipped through support late in the session to a late 14,605.31 intraday low. The index closed -0.60%, -0.90%, and +-3.35% below its respective 20-, 50-, and 100-day moving averages, but +0.19% above its 200-day moving averages. Most market segments closed lower. Leaders were consumer services, which rose +0.17%,and basic materials and technology, which fell at least -0.46%. Financials lost -1.75%. Laggards were oil and gas, health care, and telecommunications, which fell at least -2.03%.

    In China, the HSI closed at 22,596.97, compared to 22,377.15 at the prior close. At the open, the index traded briefly lower with a 22,329.99 intraday low, but immediately reversed higher and rose to 22,600 by late morning. The index traded narrowly to the close with a mid-afternoon 22,625.21 intraday high. Most market segments closed higher. Leaders were utilities, technology, and telecommunications, which rose at least +1.22%. Financials rose +1.18%. Laggards were basic materials, which rose +0.66%, and industrials and consumer services, which fell at least -0.41%. The index closed -5.49% below its recent December 3rd 23,910.47 high, but +24.3% above its 18,185.59 June 4, 2012 low.

    In Shanghai, the SHCOMP closed at 2,098.28, compared to 2,058.83 at the prior close, +7.60% above the 1,950.01 June 27th close, last year's low. The index opened lower, set its 2,053.00 intraday low, then reversed higher and rallied to a mid-afternoon 2,102.45 intraday high. All market segments closed at least +1.24% higher. Leaders were financials, consumer goods, and health care, which rose at least +1.921%. Laggards were utilities, oil and gas, and technology.

    In Europe, major equity indexes are lower and trade near their intraday lows, with greater weakness in Madrid and Milan. The Euro Stoxx50, FTSE 100, CAC 40, and DAX down -0.84%, -0.86%, -0.78%, and -0.72%, respectively. The Spanish IBEX 35 is down -1.65%, and the Italian FTSE MIB down -1.40%. Commentary focuses on the Ukrainian tensions and commodity and currency pricing developments.

    Economic reporting is light.

    European bourses have recently outperformed U.S. equity indexes. Intraday Euro Stoxx50 relative strength (RSI) is 54.71, compared to 58.93 at the prior close, in a neutral (30-70) range, but better than its recent February 5th 33.57 low, which coincided with its 2014 low. The indexes lowest recent RSI level was 25.77 on June 24th, which marked the 2013 2,494.54 closing low.

    Today, the Euro Stoxx50 trades at 3,098.00, 3,198.18, -2.18% below its 3,230.33 April 4th post-2008 high close, and -39.8% below its 5,249.55 March 31, 2000, all-time closing high. From its prior day close, the index traded narrowly high at the open, set a 3,192.42 intraday high, then reversed lower by mid-morning and fell to an early afternoon 3,146.90 intraday low. The index improved to 3,163.72 by mid-afternoon. Most market segments are lower. Leaders are health care and oil and gas, which are up at least +0.03%, and consumer goods, which is down -0.01%. Laggards are industrials, financials, and consumer services, which are down at least -1.22%.

    This week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX are down -2.18%, -1.95%, -1.88%, and -2.66%, respectively. Last week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX closed up +1.83%, +1.21%, +1.66%, and +1.13%, respectively. In April, the AC 40 is up +0.20%, while the Euro Stoxx50, FTSE 100, and DAX are down -0.06%, -0.51%, and -1.23%, respectively. In March, Euro Stoxx50 closed up +0.39%, while the FTSE 100, CAC 40, and DAX closed down -3.10%, -0.38%, and -1.40%, respectively.

    In 2014, the indexes are mixed. The Euro Stoxx50, CAC 40, and DAX are up +1.64% and +2.43%, respectively. The FTSE 100 and DAX are down -2.73% and -1.20%, respectively. In 2013, the indexes closed up +18.0%, +14.4%, +18.0%, and +25.5%, respectively.

    1Q2014 SPX Earnings. Of 20 (of 500) reporting companies, 11 or 55.0% surprised positively on earnings, with an average +0.66% surprise average. Of reporting companies, 10 or 50.0% reported sales or revenues above estimates. The average sales/revenue surprise is -0.25%. Consumer discretionary leads with respective +11.3% and +0.86% earnings and revenue surprises. Industrials lag with respective -13.4% and -1.08% revenues surprises.

    Valuation. The SPX trades at 16.8x estimated 2013 earnings ($110.15), 15.7x estimated 2014 earnings ($117.30), 14.1x estimated 2015 earnings ($130.75), and 12.7x estimated 2016 earnings ($145.23). The 10-year average median price/earnings multiple is 15.9x. Analysts expect 2013, 2014, 2015, and 2016 earnings to grow +6.52%, +6.49%, +11.5%, and 11.1%, respectively.

    The BKX trades at 13.7x 2013 adjusted EPS ($5.16), 12.8x estimated 2014 earnings ($5.50), 11.6x estimated 2015 earnings ($6.10), and 10.3x 2016 earnings ($6.86). Analysts expect 2013, 2014, 2015, 2016 EPS will grow +19.4%, +6.51%, +11.2%, and +12.5%, respectively.

    Composite, index, and equity options. Options markets were unchanged at bearish to bullish, compared to bearish to bullish the prior session. Composite options are neutral, index options are bullish, and equity options are bearish. The composite put/call ratio is 0.99, compared to 0.95 the prior day, and worse than 5- and 10-period moving averages of 0.89 and 0.90, respectively. The index put/call ratio is 0.90 compared to 0.81 the prior day, and better than its 5- and 10-period moving averages of 0.99 and 1.00, respectively. The equity put/call ratio closed the day at 1.02, compared to 1.02 the prior day, and worse than its 5- and 10-period moving averages of 0.85 and 0.86, respectively.

    NYSE Volume, Breadth Indicators. Volume rose +7.03% to 835.93 million shares, compared to 781.05 million shares the prior day, 1.10x the 758.52 million share 20-day moving average. Market breadth was negative, and up volume lagged down volume. Advancing stocks lagged by -1,407 (compared to -948 the prior day), or 0.37:1. Up volume was 0.25:1 down volume.

    Market Outlook and Distribution Day Count. On April 4th, the U.S. equity markets distributed and the market outlook worsened to "in correction", ending a brief "confirmed uptrend" that began on April 1st. The SPX opened April 4th at a record 1888.77, up +0.88% from the April 1st 1872.34 open.

    Libor, LOIS, Currencies, Treasuries, Commodities:

    · USD LIBOR is 0.08850%, compared to 0.08650% the prior day. USD 3-month LIBOR is 0.22730%, down from 0.22935% the prior day, and compares to the January 4, 2013, recent peak of 0.58250%.

    · The US Libor-OIS (LOIS) spread is 14.530 bps, compared to 14.735 bps the prior day, and compares to the recent June 12, 2012, 46.785 bps high. Euribor-OIS is 13.800 bps, up from 13.000 bps the prior day, and down from the December 27, 2011, high of 98.800 bps. Moves in the LOIS indicate changes in intra-bank lending risk premiums.

    · The 3-month Euro basis swap is -1.974 bps, compared to -1.380 bps the prior day, up from a trough of -147.00 bps on December 14, 2011, but far better than a normal -10 bps and -40 bps range.

    · German 10-year debt yields are 1.55%, compared to 1.54% the prior day. Japanese 10-year debt yields are 0.62%, compared to 0.62% the prior day.

    · Spanish and Italian 10-year debt yields are at their best levels since 2005. Spanish 10-year debt yields are 3.19%, compared to 3.18% the prior day. Italian 10-year debt yields are at 3.20%, compared to 3.19% the prior day.

    · U.S. Treasury yields are slightly lower, with 2- and 10-year maturities yielding 0.403% and 2.703%, respectively, compared to 0.395% and 2.700% Monday. The yield curve narrowed -0.530 bps, with the 2- to 10-year spread at +2.300%, compared to 2.305% the prior day. In the past year, the 2- and 10-year spread varied from a low of +1.429% on May 1, 2013, to a high of +2.648% on December 31, 2013.

    · The U.S. dollar is weaker compared to the euro, Japanese yen, and British pound. The dollar trades at US$79.985, compared to a US$79.957 intraday low and US$80.232 the prior day, and mixed compared to its $80.207 50-day, US$80.393 100-day, and US$80.818 200-day averages. The euro trades at US$1.3765, compared to a US$1.3737 intraday high and US$1.3742 the prior day. The euro trades mixed compared to its US$1.3739 50-day and US$1.3694 100-day averages, and compares to a multi-year low of US$1.1877 on June 7, 2010. In Japan, the dollar trades at ¥102.43, compared to ¥103.10 the prior day. The yen trades worse than its 50-day moving average ¥102.38, but better than its January 1st 105.31 closing low, its weakest prior multi-year closing low.

    · Citigroup Economic Surprise Index worsened to -45.90, compared to -43.80 the prior day, at its worst level since May 2012 and continuing its string of consecutive negative readings since February 18th. The index is worse compared to its respective -39.68 5-day and -35.45 10-day moving averages. Last June 10th, the index fell to a then 52-week low of -33.26. The index improved and turned positive on July 30th and rose to 53.30 on October 1st, but subsequently fell on dollar weakness to -2.10 on October 31st. It subsequently strengthened to a +72.70 high on January 15th, but then subsequently trended lower and turned negative on February 19th and fell to a -43.80 124-week low on April 7th . After a lag, the CESIUSD correlates with EPS revisions.

    · Commodities prices are mostly higher, with higher energy, higher precious metals, higher aluminum and copper, and mixed agriculture prices.

    Volatility, Skew:

    · The CBOE SPX Volatility Index (VIX) rose +11.5% to 15.57, compared to 13.96 at the prior close. The VIX is +5.86% above the 14.71 20-day moving average. Its 30-day high is 18.22. Its 30-day low is 12.60. The index's all-time closing low is 9.31 on December 22, 1993. The long-term average is 20.14.

    · The Euro Stoxx 50 volatility index (V2X) is 18.12, up +3.27% compared to 17.54 at the prior day's close. The V2X index trades -2.83% below its 18.64 20-day moving average, -25.6% below the 24.35 30-day high, and +16.9% above the 15.50 30-day low.

    · The Hang Seng volatility index (VHSI) closed at 14.49, down -4.29% compared to 15.14 at the prior close. The VHSI index trades -14.4% below its 16.92 20-day moving average. Its lowest historical close was 11.72, on June 30, 2005.

    · CBOE SKEW (SKEW) fell -2.12% to 123.92, compared to 126.61 the prior session, above a neutral reading (115-120), but below 130, a level that correlates well with short-term market tops. The recent record high was 143.20 on December 20th. Its recent low was 112.47 on May 25, 2013. Spikes in excess of 130 correlate well with short-term market tops, though not in October or November. The index rarely falls below 110, last on July 31, 2009. The index correlates with market tail risks, the cost of buying out-of-the-money, long-dated options, i.e., options not affected by expirations. A rise suggests that investors are buying more puts than calls, a bearish signal.

    U.S. Economic Reporting and News:
     

    • February consumer credit rose to $16.5 billion, compared to $14.0 billion survey and $13.797 billion revised prior.
    • March NFIB small business optimism improved to 93.4, compared to 92.5 survey and 91.4 prior.


    Overseas Economic Reporting and News:
     

    • Australia - March NAB business confidence was 4,compared to 7 prior. NAB business conditions rose to 1, compared to 0 prior.
    • Japan - March YoY bankruptcies fell -12.4%, compared to -14.6% prior.
    • France - March Bank of France business sentiment was 99, compared to 98 prior. February trade balance was -3.368 billion, compared to -5.0 billion survey and -5.6 billion revised prior.
    • United Kingdom - February MoM industrial production rose +0.9%, compared to +0.3% survey and +0.0% revised prior. February MoM manufacturing production rose +1.0%, compared to +0.3% survey and +0.3% revised prior.


    Company Ratings/News:
     

    • None.


    Monday's Trade. On greater and above average NYSE volume, U.S. equity indexes distributed again. On the day, the SPX, DJI, Nasdaq, and NYSE composite fell -1.08%, -1.02%, -1.16%, and -1.04%, respectively. On the week, the Nasdaq closed lower. In 2014, the SPX and NYSE composite are higher.

    Other indexes closed mixed. The Russell 2000 (RTY) fell -1.53% and is -6.03% below its March 4th record close. The Nasdaq Internet Index (QNET) fell -1.85%, in correction and -16.1% below its March 6th closing high. The Nasdaq Biotech Index rose +0.48%, in correction and down -17.0% from its recent February 25th record high.

    On April 4th, the U.S. equity markets distributed and the market outlook worsened to "in correction", ending a brief "confirmed uptrend" that began on April 1st. The SPX opened April 4th at a record 1888.77, up +0.88% from the April 1st 1872.34 open.

    Market breadth was negative, with gainers 0.37x losing stocks. All SPX market segments closed at least -0.06% lower. Leaders were telecommunications, consumer goods, and utilities. Laggards were oil and gas, financials, and consumer services, which fell at least -1.45%.

    NYSE volume rose +7.03% to 835.93 million shares, compared to 781.05 million shares the prior day, 1.10x the 758.52 million share 20-day moving average volume. On the day, bond markets strengthened markedly. The U.S. 10-year yield opened at 2.7189%, and moved narrowly to a mid-session 2.7334% intraday high, but then fell sharply in early-afternoon, when the yield fell to the day's 2.6808% intraday low. The yield closed at 2.6998%, down -2.09 bps compared to the 2.7207% prior close.

    From its prior day 1865.09 SPX close, June 2014 SPX futures (SPM4) suggested a moderately lower open. The SPX index fell to 1855 in early trading, recovered nearly to breakeven by mid-morning, then traded back to initial support at 1855. The index weakened moving into the afternoon session and trended lower to late afternoon to the session's 1841.48 intraday low. A late rally pulled the index back to 1853, but the rally faltered and the index weakened into the close. The SPX ended at 1845.04, -2.43% below its April 2nd record close. The index closed +71.7% above the 1074.77 October 4, 2011, intraday low, the bottom of the most recent correction.

    The DJ Transportation index (TRAN) fell -1.08%, compared to DJI's -1.02% loss. From its prior 7,570.76 close, the TRAN briefly traded higher, set a 7,580.63 intraday high, but reversed lower after 10:00, then reversed lower and trended lower to a late afternoon 7,444.24 intraday low. Volume rose +11.4% to 12.514 million shares, compared to 11.233 million shares the prior session, and 0.93x the 15-day moving average volume. The TRAN closed -0.97% below its 20-day moving average, but +1.04%, +1.91%, and +7.57% above its respective 50-, 100-, and 200-day moving averages.

    Market volatility rose +11.5%, as the CBOE SPX volatility index (VIX) closed at 15.57, compared to 13.96 at the prior close. The VIX opened just below 15.0, fell to an early 14.57 intraday low, then trended higher to a late afternoon 16.01 intraday high. The index fell back to 15.10 in the final hour, but rose through the session's final 30 minutes. The VIX's all-time closing low was 9.31, on December 22, 1993. Its record high was 89.53 in December 2008. Its lifetime average is 20.01.

    The market's technical factors worsened. All major indexes closed below their respective 5-, 10-, and 20-day moving averages. The Nasdaq also closed below its 50- and 100-day moving averages. SPX relative strength (RSI) fell to 44.52, compared to 51.35 the prior day, in a neutral range, and better than an oversold 31.24 on February 3rd. The RSI is also down from an overbought 71.26 on December 31st, when the SPX closed an earlier record high, but above earlier oversold levels of 35.14 on August 27th and 39.19 on October 9th. The CBOE put/call SKEW fell -2.12%, compared to 123.92, compared to 126.61 the prior session, above a neutral 115-120 range, but below 130, a level that correlates well with short-term market tops.

    Last week, the SPX, DJI, and NYSE composite closed up +0.40%, +0.55%, and +0.79%, respectively, while the Nasdaq closed down -0.67%. The prior week, the DJI rose +0.12%, while the SPX, Nasdaq, and NYSE composite closed down -0.48%, -2.83%, and -1.73%, respectively. In April, the SPX, DJI, Nasdaq, and NYSE composite are down -0.39%, -0.27%, -1.70%, and -0.10%, respectively. In March, the DJI and NYSE composite are up +0.01% and +0.09%, respectively, while the SPX and Nasdaq are down -0.10% and -3.54%, respectively.

    In 2014, the SPX, DJI, and Nasdaq are down -0.18%, -2.00%, and -2.32%, while the NYSE composite remains +0.07% higher. In 2013, the SPX, DJI, Nasdaq, and NYSE composite closed up +29.6%, +26.5%, +38.2%, +23.2%, respectively. All closed at least +5.91% higher in 2012.

    KBW Bank Index (BKX). On greater and above average volume, the BKX fell -1.56% to 70.57, compared to 71.69 at the prior day's close, its 16th consecutive close above 70.00, but -2.43% below its 72.91 March 20th post-2008 closing high. The index opened modestly lower, but fell rapidly to 71.0 in early session, then trended lower to a mid-afternoon 70.67 intraday low. The index improved modestly in the final hour. Volume rose +22.6% to 64.661 million shares, compared to 52.748 million shares the prior day, and 1.26x the 51.348 million share 15-day moving average.

    Large cap banks underperformed the regional banks, as the KBW regional banking index (KRX) fell -0.82%.

    Last week, the BKX closed up +0.35%, compared to a decline of -1.73% the prior week. In April, the BKX is down -2.38%, compared to March, when the BKX closed up +4.94%. In 2014, the BKX is up +1.89%, compared to the SPX's -0.18% loss. In 2013, the BKX rose +35.1%, better than the SPX's +29.6% rise.

    The BKX is now +19.2% better than the June 24th 59.19 close, its worst since May 13, 2013. The index crossed above 50 on December 17, 2012, 60 on May 15, 2013, and 70 on January 8, 2014, but then dropped back below 70 on January 24th, which persisted until March 6th. The BKX closed +116.7% above the 32.56 intraday low on October 4, 2011, the bottom of that year's correction. Large-cap bank stocks have outperformed the broader market's rebound, with the SPX up +71.7% in the same period.

    The BKX index closed -41.7% below its February 20, 2007, record 121.06 high. The BKX is up +279.0% from its 18.62 March 6, 2009, closing low.

    Technical indicators worsened, as the BKX surrendered its 20-day moving average. The index closed -1.37% below its 20-day moving average, but +1.34%, +2.31%, and +6.12% above its respective 50-, 100-, and 200-day moving averages. The 20-day moving average fell -4 bps to 71.55. The 69.25 50-day moving average rose +6 bps. Its 100-day moving average rose +8 bps to 69.25, and the 200-day moving average rose +6 bps to 65.82. The 20-day closed (by +1.91 points) above the 50-day, but the gap narrowed -9 bps. The 50-day moving average closed (by +3.14 points) above the 200-day moving average, and the gap narrowed -1 bp. The 100-day moving average closed (by +2.48 points) above the 200-day moving average, and the gap was unchanged.

    The directional movement indicator worsened to -4.935, compared to +5.773, its first negative reading since February 27th. Relative strength fell to 46.03, compared to 53.87 the prior day, in a neutral range, up from the recent 32.95 low on February 3rd, but down from an overbought 75.56 and 71.88 on January 9th and 10th, respectively. The recent low RSI level 31.08 on November 14, 2012, which is also the date of the BKX's 2012 closing low. Next resistance is 71.39; next support is 70.04.

    Themes: SPX, DJI, RTY, TRAN, CCMP, NYA, VIX, SKEW, NKY, EURUSD, USGG10YR, HSI, SHCOMP, SX5E, CAC, DAX, FTSE, JPY, GBP, EUR Stocks: AA
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