BETWEEN THE HEDGES

Friday, June 20, 2014

Market Week in Review

Posted by Gary .....at 7:24 PM

S&P 500 1,962.87 +1.38%*

The Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Posted by Gary .....at 7:19 PM

Indices

S&P 500 1,962.87 +1.38%

DJIA 16,947.08 +1.02%

NASDAQ 4,368.04 +1.33%

Russell 2000 1,188.43 +2.21%

S&P 500 High Beta 33.08 +1.93%

Wilshire 5000 20,574.82 +1.49%

Russell 1000 Growth 907.93 +1.19%

Russell 1000 Value 997.39 +1.63%

S&P 500 Consumer Staples 465.82 +1.81%

Morgan Stanley Cyclical 1,595.20 +1.65%

Morgan Stanley Technology 954.80 +.72%

Transports 8,205.11 +2.02%

Utilities 566.46 +4.43%

Bloomberg European Bank/Financial Services 110.26 -1.87%

MSCI Emerging Markets 43.39 -.40%

HFRX Equity Hedge 1,174.96 +.13%
HFRX Equity Market Neutral 962.94 -.31%

Sentiment/Internals

NYSE Cumulative A/D Line 227,906 +1.39%

Bloomberg New Highs-Lows Index 728 +502

Bloomberg Crude Oil % Bulls 50.0 -23.52%

CFTC Oil Net Speculative Position 457,156 +9.36%

CFTC Oil Total Open Interest 1,721,703 +2.71%

Total Put/Call .77 +1.32%

OEX Put/Call .99 -59.43%

ISE Sentiment 86.0 +13.16%

NYSE Arms 1.05 +87.50%

Volatility(VIX) 10.85 -10.92%

S&P 500 Implied Correlation 48.39 -8.59%

G7 Currency Volatility (VXY) 5.46 -3.87%

Emerging Markets Currency Volatility (EM-VXY) 5.97 -9.41%

Smart Money Flow Index 11,437.22 +1.79%

ICI Money Mkt Mutual Fund Assets $2.551 Trillion -1.21%
ICI US Equity Weekly Net New Cash Flow -$1.469 Billion

AAII % Bulls 35.2 -21.3%
AAII % Bears 24.1 +13.55%

Futures Spot Prices

CRB Index 312.93 +.95%

Crude Oil 106.83 +.06%

Reformulated Gasoline 312.77 +2.25%

Natural Gas 4.53 -4.69%

Heating Oil 305.12 +2.26%

Gold 1,316.60 +3.13%

Bloomberg Base Metals Index 193.69 2.10%

Copper 312.15 +3.14%

US No. 1 Heavy Melt Scrap Steel 357.0 USD/Ton -1.83%

China Iron Ore Spot 92.10 USD/Ton +1.32%

Lumber 328.70 +6.65%

UBS-Bloomberg Agriculture 1,484.95 +1.51%

Economy

ECRI Weekly Leading Economic Index Growth Rate 4.5% unch.

Philly Fed ADS Real-Time Business Conditions Index .1439 -3.16%

S&P 500 Blended Forward 12 Months Mean EPS Estimate 124.82 +.25%

Citi US Economic Surprise Index -10.20 +9.3 points

Citi Emerging Markets Economic Surprise Index -8.30 -2.2 points

Fed Fund Futures imply 44.0% chance of no change, 56.0% chance of 25 basis point cut on 7/30

US Dollar Index 80.37 -.30%

Euro/Yen Carry Return Index 144.86 +.39%

Yield Curve 215.0 unch.

10-Year US Treasury Yield 2.61% +1 basis point

Federal Reserve's Balance Sheet $4.325 Trillion +.63%

U.S. Sovereign Debt Credit Default Swap 17.46 +3.04%

Illinois Municipal Debt Credit Default Swap 155.0 -.60%

Western Europe Sovereign Debt Credit Default Swap Index 29.19 +3.95%

Asia Pacific Sovereign Debt Credit Default Swap Index 74.55 -3.46%

Emerging Markets Sovereign Debt CDS Index 194.92 +1.22%

Israel Sovereign Debt Credit Default Swap 75.0 +8.7%
Iraq Sovereign Debt Credit Default Swap 326.70 +20.3%

Russia Sovereign Debt Credit Default Swap 189.34 +3.27%

China Blended Corporate Spread Index 311.26 -.99%

10-Year TIPS Spread 2.27% +9.0 basis points

TED Spread 202.0 +1.75 basis points

2-Year Swap Spread 14.75 +.25 basis point

3-Month EUR/USD Cross-Currency Basis Swap -8.75 +4.5 basis points

N. America Investment Grade Credit Default Swap Index 56.15 -5.49%

European Financial Sector Credit Default Swap Index 59.34 -1.48%

Emerging Markets Credit Default Swap Index 235.72 -4.33%

CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 84.0 -1.0 basis point

M1 Money Supply $2.834 Trillion +.12%

Commercial Paper Outstanding 1,042.40 -.40%

4-Week Moving Average of Jobless Claims 311,750 -3,500

Continuing Claims Unemployment Rate 1.9% -10 basis points

Average 30-Year Mortgage Rate 4.17% -3 basis points

Weekly Mortgage Applications 351.60 -9.17%

Bloomberg Consumer Comfort 37.1 +1.6 points

Weekly Retail Sales +3.40% +10 basis points

Nationwide Gas $3.65/gallon -.01/gallon

Baltic Dry Index 904.0 -.22%

China (Export) Containerized Freight Index 1,093.45 -.86%

Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 25.0 unch.

Rail Freight Carloads 270,243 +.16%

Best Performing Style

Small-Cap Growth +2.6%

Worst Performing Style

Large-Cap Growth +1.2%

Leading Sectors

Gold & Silver +6.7%

Alt Energy +6.1%

3D Printing +5.7%

Disk Drives +5.1%

Utilities +4.4%

Lagging Sectors

Internet +.5%

Telecom +.2%

Construction unch.

Defense -.3%

Networking -1.6%

Weekly High-Volume Stock Gainers (14)

FIO, TRGP, WMB, TAT, TAHO, RHT, APD, VDSI, TRBAA, MDT, CHSP, NGHC, RVNC and LVLT

Weekly High-Volume Stock Losers (4)

KFY, COH, CAG and PIR

Weekly Charts
ETFs

High-Volume Gainers

High-Volume Losers

Stocks

High-Volume Gainers

High-Volume Losers

*5-Day Change

Stocks Slightly Higher into Final Hour on Less Emerging Markets Debt Angst, Yen Weakness, Short-Covering, Biotech/Energy Sector Strength

Posted by Gary .....at 3:35 PM

Broad Equity Market Tone:

Advance/Decline Line: About Even

Sector Performance: Mixed

Volume: Slightly Below Average

Market Leading Stocks: Performing In Line

Equity Investor Angst:

Volatility(VIX) 10.97 +3.3%

Euro/Yen Carry Return Index 144.90 +.07%

Emerging Markets Currency Volatility(VXY) 5.97 +1.19%

S&P 500 Implied Correlation 48.47 +4.39%

ISE Sentiment Index 88.0 -26.05%

Total Put/Call .77 +14.93%

NYSE Arms 1.12 +11.90%

Credit Investor Angst:

North American Investment Grade CDS Index 56.69 +.74%

European Financial Sector CDS Index 59.34 +2.64%

Western Europe Sovereign Debt CDS Index 29.29 -1.66%

Asia Pacific Sovereign Debt CDS Index 74.65 -1.22%

Emerging Market CDS Index 235.06 -4.50%

China Blended Corporate Spread Index 311.27 +1.03%

2-Year Swap Spread 14.75 -.75 basis point

TED Spread 22.0 unch.

3-Month EUR/USD Cross-Currency Basis Swap -8.75 -2.25 basis points

Economic Gauges:

3-Month T-Bill Yield .01% unch.

Yield Curve 216.0 -1.0 basis point

China Import Iron Ore Spot $90.70/Metric Tonne +1.54%

Citi US Economic Surprise Index -10.20 unch.

Citi Emerging Markets Economic Surprise Index -8.30 +.4 point

10-Year TIPS Spread 2.27 +3.0 basis points

Overseas Futures:

Nikkei Futures: Indicating +101 open in Japan

DAX Futures: Indicating +4 open in Germany

Portfolio:

Slightly Higher: On gains in my biotech sector longs and emerging markets shorts

Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

Market Exposure: Moved to 75% Net Long

Today's Headlines

Posted by Gary .....at 3:02 PM

Bloomberg:

Ukraine Declares Cease-Fire After U.S. Expands Sanctions. Ukraine announced a week-long unilateral cease-fire in its easternmost regions after the U.S. imposed sanctions on people linked to the insurgency and accused Russia of providing new military aid to separatists. Ukraine called on all fighters to lay down arms, halting the government offensive against rebels until June 27, the Interior Ministry in Kiev said in a website statement, citing President Petro Poroshenko. “The days ahead will be very decisive for what we can decide” at the summit on June 26-27, Merkel told reporters in Berlin. “We expect Russia to respond in a positive and constructive way.” While Germany wants to see a cease-fire, “there is planning” for other outcomes as well, she said.
Top Shiite Cleric Adds to U.S. Pressure on Iraqi Leaders. Iraq’s top Shiite cleric added to U.S. pressure on Prime Minister Nouri al-Maliki and his political allies to form a new government that can command support across sectarian lines. Grand Ayatollah Ali al-Sistani, who played a key role in calming sectarian tensions in previous years, today called for the creation of a new “effective” government.
U.S. Investors in China’s Internet Companies Face Risks. U.S. shareholders face “major risks” from investing in Chinese Internet companies such as Alibaba Group Holding Ltd. that use a variable interest entity, according to a U.S. congressional commission report. Risks are associated with VIEs because the structures create holding companies to link foreign investors to Chinese firms via a set of complex legal contracts, according to the June 18 report by the U.S.-China Economic and Security Review Commission. There is a “high probability” Chinese courts will not uphold those contracts, the report said.
China Property Failures Seen as $33 Billion in Trusts Due. Chinese property trusts face record repayments next year as the real-estate market cools, fueling speculation among bond funds that more developers will collapse. The trusts, which channel money from wealthy individuals to smaller builders that have trouble obtaining financing elsewhere, must repay 203.5 billion yuan ($32.7 billion) in 2015, according to Use Trust, a Chinese research firm. That’s almost double the 109 billion yuan due this year. New issuance of the products slumped to 40.7 billion yuan this quarter, the least in more than two years, Use Trust data show.
WTI Advances for Second Day, Narrowing Discount to Brent. Brent for August settlement slipped 42 cents, or 0.4 percent, to $114.64 a barrel on the London-based ICE Futures Europe exchange at 1:50 p.m. in New York. It climbed to $115.06 yesterday, the highest close since Sept.
ABA’s Keating Says Regulations Throttling Small Banks. Excessive regulation is strangling U.S. community banks, which have closed at the rate of about one per business day since the 2008 financial crisis, said Frank Keating, head of the American Bankers Association. Community banks spend about 15 percent of revenue on compliance even though they weren’t responsible for the credit crisis that spurred new regulations including higher capital requirements, said Keating, the Washington-based trade group’s chief executive officer.
Gold Options Signal More Gains as Yellen Shakes Up Market. Janet Yellen is breathing life back into the gold market. Trading in bullion options show the biggest rally in nine months has more to run after some contracts betting on higher prices surged by the most since 2012 yesterday. Fed Chair Yellen’s outlook for low U.S. interest rates is bringing investors back to gold after a measure of volatility sank to the lowest since 2010 earlier this week.
Marijuana Considered for Looser Restrictions by U.S. FDA. U.S. regulators are studying whether restrictions on marijuana should be eased, a step toward decriminalizing the drug at the federal level.

Wall Street Journal:

Iraq's Top Shiite Cleric Calls for New Government. 'Effective' Government Needed That 'Avoids Past Mistakes'.
The Asset-Rich, Income-Poor Economy by Keven Warsh and Stanley Druckenmiller. The Fed's balance-sheet recovery hasn't stirred business investment, an opportunity killer for workers.

Fox News:

'We did not know': 9 times the Obama administration was blindsided.

CNBC:

It's Official: The Boomerang Kids Won't Leave.

ZeroHedge:

Business Insider:

Washington Examiner:

Obamacare Is Hurting Millions.

World Steel Association:

May 2014 crude steel production. (graph)

Reuters:

U.S. CDC says 86 lab workers possibly exposed to live anthrax bacteria.

Telegraph:

Interest rates need to be raised – and fast. A normal recovery is kicking in, but the Bank of England still seems oddly bewildered.

Bear Radar

Posted by Gary .....at 1:14 PM

Style Underperformer:

Small-Cap Growth -.10%

Sector Underperformers:

1) Gold & Silver -1.21% 2) Social Media -1.15% 3) Homebuilders -.84%

Stocks Falling on Unusual Volume:

EXL, KND, EMES, TRGP, NGLS, COH, SWHC, ORCL, PIR, BECN, ITC, DRI, TIBX, TCP, PSB, TOUR, OC, CAG, AMKR, FBHS, DB, REGN, COV, DL, JOBS, CBS, WFM, SAH, OLED and DGI

Stocks With Unusual Put Option Activity: