North American Investment Grade CDS Index 83.74 +.86%
European Financial Sector CDS Index 115.75 +.12%
Western Europe Sovereign Debt CDS Index 172.83 bps -.48%
Emerging Market CDS Index 221.89 -1.17%
2-Year Swap Spread 20.0 unch.
TED Spread 19.0 +1 bp
Economic Gauges:
3-Month T-Bill Yield .12% -1 bp
Yield Curve 279.0 +4 bps
China Import Iron Ore Spot $178.0/Metric Tonne -1.17%
Citi US Economic Surprise Index +83.60 +6.3 points
10-Year TIPS Spread 2.47% +4 bps
Overseas Futures:
Nikkei Futures: Indicating +63 open in Japan
DAX Futures: Indicating +11 open in Germany
Portfolio:
Slightly Higher: On gains in my Technology and Biotech longs
Disclosed Trades: None
Market Exposure: 75% Net Long
BOTTOM LINE: Today's overall market action is bullish as the S&P 500 trades near session highs, despite rising energy prices, growing Mideast unrest, higher long-term rates and emerging markets inflation fears. On the positive side, Road&Rail, Homebuilding, HMO, Construction, Hospital, Networking, Semi and Coal shares are especially strong, rising more than 1.5%. Small-cap and Cyclical shares are outperforming. On the negative side, Airline, Restaurant, REIT, Insurance, Bank, Wireless and Utility shares are lower on the day. (XLF)/(IYR) are a bit heavy. The 10-year yield is rising +6 bps to 3.45%. China Iron Ore Spot is falling another -1.1% and is down -7.2% in about 2 weeks. The US Scrap Steel Benchmark has fallen about -5% in 2 days, which is the largest 2-day decline since Oct. of last year. The UBS-Bloomberg Ag Spot Index is rising +1.35% and is back near its record high. Moreover, copper is falling -.39%, lumber is dropping -1.33% and oil is surging +2.0%. The Saudi sovereign cds is rising +2.55% to 142.33 bps. The avg. US price for a gallon of gas is up another .02/gallon today to $3.39/gallon. It is now up .27/gallon in 15 days. The US dollar is trading poorly today given the data and Fed commentary. I suspect this weakness may reverse after the ECB meeting tomorrow. However, more dollar weakness would be another boost to oil. Investor complacency regarding the deteriorating situation in the Mideast remains high. The market's resiliency is impressive nonetheless. This could be a result of investors' anticipating a likely better-than-expected February jobs report on Fri. I would like to see better breadth, higher volume and a meaningful reversal lower in oil before shifting exposure in anticipation of further equity gains. As of now, this move looks like a bounce with further stock weakness likely before week's end. I expect US stocks to trade mixed-to-lower into the close from current levels on higher energy prices, growing Mideast unrest, more shorting, emerging markets inflation fears, higher long-term rates and profit-taking.
In my article, The US Dollar, Treasuries, Savings And Loans, Insurance Companies, And Bonds Traded Lower As The Seigniorage Of Neoliberalism Has Failed, I write
Today, February 2, 2010, the US Savings And Loans, the US Dollar, US Treasuries, and Bonds traded lower as the seigniorage of quantitative easing continued to exhaust.
Yahoo Finance reports that the Savings & Loans, traded 2.1% lower; Hudson City Bancorp, HCBK, fell 9.0%. Insurance companies, KIE, traded 1.9% lower.
The US Dollar, $USD, traded lower to 76.67; more dollar weakness likely mean higher oil, USO, DBC, and BNO, UCO, prices as well as higher gasoline, UGA, prices.
The 30 Year US Treasuries, EDV, and the 10 Year US Government Notes, TLT, traded lower with both commencing an Elliott Wave 3of 3 Down, as bond vigilantes called the interest rate on the 30 Year US Government Bond, $TYX, and the interest rate on the 10 Year US Government Note, $TNX, higher as Ben Bernanke’s QE 2 constitutes monetization of debt, which debases the US currency, the US Dollar.
Bonds, BND, traded lower in an Elliott Wave 3 Down which started March 1, 2001 from a fall on February 28, 2011 at a price of 80.13. A run of bonds has commenced.
The old political and economic paradigm failed February 22, 2011, as seigniorage failed with the downturn in distressed securities, like those held in FAGIX, which caused the stock market, ACWI, to turn lower. Neoliberalism is a dead man walking; it is a bankrupt, burned out and zombie economic and political paradigm that has turned toxic and cannot sustain investment or growth.
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In my article, The US Dollar, Treasuries, Savings And Loans, Insurance Companies, And Bonds Traded Lower As The Seigniorage Of Neoliberalism Has Failed, I write
Today, February 2, 2010, the US Savings And Loans, the US Dollar, US Treasuries, and Bonds traded lower as the seigniorage of quantitative easing continued to exhaust.
Yahoo Finance reports that the Savings & Loans, traded 2.1% lower; Hudson City Bancorp, HCBK, fell 9.0%. Insurance companies, KIE, traded 1.9% lower.
The US Dollar, $USD, traded lower to 76.67; more dollar weakness likely mean higher oil, USO, DBC, and BNO, UCO, prices as well as higher gasoline, UGA, prices.
The 30 Year US Treasuries, EDV, and the 10 Year US Government Notes, TLT, traded lower with both commencing an Elliott Wave 3of 3 Down, as bond vigilantes called the interest rate on the 30 Year US Government Bond, $TYX, and the interest rate on the 10 Year US Government Note, $TNX, higher as Ben Bernanke’s QE 2 constitutes monetization of debt, which debases the US currency, the US Dollar.
Bonds, BND, traded lower in an Elliott Wave 3 Down which started March 1, 2001 from a fall on February 28, 2011 at a price of 80.13. A run of bonds has commenced.
The old political and economic paradigm failed February 22, 2011, as seigniorage failed with the downturn in distressed securities, like those held in FAGIX, which caused the stock market, ACWI, to turn lower. Neoliberalism is a dead man walking; it is a bankrupt, burned out and zombie economic and political paradigm that has turned toxic and cannot sustain investment or growth.
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