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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 Flat After May Retail Sales Disappoint; Asia Eases, Europe Gives Up Early Gains 0 comments
    Jun 12, 2014 8:53 AM

    This morning. U.S. equity futures are modestly weaker following release of U.S. May retail sales reports at 8:30. The market outlook is "confirmed uptrend". In Asia, equity markets closed lower. European bourses have given up early gains and are modestly mixed. The euro is slightly weaker. U.S. Treasury 10-year yields are lower at 2.6349%. The worldwide sovereign bond market rally may be over. Spanish and Italian 10-year yields are near multi-year lows, but the Spanish yield has rebounded to a level modestly above the corresponding U.S. yield. Commodities are mostly higher, as energy prices rise on Iraqi security concerns. Friday's Nikkei 225 June 2014 (NKM4) equity futures are moderately lower.

    Wednesday, on excruciatingly light volume, major U.S. indexes fell to moderate early losses, then traded narrowly with somewhat greater mid-afternoon weakness. All major indexes closed lower. The S&P 500 index (SPX), DJ Industrial index (DJI), Nasdaq, and NYSE composite fell -0.35%, -0.60%, -0.14%, and -0.38%, respectively. This week, all are at least -0.09% lower, but in June, indexes are up least +0.08%. In 2014, the SPX, DJI, Nasdaq, and NYSE composite are +5.86%, +1.50%, +6.26%, and +4.25% higher in 2014, respectively. NYSE volume fell -4.59% to 0.84x its 20-day moving average.

    Other notable indexes also closed mixed. The DJ Transports (TRAN) fell -0.76%. The Russell 2000 (RTY) fell -0.51% to close -3.47% below early March highs. The Nasdaq Internet (QNET) index rose +0.79%, and the Nasdaq Biotech (NBI) index fell -0.09%. The QNET remains in correction, down -10.6%, while the NBI closed -8.91% from its recent high.

    Trading desks report quiet overnight markets with little change to the current investment narrative. In Japan, equities declined moderately, though on little real news, and China declined modestly on little new news. Europe opened higher, but has given up most of the early gains. Regarding yesterday's slow trade, markets declined, but with behavior more indicative of consolidation of recent gains than signal of a market top. The economic calendar is nearly empty until the Fed's June 18th meeting, then flash June PMIs on the 23rd, and the start of 2Q2014 earnings. Sentiment is cautious, even as equity P/E multiples rise and volatility falls to multi-year lows.

    Today's economic reporting focuses on May U.S. retail sales and the latest weeks' initial and continuing jobless claims. Relative strength indicators have fallen back within a neutral range.

    The 1Q2014 earnings reports began on March 15th, and 499 of 500 SPX companies have now reported, with respective +5.91% EPS and +0.20% revenue surprises. Forward estimates are moving up. Compared to February 28th, the May-end 2014 EPS estimate rose 0.39% to $118.20, from $117.74. Respective estimates for 2015 and 2016 are now $131.39 and $145.75, compared to $130.81 and $144.98 at February-end, respective increases of +0.44% and +0.54%.

    Price earnings multiples remain elevated. With SPX equities trading at a 17.7x (compared to 17.7x the prior day) 2013 earnings multiple, attention focuses on 2014 earnings and valuations (17.7x times survey $118.21 2014 SPX operating earnings suggests a 2093.32 SPX level in the next year, a +7.31% rise from yesterday's close).

    Technicals were little changed. Led by utilities and industrials, most SPX market segments declined. Market breadth was negative, and up volume lagged down volume. Volatility rose, but remains near the lower end of historical ranges. Treasury bond markets weakened. On the day, the U.S. Treasury 10-year bond yield fell -0.45 bps to 2.6394%, compared to 2.6439% at the prior close.

    This morning, 10-year U.S. Treasury yields are up +1.00 bps at 2.6494%, compared to 2.6394% at the prior close. World sovereign bond markets are also weaker. Spanish and Italian 10-year debt yields are 2.66% and +2.80%, respectively, compared to 2.64% and +2.79% the prior day.

    U.S. options markets were unchanged at neutral to bullish, compared to neutral to bullish the prior day. The CBOE SKEW rose, and remains above a neutral range, though below 130.

    In pre-market futures trading, June SPX equity futures (SPM4) price near the bottom of a 1942-1948 trading range. After a fair value adjustment of -1.01 points, the SPM4 future prices at 1943.00, up +0.26 points. The SPX opens +1.63% and +3.02% above its respective 20- and 50-day moving averages, and +4.47% and +7.57% above its 200-day moving averages. Initial resistance is 1948.81. Initial support is 1939.52, then 1935.16.

    "Confirmed Uptrend" Market Outlook and Distribution Day Count. On May 27th, based on the Nasdaq follow-through and the SPX record close, the market outlook improved to "confirmed uptrend", ending a period of market "in correction" that began on April 4th. The SPX closed June 9th at a record 1951.27, +7.47% above the 1815.69 close on April 11th, the low close. On March 5, 2014, the Nasdaq peaked at a multi-year 4,357.97 high (compared to its 4,572.83 March 31, 2000 record close), then fell -8.22% to 3,999.73 before recovering +8.46% to the June 10th 4,338.00 close. There have been no distribution days since May 27th.

    In Asia, equity markets closed lower. The Nikkei 225 (NYSEARCA:NKY) fell -0.64%. The Hang Seng (HSI) Index fell -0.35%, and the Shanghai SE (SHCOMP) declined -0.16%. The NKY, HSI, and SHCOMP 50-day moving averages are also below their respective 200-day moving averages. Today's volumes are unavailable.

    Asian economic commentary focused on expectations regarding tomorrow's Chinese industrial production reports.

    This week, the NKY is down -0.69%, the HSI is up +0.98%, and the SHCOMP is up +1.07%, respectively. Last week, the NKY closed up +3.04%, while the HSI lost -0.57% and the SHCOMP -0.45%. In June, the NKY is up +2.33%, the HSI is up +0.40%, and the SHCOMP is up +0.61%. In May, the NKY closed up +2.29%, the HSI rose +4.28%, and the SHCOMP rose +0.63%.

    In 2014, the NKY is down -8.09%, while the HSI is down -0.56%. The SHCOMP is down -3.04%. 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 remain volatile, as the SHIBO 7-day rate rose +1 bp to 3.16%, compared to 3.15% the prior day, 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 ended at 60.15, compared to 64.79 the prior day, up from an oversold 27.92 on February 4th, the most recent prior yearly low. The HSI RSI rose to 59.02, compared to 64.29 the prior day. The SHCOMP's RSI rose to 54.61, compared to 55.93 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 14,973.53, compared to 15,069.48 the prior day, -8.09% below its recent year-end 16,291.31 high and -61.5% below its late-1989 38,915.87 high close. The index gapped lower to open at 14,940, fell to an early 14,862.08 intraday low, then improved to an early afternoon 14,992.96 intraday high before trading narrowly to the close. Most market segments closed higher. Leaders were telecommunications, utilities, and oil and gas, which rose at least +0.08%. Financials fell -0.68%. Laggards were technology, basic materials, and consumer services, which fell at least -0.78%.

    In China, the HSI fell to an early 23,065.50 intraday low, then improved to 23,150 by mid-morning and to an early afternoon 23,237.76 intraday high. The index traded narrowly above 23,150 thorough the afternoon. Most market segments closed lower. Leaders were telecommunications, oil and gas, and consumer services, which rose at least +0.27%. Laggards were basic materials, technology, and financials, which fell -0.23%. The index closed -3.08% below its recent December 3rd 23,910.47 high, but +27.4% above its 18,185.59 June 4, 2012 low.

    In Shanghai, the SHCOMP closed at 2,051.71, compared to 2,054.95 at the prior close, +5.22% above the 1,950.01 June 27, 2013 close, last year's low. The index opened lower and fell to a late morning 2,0456.00 intraday low before rallying to an early afternoon 2,057.04 intraday high. The index quickly reversed lower again and eased to the close. Most market segments closed lower. Leaders were technology and industrials, which rose at least +0.19%, and consumer goods, which fell -0.05%. Financials fell -0.21%. Laggards were telecommunications, utilities, and consumer services, which fell at least -0.41%.

    In Europe, equities opened lower but reversed higher to mid-morning highs before easing again to near breakeven. The Euro Stoxx 50, FTSE 100, CAC 40, and DAX are up +0.03%, +0.15%, +0.16%, and +0.05%, respectively. The Spanish IBEX 35 is up +0.23%. The Italian FTSE MIB is down -0.16%.

    Economic reporting is light. The euro is weaker compared to the dollar.

    European bourses have recently outperformed U.S. equity indexes. Intraday Euro Stoxx50 relative strength (RSI) is 64.77, compared to 64.41 at the prior close, returning to the top of a neutral (30-70) range, 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.

    The Euro Stoxx50 trades -37.3% below its 5,249.55 March 31, 2000, all-time closing high. From its prior day 3,313.80 close, the index trended lower through the morning session to an early afternoon 3,285.15 intraday low. The index currently trades at 3,292.28. Most market segments are higher. Leaders are telecommunications, oil and gas, and health care, which are up at least +0.22%. Laggards are industrials, financials, and utilities, which are down at least -0.22%.

    This week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX are down -0.09%, -0.12%, -0.36%, and -0.29%, respectively. Last week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX closed up +1.53%, +0.20%, +1.36%, and +0.44%, respectively. In June, the Euro Stoxx50, FTSE 100, CAC 40, and DAX are up +1.44%, +0.08%, +1.00%, and +0.15%, respectively. In May, the Euro Stoxx50, FTSE 100, CAC 40, and DAX closed up +1.44%, +0.95%, +0.72%, +3.54%, respectively.

    In 2014, the indexes are higher. The Euro Stoxx50, FTSE 100, CAC 40, and DAX are up +5.86%, +1.50%, +6.26%, and +4.25%, respectively. In 2013, the indexes closed up +18.0%, +14.4%, +18.0%, and +25.5%, respectively.

    1Q2014 SPX Earnings. Of 499 (of 500) reporting companies, 370 or 74.5% surprised positively on earnings, with an average +5.91% surprise average. Of reporting companies, 263 or 53.0% reported sales or revenues above estimates. The average sales/revenue surprise is +0.20%. Energy leads with respective +10.0% and -1.01% earnings and revenue surprises. Financials have a respective +5.67% and +0.26% earnings and revenue surprises. Consumer staples lags with respective +0.34% and -0.66% earnings and revenue surprises.

    Valuation. The SPX trades at 17.7x estimated 2013 earnings ($110.15), 16.5x estimated 2014 earnings ($118.20), 14.8x estimated 2015 earnings ($131.39), and 13.4x estimated 2016 earnings ($145.76). The 10-year average median price/earnings multiple is 15.9x. Analysts expect 2014, 2015, and 2016 earnings to grow +7.31%, +11.2%, and 10.9%, respectively.

    The KBW Bank Index (BKX) trades at 13.9x 2013 adjusted EPS ($5.16), 13.4x estimated 2014 earnings ($5.34), 12.0x estimated 2015 earnings ($5.99), and 10.8x 2016 earnings ($6.67). Analysts expect 2014, 2015, 2016 EPS will grow +3.56%, +12.1%, and +11.4%, respectively.

    Composite, index, and equity options. Options markets were unchanged at neutral to bullish, compared to neutral to bullish the prior session. Composite options are bullish, index options are bullish, and equity options are neutral. The composite put/call ratio is 0.74, compared to 0.70 the prior day, and better than 5- and 10-period moving averages of 0.79 and 0.79, respectively. The index put/call ratio is 0.81, compared to 0.78 the prior day, and better than its 5- and 10-period moving averages of 0.87 and 0.94, respectively. The equity put/call ratio closed the day at 0.70, compared to 0.66 the prior day, and better than its 5- and 10-period moving averages of 0.74 and 0.74, respectively.

    NYSE Volume, Breadth Indicators. Volume fell -4.59% to 531.56 million shares, compared to 557.12 million shares the prior day, 0.84x the 630.80 million share 20-day moving average. Market breadth was negative, and up volume lagged down volume. Advancing stocks lagged by -849 (compared to -458 the prior day) or 0.56:1. Up volume was 0.56:1 down volume.

    Libor, LOIS, Currencies, Treasuries, Commodities:

    · USD LIBOR is 0.09190%, compared to 0.08880% the prior day. USD 3-month LIBOR is 0.23060%, down from 0.22980% the prior day, and compares to the January 4, 2013, recent peak of 0.58250%.

    · The US LIBOR-OIS (LOIS) spread is 13.660 bps, compared to 13.480 bps the prior day, and compares to the recent June 12, 2012, 46.785 bps high. Euribor-OIS is 20.000 bps, compared to 19.200 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 -11.847 bps, compared to -9.615 bps the prior day, up from a trough of -147.00 bps on December 14, 2011, and within a normal -10 bps and -40 bps range.

    · German 10-year debt yields are 1.40%, compared to 1.40% the prior day.

    · Japanese 10-year debt yields are 0.60%, compared to 0.60% the prior day.

    · Spanish and Italian 10-year debt yields fell to new multi-year lows. Spanish 10-year debt yields are 2.66%, compared to 2.64% the prior day, modestly above the U.S. 10-year yield. Italian 10-year debt yields are at 2.80%, compared to 2.79% the prior day and their June 9th 2.704% recent low. Spanish and Italian 10-year debt years peaked at 7.62% and 7.26%, respectively, in July 2012 and November 2011.

    · U.S. Treasury yields are modestly higher, with 2- and 10-year maturities yielding 0.439% and 2.649%, respectively, compared to 0.431% and 2.639% Wednesday. The yield curve widened +0.190 bps, with the 2- to 10-year spread at +2.210%, compared to 2.209% 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 mixed, stronger compared to the euro, unchanged compared to the Japanese yen, but weaker compared to the British pound. The dollar trades at US$80.780, compared to US$80.672 intraday low and US$80.788 the prior day, and better compared to its $80.017 50-day, US$80.121 100-day, and US$80.319 200-day averages. The euro trades at US$1.3526, compared to a US$1.3512 intraday low and US$1.3532 the prior day. The euro trades worse compared to its US$1.3740 50-day and US$1.3737 100-day averages, and compares to a multi-year low of US$1.1877 on June 7, 2010. In Japan, the dollar trades at ¥102.07, compared to ¥102.07 the prior day. The yen trades worse than its 50-day moving average ¥102.11, but better than its January 1st 105.31 closing low, its weakest prior multi-year closing low.

    · Citigroup Economic Surprise Index improved to -13.00, compared to -13.20 the prior day, its 8th consecutive negative reading. The index is mixed compared to its respective -13.28 5-day and -9.31 10-day moving averages. From a +72.70 high on January 15th, the index subsequently trended lower and turned negative on February 19th and fell to a -45.90 124-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, mixed aluminum and copper, and mostly higher agriculture prices.

    Volatility, Skew:

    · The CBOE SPX Volatility Index (VIX) rose +5.55% to 11.60, compared to 10.99 at the prior close. The VIX is -1.82% below the 11.82 20-day moving average. Its 30-day high is 14.49. Its 30-day low is 10.73. Its all-time closing low is 9.31 on December 22, 1993. The long-term average is 20.00.

    · The Euro Stoxx 50 volatility index (V2X) is 13.20, down -3.89% compared to 13.73 at the prior day's close. The V2X index trades -13.5% below its 15.25 20-day moving average, -32.6% below the 19.59 30-day high, and +1.70% above the 12.98 30-day low.

    · The Hang Seng volatility index (VHSI) closed at 13.00, down -0.15% compared to 13.02 at the prior close. The VHSI index trades -10.0% below its 14.454 20-day moving average. Its lowest historical close was 11.72, on June 30, 2005.

    · CBOE SKEW (SKEW) rose +1.06% to 126.71, compared to 125.38 the prior session, above a neutral reading (115-120), but below 130, a level that correlates with short-term market tops. The recent record high was 143.20 on December 20, 2013. 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:
     

    • At 8:30, May MoM retail sales rose +0.3%, compared to +0.6% survey and +0.5% revised prior.
    • May MoM retail sales ex auto rose +0.1%, compared to +0.4% survey and +0.4% revised prior.
    • May MoM retail sales ex-auto and gas rose +0.0%, compared to +0.4% survey and -0.1% revised prior.
    • May MoM import price index rose +0.1%, compared to +0.2% survey and -0.5% revised prior.
    • The latest weeks' initial and continuing jobless claims rose 317K and 2614K, respectively, compared to 310K and 2605K survey and 313K and 2603K revised prior.
    • At 10:00, April business inventories, with +0.4% survey and prior.


    Overseas Economic Reporting and News:
     

    • China - May YoY May M2 money supply rose 13.4%, compared to 13.1% survey and 13.2% prior.
    • Eurozone - April MoM industrials production rose +0.8%, compared to +0.5% survey and -0.4% revised prior. YoY industrial production rose +1.4%, compared to +0.9% survey and +0.2% revised prior.
    • France - May MoM CPI was +0.0%, compared to +0.0% survey and prior. YoY CPI was +0.8%, compared to +0.8% survey and prior.
    • Germany - May MoM wholesale prices fell -0.1%, compared to +0.2% prior. YoY wholesale prices fell -0.9%, compared to -1.3% prior.


    Company Ratings/News:
     

    • None.


    Wednesday's Trade. On lower and below average NYSE volume, major U.S. equity indexes fell in early trading, fell to mid-afternoon lows and improved through the final two hours, narrowing the day's losses. The SPX, DJI, Nasdaq, and NYSE composite fell -0.35%, -0.60%, -0.14%, and -0.38%, respectively. The SPX, DJI, Nasdaq, and NYSE composite are at least +1.61% higher in 2014. Market breadth was negative, with gainers 0.56x losing stocks. Most SPX market segments closed lower. Leaders were oil and gas, which rose +0.34%, and health care and technology, which fell at least -0.07%. Laggards were financials, industrials, and utilities, which fell at least -0.67%.

    Other notable indexes closed mixed. The Russell 2000 (RTY) fell -0.51% and is -3.47% below its March 4th record close. The Nasdaq Internet Index (QNET) rose +0.79% and is again in correction, -10.6% below its March 6th closing high. The Nasdaq Biotech Index (NBI) fell -0.09%, down -8.91% from its recent February 25th record high.

    NYSE volume fell -4.59% to 531.56 million shares, compared to 557.12 million shares the prior day, 0.84x the 630.80 million share 20-day moving average volume. Bond markets strengthened. The U.S. 10-year yield opened at 2.6520%, but fell by late morning to a 2.6113% intraday low. On the session, the yield fell -0.45 bps to 2.6394%, compared to 2.6439% at the prior close.

    From its prior day 1950.79 SPX close, June 2014 SPX futures (SPM4) suggested a moderately lower open. The index fell to 1944 in early trading, then traded narrowly through mid-afternoon, when it fell to the 1940.08 intraday low. During the final two hours, the index rose nearly to 1946, but eased at the close. The index closed at 1943.89, +80.9% above the 1074.77 October 4, 2011, intraday low, the bottom of the most recent correction.

    From its prior day 8,214.99 close, the DJ Transportation index (TRAN) fell -0.13%, compared to the DJI's +0.02% gain. The TRAN opened at the 8,196.10 intraday high, and fell to a mid-morning 8,113.66 intraday low, then traded narrowly around 8,140 to the close. The TRAN closed at 8,141.55. Volume rose +14.2% to 13.073 million shares, compared to 11.446 million shares the prior session, and 1.16x the 15-day moving average volume. The TRAN closed +1.44% and +4.51% above its 20- and 50-day moving averages, and +7.37% and +12.1% above its respective 100- and 200-day moving averages.

    Market volatility rose +5.55%, as the CBOE SPX volatility index (VIX) closed at 11.60, compared to 10.99 at the prior close. The index opened at 11.45, fell to an early afternoon 11.19 intraday low, then rose to a mid-afternoon 11.87 intraday high before easing to the close. The VIX's all-time closing low is 9.31, on December 22, 1993. Its record high is 89.53 in December 2008. Its lifetime average is 20.01. The CBOE put/call SKEW rose +0.57% to 125.38, compared to 124.67 the prior session, above a neutral 115-120 range, but below 130, a level that correlates well with short-term market tops.

    The market's technical factors were little changed. The SPX relative strength (RSI) fell to 68.06, compared to 73.36 the prior day, returning to the top of a neutral range, down from an overbought 73.73 on June 9th, and far better than an oversold 31.24 on February 3rd. The RSI compared to an overbought 71.26 on December 31st, when the SPX closed at an earlier record high, and compares to earlier oversold levels of 35.14 on August 27th and 39.19 on October 9th.

    This week, the SPX, DJI, and NYSE composite are down -0.28%, -0.48%, and -0.29%, respectively, while the Nasdaq is up +0.24%. Last week, the SPX, DJI, Nasdaq, and NYSE composite closed up +1.34%, +1.24%, +1.86%, and +1.38%, respectively. In June, the SPX, DJI, Nasdaq, and NYSE composite are up +1.06%, +0.76%, +2.11%, and +1.08%, respectively, compared to May, when the SPX, DJI, Nasdaq, and NYSE composite closed up +2.10%, +0.82%, +3.11%, and +1.22%, respectively.

    In 2014, the SPX, DJI, Nasdaq, and NYSE composite are up +3.16%, +2.84%, +2.61%, and +5.38%, respectively. 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 much lower and below average volume, the BKX fell -0.91% to 71.12, compared to 71.77 at the prior day's close, its 5th consecutive close above 70, but -2.46% below its 72.91 March 20th post-2008 closing high. In early trading, the index opened at the 71.52 intraday high, then trended lower to a mid-afternoon 70.92 intraday low. Volume rose +24.0% to 35.087 million shares, compared to 28.286 million shares the prior day, and 0.92x the 37.950 million share 15-day moving average.

    Large cap banks outperformed the regional banks, as the KBW regional banking index (KRX) fell -1.17%.

    This week, the BKX is up +0.42%, compared to last week, when the BKX closed up +2.77%. In June, the BKX is up +3.21%, compared to a April, when the BKX closed up +0.70%. In 2014, the BKX is up +2.69%, compared to the SPX's +5.17% gain. In 2013, the BKX rose +35.1%, better than the SPX's +29.6% rise.

    The BKX is now +20.6% better than the June 24, 2013, 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. On April 10th, the BKX fell below 70.00 and then eased consistently to the May 15th 66.81 closing low, its lowest close since early February. The BKX closed +121.1% 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 +80.9% in the same period.

    The BKX index closed -41.3% below its February 20, 2007, record 121.06 high. The BKX is up +282.0% from its 18.62 March 6, 2009, closing low, its low during the 2008-09 financial panic.

    Technical indicators were little changed. The index closed +3.16% and +2.84% above its respective 20- and 50-day moving averages, and +2.61% and +5.38% above its respective 100- and 200-day moving average. The 20-day moving average rose +12 bps to 68.94. The 69.16 50-day moving average fell -2 bps. Its 69.31 100-day moving average was unchanged, and the 200-day moving average rose +3 bps to 67.49. The 20-day closed (by -0.22 points) below the 50-day, and the negative gap narrowed +14 bps. The 50-day moving average closed (by +1.67 points) above the 200-day moving average, and the gap narrowed -6 bps. The 100-day moving average closed (by +1.82 points) above the 200-day moving average, and the gap fell -3 bps.

    The directional movement indicator narrowed to +19.232, compared to 25.404 the prior day, its 12th consecutive positive reading. Relative strength fell to 64.66, compared to 72.17 the prior day, returning to a neutral range, down from an overbought 73.14 on June 9th, up from the recent 32.95 low on February 3rd. The recent low RSI level was 31.08 on November 14, 2012, which is also the date of the BKX's 2012 closing low. Next resistance is 71.45; next support is 70.85.

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

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