Style Underperformer:
Sector Underperformers:
- 1) Disk Drives -2.23% 2) Semis -.37% 3) Biotech -.23%
Stocks Falling on Unusual Volume:
- WRLD, RYAAY, BPI, UBS, RNF, CS, GVA, NQ, FBRC, IDCC, EDMC, ELLI, FLDM, GTLS, EPAY, ICGE, DD, CVRR, MW, BSFT, NPO, VSI, KORS, CLMT, MSG and PENN
Stocks With Unusual Put Option Activity:
- 1) CVC 2) AOL 3) XME 4) FDX 5) NVDA
Stocks With Most Negative News Mentions:
- 1) AVP 2) AMZN 3) ICE 4) NTAP 5) AFL
Charts:
Style Outperformer:
Sector Outperformers:
- 1) Coal +2.41% 2) Steel +1.98% 3) Homebuilders +1.89%
Stocks Rising on Unusual Volume:
- TPH, BRY, VECO, CVA, SFY, GTI, LINE, VMC, RLGY, ZLTQ, CSIQ, SYY, SCTY, X, FSLR, NUAN, QLIK, SPWR, HWAY, WLT, AOL, GRPN and VOLC
Stocks With Unusual Call Option Activity:
- 1) DNR 2) AKS 3) STZ 4) TPX 5) MAT
Stocks With Most Positive News Mentions:
- 1) K 2) AAPL 3) LMT 4) T 5) MON
Charts:
Weekend Headlines
Bloomberg:
- Xi Borrows From Mao Playbook in Power Play Ahead of Plenum. The
mission for the near-dozen Communists sitting round a table at a
Beijing ministry was explicit: criticize their boss, who was present.
Party cadres carefully recorded their comments as they spoke, in an echo
of sessions held decades ago under Chairman Mao Zedong’s direction.
- Park Calls for Ending ’Vicious Cycle’ of Appeasing North Korea. South Korean President Park Geun Hye
called for ending the “vicious cycle” of rewarding North
Korean provocations, saying it complicates negotiations and
emboldens the Kim Jong Un regime to advance its nuclear program. “We
cannot repeat the vicious cycle of the past where
North Korea’s nuke threats and provocations were met with rewards and
coddling,” she told BBC World News in an interview that aired today.
“Otherwise, North Korea will continue to further advance its nuclear
capability.”
- Asian Stocks Fall After Fisher Speech on Fed Policy. Asian
stocks fell after Federal Reserve Bank of Dallas President Richard
Fisher said the U.S. central bank should end its record stimulus as soon
as possible. South Korean financial companies including Woori Finance
Holdings Co., Shinhan Financial Group Co., Mirae Asset Securities Co.
and Hana Financial Group Inc. dropped more than 1.6 percent. Coca-Cola
Amatil Ltd. (CCL), Australia’s largest listed drinks company, slumped
4.9 percent after forecasting 2013 earnings will decline. China
Resources Enterprise Ltd., a brewer and retailer with businesses in Hong
Kong and mainland China, gained 1.5 percent. The MSCI Asia Pacific excluding Japan Index fell 0.2
percent to 478.49 as of 11:47 a.m. in Hong Kong, after rising as
much as 0.2 percent.
- Euro at Six-Week Low on ECB; Aussie Climbs as Spending Surges. The euro fell to its lowest level in
more than six weeks before European Central Bank Executive Board
member Joerg Asmussen speaks in the run-up to a policy meeting
amid signs further stimulus may be needed in the region. The euro
fell 0.1 percent to $1.3480 as of 12:43 p.m. in Singapore, and last week
dropped 2.3 percent, the largest decrease since the five days ended
July 6, 2012. It fell as low
as $1.3442 today, the least since Sept. 18.
- Rebar Fluctuates as Investors Await China Party Plenum Meeting.
Steel reinforcement-bar futures swung
between gains and losses before a meeting of China’s top Communist Party
officials in Beijing which will map out a blueprint for economic
reform. Rebar for May delivery, the most-active contract by volume on
the Shanghai Futures Exchange, rose as much as 0.4 percent to 3,685
yuan ($603) a ton and fell as low as 3,666 yuan before
trading at 3,670 yuan by 10:41 a.m. local time. The contract
lost 1.5 percent last month.
- Junk Loans Approach $1
Trillion as Standards Dip: Credit Markets. Loans to junk related
companies in the U.S. are on pace to exceed $1 trillion this year, a
level not seen before the financial crisis, as concern rises that
lenders are lowering their standards. The almost $873 billion of
leveraged loans made in 2013 to borrowers ranging from hotel chain
Hilton Worldwide Holdings Inc. to coal producer Peabody Energy Corp. is
more than the $642.3 billion obtained in all of last year and up from
the post-crisis low of $161.5 billion in 2009, according to Bloomberg.
At the current rate, the record of $899.1 billion in 2007 may be
eclipsed as soon as this week.
- Fed Gives Banks New Dire Scenarios for 2014 Stress Tests. Lenders
including JPMorgan Chase & Co. (JPM) and Citigroup Inc. (C)
will have to show they can survive the demise of a trading partner or a
plunge in value of high-risk business loans in the 2014 version of U.S.
stress tests. The scenarios for the annual tests, outlined by the
Federal
Reserve in a statement yesterday, reflect some of the most
pressing threats seen by regulators as they gauge the ability of
the U.S. financial system to withstand economic shocks. Bankers
will have to show what would happen to the value of leveraged
loans they hold, the impact of another housing bust and how
they’d fare if a firm that owes them substantial sums collapses.
- Health Site Flaws Test Democrats’ Unity as Attacks Rise.
Democratic Senator Joe Manchin of West Virginia announced he is
drafting legislation with Republican Senator Johnny Isakson of Georgia
to postpone the law’s penalty for failing to obtain health insurance, a
core provision that the White House has insisted on maintaining without
delay. Senator Mary Landrieu of Louisiana, a Democrat facing re-election
in a state that backed Obama’s Republican opponents in 2008 and 2012,
said in an interview this week that Obama should
fire some staff members to hold them accountable for the
website’s problems. She stopped short of joining demands from
Republicans for Sebelius’s resignation. Health and Human Services officials who testified this week
before House committees will appear next week in front of two
Senate panels whose Republican members have been outspoken in
criticizing them.
- Obama’s ‘Dishonesty’ Could Slow Second Term.
President Barack Obama continued to take political heat for the
troubled debut of his signature health plan while his advisers
downplayed the significance of the program’s low enrollment rate. Mitt
Romney, the Republican candidate who lost the 2012 presidential race to
Democrat Obama, accused the president of lying. “He wasn’t telling the
truth,” Romney said today on NBC’s
“Meet the Press.” “That fundamental dishonesty has really -- has really put
in peril the whole foundation of his second term,” Romney said.
“I think it is rotting it away.” During the presidential campaign and later, as Congress
debated the Affordable Health Care Act, Obama repeatedly said
that no one would be forced to give up their existing health
coverage under the law. The statement “undermined the president’s credibility,”
Romney said.
- Obamacare Birth Control Rule Assailed by Court as Split Widens. A requirement of President Barack Obama’s health-care law that group insurance plans cover
contraceptives may violate religious freedom, a U.S. appeals
court said, widening a split among the circuits and making it
more probable the U.S. Supreme Court will take up the issue. A three-judge panel in Washington said a lower court was
wrong to deny an injunction sought in a lawsuit by two brothers
who are Catholic. The men sued on religious grounds, seeking to
exclude contraceptive coverage from health plans provided by
their produce-distribution companies. While the panel didn’t
rule on the actual challenge, they disagreed with the trial
judge’s determination that the suit was unlikely to succeed.
Wall Street Journal:
- Investors Return to IPOs in Force. Investors
are stampeding into initial public offerings at the fastest clip since
the financial crisis, fueling a frenzy in the shares of newly listed
companies that echoes the technology-stock craze of the late 1990s.
- You Also Can't Keep Your Doctor. I had great cancer doctors and health insurance. My plan was cancelled. Now I worry how long I'll live.
Everyone now is clamoring about Affordable Care Act winners and losers.
I am one of the losers. My grievance is not political; all my energies
are directed to enjoying
life and staying alive, and I have no time for politics. For almost
seven years I have fought and survived stage-4 gallbladder cancer, with a
five-year survival rate of less than 2% after diagnosis. I am a
determined fighter and extremely lucky. But this luck may have just run
out: My affordable, lifesaving medical insurance policy has been
canceled effective Dec. 31.
Fox News:
CNBC:
- For signs of bubble, look no further than LBOs.
Market watchers who have been out hunting for bubbles may want to look
at debt rather than equity. A number of measures that focus on leverage,
particularly in the area of corporate takeovers, show that kind of
risk-taking back at levels just before the financial system imploded and
sent the economy into its worst slump since the Great Depression. Leveraged
buyouts—LBOs—for both big and midsize companies are approaching debt
levels last experienced in 2007, according to the latest figures from
Thomson Reuters.
Business Insider:
New York Times:
- After Delay, Lenders Set To Visit Greece for Audit.
Inspectors from Greece’s international lenders have put a postponed
visit to the country back on the agenda and will return early this week
after Athens made a new proposal on filling a gap of 2 billion euros in
the 2014 budget, the European Commission has said.
New York Post:
Real Clear Politics:
- Obamacare's Widening Disconnect.
Our relationship with government is in shambles, our feeling of
disconnect with Washington at an historic level. Yet the real problem is
not a health-care website that doesn’t work.
The real problem is a president and a Washington culture which both
believe it is okay to lie to get a bill passed. There is no connection
between such behavior and the values of most
Americans beyond Washington, for whom getting what you want usually
results from hard work, honest bargaining and a little compromise.
Reuters:
- Egypt to look beyond U.S. for arms: foreign minister.
Egypt's Foreign Minister Nabil Fahmy said on Saturday that Egypt would
look beyond the United States to meet its security needs and warned
Washington that it could no longer ignore popular demands in a changed
Arab world. Speaking ahead of a visit by U.S. Secretary of State John
Kerry, Fahmy said the United States must take a long-term view of its
relations with Egypt and understand that in the wake of the Arab Spring,
"it would have to deal now with the Arab peoples, not only with Arab
governments".
- Italian banks' cut plans too modest despite strike call. With Italy mired in its longest recession since the Second World War, the country's hard-pressed banks are cutting jobs, closing branches and infuriating unions, but the cuts
are far too modest to achieve the profitability gains they need.
Financial Times:
- Europe's Big Banks Cut Corporate Lending, Boost Sovereign Debt.
Region's 16 largest banks lowered risk exposure to corporate credit by
9%, while raising risk exposure to sovereign debt by 26% in 2011, 2012,
citing Fitch Ratings. Fitch cites approaching Basel III capital rules as
being partly to blame for decline in corporate credit lending.
Telegraph:
Tagesspiegel:
- Schaeuble
Says No ESM Money for Ailing Banks. German Finance Minister Wolfgang
Schaeuble says his party agreed with potential coalition partner SPD not
to consent to spending tax money to save banks in Europe, particularly
not from the ESM.
China Securities Journal:
- China's Property Bubble Is "Danger" to Economy. China's real
estate bubble poses "danger" to economy and the government should
combine property controls with economic reform of land and tax policies,
according to a front-page editorial. It is urgent to reduce bubble
caused by speculation and reduce potential financial and economic risks.
Weekend Recommendations
Barron's:
- Bullish commentary on (CVA) and (DFS).
Night Trading
- Asian indices are -.50% to unch. on average.
- Asia Ex-Japan Investment Grade CDS Index 134.0 +4.0 basis points.
- Asia Pacific Sovereign CDS Index 103.50 +4.0 basis points.
- NASDAQ 100 futures +.25%.
Morning Preview Links
Earnings of Note
Company/Estimate
Economic Releases
10:00 am EST
- Factory Orders for September are estimated to rise +1.8%.
Upcoming Splits
Other Potential Market Movers
- The
Fed's Powell speaking, Fed's Rosengren speaking, Eurozone PMI, RBA rate
decision, ISM New York for October and the Robert W. Baird Industrial
Conference could also impact trading today.
BOTTOM LINE: Asian indices are modestly lower, weighed down by technology and commodity
shares in the region. I expect US stocks to open modestly higher and
to weaken into the afternoon, finishing mixed. The Portfolio is 50%
net long heading into the week.
Wall St. Week Ahead by Reuters.
Stocks to Watch Monday by MarketWatch.
Weekly Economic Calendar by Briefing.com.
BOTTOM LINE: I expect US stocks to finish the week modestly lower on rising global
growth fears, profit-taking, technical selling, rising
eurozone/emerging markets debt angst, more shorting and earnings
concerns. My intermediate-term trading indicators are giving neutral
signals and the Portfolio is 50% net long heading into the week.
S&P 500 1,761.64 +.11%*
The Weekly Wrap by Briefing.com.
*5-Day Change
Indices
- Russell 2000 1,095.67 -2.03%
- S&P 500 High Beta 28.64 unch.
- Wilshire 5000 18,489.03 -.18%
- Russell 1000 Growth 821.38 +.04%
- Russell 1000 Value 886.85 -.02%
- S&P 500 Consumer Staples 437.16 +1.14%
- Morgan Stanley Cyclical 1,384.67 +.37%
- Morgan Stanley Technology 845.27 -.10%
- Transports 7,047.77 +.55%
- Bloomberg European Bank/Financial Services 106.0 -.42%
- MSCI Emerging Markets 42.66 +.08%
- HFRX Equity Hedge 1,139.94 -.04%
- HFRX Equity Market Neutral 941.74 -.05%
Sentiment/Internals
- NYSE Cumulative A/D Line 194,884 -.51%
- Bloomberg New Highs-Lows Index 200 -432
- Bloomberg Crude Oil % Bulls 24.14 +49.7%
- CFTC Oil Net Speculative Position 299,196 -1.23%
- CFTC Oil Total Open Interest 1,785,295 -2.17%
- OEX Put/Call .99 +312.50%
- ISE Sentiment 112.0 +24.44%
- Volatility(VIX) 13.28 +1.45%
- S&P 500 Implied Correlation 40.29 +8.28%
- G7 Currency Volatility (VXY) 8.12 +7.27%
- Emerging Markets Currency Volatility (EM-VXY) 8.60 +7.23%
- Smart Money Flow Index 11,782.48 -.04%
- Money Mkt Mutual Fund Assets $2.669 Trillion +.04%
Futures Spot Prices
- Reformulated Gasoline 254.19 -1.20%
- Heating Oil 288.23 -1.03%
- Bloomberg Base Metals Index 193.97 +1.33%
- US No. 1 Heavy Melt Scrap Steel 335.67 USD/Ton unch.
- China Iron Ore Spot 135.30 USD/Ton +1.50%
- UBS-Bloomberg Agriculture 1,388.20 -2.92%
Economy
- ECRI Weekly Leading Economic Index Growth Rate 1.70% -30 basis points
- Philly Fed ADS Real-Time Business Conditions Index .1075 -.74%
- S&P 500 Blended Forward 12 Months Mean EPS Estimate 119.18 +.23%
- Citi US Economic Surprise Index 5.30 -11.7 points
- Citi Emerging Markets Economic Surprise Index -8.80 -3.20 points
- Fed Fund Futures imply 36.0% chance of no change, 64.0% chance of 25 basis point cut on 12/18
- US Dollar Index 80.72 +1.90%
- Euro/Yen Carry Return Index 138.86 -.97%
- Yield Curve 231.0 +10 basis points
- 10-Year US Treasury Yield 2.62% +11 basis points
- Federal Reserve's Balance Sheet $3.800 Trillion +.12%
- U.S. Sovereign Debt Credit Default Swap 30.21 -19.37%
- Illinois Municipal Debt Credit Default Swap 189.0 +4.83%
- Western Europe Sovereign Debt Credit Default Swap Index 68.38 -.89%
- Asia Pacific Sovereign Debt Credit Default Swap Index 103.55 +3.33%
- Emerging Markets Sovereign Debt CDS Index 233.26 +8.31%
- Israel Sovereign Debt Credit Default Swap 112.0 +3.22%
- Egypt Sovereign Debt Credit Default Swap 694.31 +1.36%
- China Blended Corporate Spread Index 364.0 -8 basis points
- 10-Year TIPS Spread 2.14% -5 basis points
- TED Spread 20.25 -.5 basis point
- 2-Year Swap Spread 11.75 -1.0 basis point
- 3-Month EUR/USD Cross-Currency Basis Swap -4.25 -.5 basis point
- N. America Investment Grade Credit Default Swap Index 74.25 +3.20%
- European Financial Sector Credit Default Swap Index 116.60 -6.99%
- Emerging Markets Credit Default Swap Index 277.66 +6.11%
- CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 110.0 -2.5 basis points
- M1 Money Supply $2.684 Trillion +1.18%
- Commercial Paper Outstanding 1,081.50 +1.80%
- 4-Week Moving Average of Jobless Claims 356,300 +8,000
- Continuing Claims Unemployment Rate 2.2% unch.
- Average 30-Year Mortgage Rate 4.10% -3 basis points
- Weekly Mortgage Applications 483.70 +6.42%
- Bloomberg Consumer Comfort -37.60 -1.5 points
- Weekly Retail Sales +3.20% +20 basis points
- Nationwide Gas $3.27/gallon -.05/gallon
- Baltic Dry Index 1,504 -11.94%
- China (Export) Containerized Freight Index 1,011.55 +3.64%
- Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 32.50 +18.18%
- Rail Freight Carloads 261,231 -1.31%
Best Performing Style
Worst Performing Style
Leading Sectors
Lagging Sectors
Weekly High-Volume Stock Gainers (29)
- ZLTQ, NTRI, FLDM, NUVA, CRR, MSTR, DWA, BGFV, FARO, XYL, LOCK, CCIX, BWLD, THRM, KFRC, DIN, ATRC, PBI, POWI, MCHP, SCBT, ROG, TRI, ACHC, ZINC, EPIQ, STBZ, LOPE and PCCC
Weekly High-Volume Stock Losers (45)
- N, EXLS, ALSN, CAP, DATA, CVLT, QLIK, AGCO, PCL, MSM, EXAM, MASI, HWAY, WU, CROX, CRUS, MWV, IPHS, SFLY, HGG, FDP, CYNO, PLT, SANM, MDAS, BLKB, WTW, SPSC, ZEUS, WPP, DAN, DLR, PRXL, EW, AVP, DCO, TNGO, BBOX, AAWW, GTLS, JIVE, STRA, VOLC, RATE and BYD
Weekly Charts
ETFs
Stocks
*5-Day Change
