Market Week in Review

S&P 500 1,408.47 +.81%*



The Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Indices

• S&P 500 1,408.47 +.81%
  
• DJIA 13,212.04 +1.0%
  
• NASDAQ 3,091.57 +.77%
  
• Russell 2000 830.30 +.03%
  
• Wilshire 5000 14,627.44 +.71%
  
• Russell 1000 Growth 663.73 +.93%
  
• Russell 1000 Value 691.34 +.62%
  
• Morgan Stanley Consumer 801.54 +1.20%
  
• Morgan Stanley Cyclical 1,017.02 -.31%
• Morgan Stanley Technology 716.79 +1.36%
  
• Transports 5,253.16 +.68%
  
• Utilities 458.93 +1.36%
  
• MSCI Emerging Markets 43.06 +.04%
  
• Lyxor L/S Equity Long Bias Index 1,039.41 -.08%
  
• Lyxor L/S Equity Variable Bias Index 822.11 +.38%
  
• Lyxor L/S Equity Short Bias Index 538.99 unch.
  

Sentiment/Internals

• NYSE Cumulative A/D Line 145,222 -.02%
  
• Bloomberg New Highs-Lows Index -77 -80
  
• Bloomberg Crude Oil % Bulls 12.0 -7.7%
  
• CFTC Oil Net Speculative Position 229,452 -2.2%
  
• CFTC Oil Total Open Interest 1,562,147 +.25%
  
• Total Put/Call .97 -6.73%
  
• OEX Put/Call 1.07 +3.88%
  
• ISE Sentiment 97.0 -9.35%
  
• NYSE Arms .68 -26.09%
  
• Volatility(VIX) 15.50 +4.59%
• S&P 500 Implied Correlation 61.09 -2.04%
  
• G7 Currency Volatility (VXY) 10.08 -.59%
  
• Smart Money Flow Index 11,114.31 +.54%
  
• Money Mkt Mutual Fund Assets $2.605 Trillion -.70%
  
• AAII % Bulls 42.47 +.21%
  
• AAII % Bears 25.48 -8.38%

Futures Spot Prices

• CRB Index 308.46 -1.91%
  
• Crude Oil 103.02 -3.49%
  
• Reformulated Gasoline 330.81 -1.69%
  
• Natural Gas 2.13 -10.22%
  
• Heating Oil 317.01 -1.61%
  
• Gold 1,671.90 +.50%
  
• Bloomberg Base Metals Index 219.61 +.06%
  
• Copper 382.50 +.46%
  
• US No. 1 Heavy Melt Scrap Steel 402.93 USD/Ton -.10%
  
• China Iron Ore Spot 147.60 USD/Ton +1.65%
  
• Lumber 260.90 +.11%
  
• UBS-Bloomberg Agriculture 1,554.92 +.41%
  

Economy

• ECRI Weekly Leading Economic Index Growth Rate 0.0% +80 basis points
• Philly Fed ADS Real-Time Business Conditions Index -.0427 +11.59%
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 108.55 +.23%
  
• Citi US Economic Surprise Index 18.90 -8.5 points
  
• Fed Fund Futures imply 50.0% chance of no change, 50.0% chance of 25 basis point cut on 4/25
  
• US Dollar Index 79.0 +.11%
  
• Yield Curve 188.0 unch.
  
• 10-Year US Treasury Yield 2.21% -2 basis points
  
• Federal Reserve's Balance Sheet $2.861 Trillion -.51%
  
• U.S. Sovereign Debt Credit Default Swap 30.0 -3.22%
  
• Illinois Municipal Debt Credit Default Swap 217.0 +1.79%
  
• Western Europe Sovereign Debt Credit Default Swap Index 269.07 -3.15%
  
• Emerging Markets Sovereign Debt CDS Index 271.24 +.44%
  
• Saudi Sovereign Debt Credit Default Swap 118.35 +.39%
• Iraqi 2028 Government Bonds 84.33 +2.85%
• China Blended Corporate Spread Index 626.0 +16 basis points
  
• 10-Year TIPS Spread 2.34% -3 basis points
  
• TED Spread 40.25 unch.
  
• 3-Month Euribor/OIS Spread 41.25 -3.5 basis points
  
• 3-Month EUR/USD Cross-Currency Basis Swap -50.50 +1.5 basis points
  
• N. America Investment Grade Credit Default Swap Index 92.61 +1.19%
  
• Euro Financial Sector Credit Default Swap Index 220.24 +5.42%
  
• Emerging Markets Credit Default Swap Index 244.74 +2.37%
  
• CMBS Super Senior AAA 10-Year Treasury Spread 162.0 +7 basis points
  
• M1 Money Supply $2.208 Trillion -.88%
  
• Commercial Paper Outstanding 937.50 +.70%
  
• 4-Week Moving Average of Jobless Claims 365,000 +10,000
  
• Continuing Claims Unemployment Rate 2.6% unch.
  
• Average 30-Year Mortgage Rate 3.99% -9 basis points
  
• Weekly Mortgage Applications 663.70 -2.67%
  
• Bloomberg Consumer Comfort -34.7 +.2 point
  
• Weekly Retail Sales +3.40% +10 basis points
  
• Nationwide Gas $3.92/gallon +.03/gallon
  
• U.S. Heating Demand Next 7 Days 27.0% below normal
• Baltic Dry Index 934.0 +2.86%
  
• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 40.0 +6.67%
  
• Rail Freight Carloads 232,401 +2.32%
  

Best Performing Style

• Large-Cap Growth +.93%
  

Worst Performing Style

• Small-Cap Growth -.06%

Leading Sectors

• HMOs +7.69%
  
• Oil Tankers +6.85%
• Networking +2.27%
• REITs +1.67%
• Restaurants +1.61%

Lagging Sectors

• Alt Energy -2.05%
• I-Banking -2.22%
  
• Oil Service -2.93%
• Coal -3.28%
• Education -5.10%

Weekly High-Volume Stock Gainers (8)

• AMLN, PNR, TAST, EPAM, KIOR, RHT, FDO and HII
  

Weekly High-Volume Stock Losers (10)

• TEA, SCOR, LPI, JOSB, MAPP, SNX, AFFY, FINL, MMR and KDN
  

Weekly Charts
ETFs

• High-Volume Gainers
• High-Volume Losers

Stocks

• High-Volume Gainers
• High-Volume Losers
  

*5-Day Change

Stocks Rising into Final Hour on Euro Bounce, Better US Economic Data, Window-Dressing, Investor Performance Angst

Broad Market Tone:

• Advance/Decline Line: Higher
  
• Sector Performance: Most Sectors Rising
  
• Volume: Below Average
  
• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• VIX 15.58 +.65%
  
• ISE Sentiment Index 100.0 -15.25%
  
• Total Put/Call .99 -3.88%
  
• NYSE Arms 1.13 +25.89%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 91.15 -1.82%
  
• European Financial Sector CDS Index 220.25 +1.18%
  
• Western Europe Sovereign Debt CDS Index 268.84 -1.60%
  
• Emerging Market CDS Index 244.62 -.50%
  
• 2-Year Swap Spread 25.0 +.25 basis point
  
• TED Spread 40.25 -1.0 basis point
  
• 3-Month EUR/USD Cross-Currency Basis Swap -50.50 -.5 basis point
  

Economic Gauges:

• 3-Month T-Bill Yield .07% +1 basis point
  
• Yield Curve 188.0 +6 basis points
  
• China Import Iron Ore Spot $147.60/Metric Tonne -.07%
  
• Citi US Economic Surprise Index 18.90 -.7 point
  
• 10-Year TIPS Spread 2.34 +3 basis points
  

Overseas Futures:

• Nikkei Futures: Indicating a +102 open in Japan
• DAX Futures: Indicating a +21 open in Germany

Portfolio:

• Slightly Higher: On gains in my Biotech and Medical sector longs
  
• Disclosed Trades: Covered all of my (IWM)/(QQQ) hedges and some of my (EEM) short, then added them back
  
• Market Exposure: 75% Net Long

BOTTOM LINE: Today's overall market action is mildly bullish, as the S&P 500 trades near session highs on some better US economic data, more financial sector optimism, a bounce in the euro, short-covering, investor performance angst and window-dressing. On the positive side, Oil Service, Ag, Semi, HMO and REIT shares are especially strong, rising more than +1.0%. Financials have traded well throughout the day. Copper is gaining +.84%. The 10Y Yld is rising +6 bps to 2.22%. Major Asian indices were mostly higher, led by a +2.0% gain in India. The Shanghai Composite bounced +.47%, but is down -3.7% over the last 5 days and has cuts its gains for the year to +2.9%. As well, China’s ChiNext Index of smaller growth-oriented companies fell another -.8% overnight and is down -8.1% this week. Major European indices are rising around +.75%, led by a +1.3% gain in France. Spanish shares are bouncing +1.2% today, but are down -3.3% this week and -6.5% ytd, which remains a large red flag for the region. The Bloomberg European Financial Services/Bank Index is rising +1.0% today. The Germany sovereign cds is down -3.3% to 73.66 bps, the France sovereign cds is down -2.2% to 169.41 bps, the Portugal sovereign cds is down -2.0% to 1,073.11 bps and the UK sovereign cds is down -2.5% to 62.83 bps. On the negative side, Homebuilding, Airline, Education and Coal shares are under pressure, falling more than -.75%. Gold is rising +.5%, the UBS-Bloomberg Ag Spot Index is jumping +3.1% and Lumber is falling -1.3%. The Italy sovereign cds is gaining +1.3% to 396.51 bps and the Japan sovereign cds is up +.91% to 99.48 bps. The Philly Fed ADS Real-Time Business Conditions Index continues to trend lower from its late-December peak despite investor perceptions that the US economy is accelerating. Moreover, the Citi US Economic Surprise Index has fallen back to early-Nov. levels. Lumber is -9.0% since its Dec. 29th high despite the better US economic data, dovish Fed commentary, improving sentiment towards homebuilders, equity rally and decline in eurozone debt angst. Moreover, the weekly MBA Home Purchase Applications Index has been around the same level since May 2010. The Baltic Dry Index has plunged around -60.0% from its Oct. 14th high and is now down around -45.0% ytd. China Iron Ore Spot has plunged -18.5% since Sept. 7th of last year. Shanghai Copper Inventories are right near a new record and have risen +741.0% ytd. I still think this is more of a red flag for falling demand rather than the intentional hoarding, which many suggest. US stocks continue to trade very well as every small dip is still seen as a buying opportunity and almost all negatives are ignored. Investor complacency is fairly high again given the recent deterioration in the macro backdrop. Some market leaders, such as my (AAPL) long, are beginning to roll over a bit. Volume is especially light for a quarter-end. I would like to see the market prove itself after quarter-end before becoming more aggressive on the long-side. For the recent equity advance to regain traction, I would still expect to see further European credit gauge improvement, a further subsiding of hard-landing fears in key emerging markets, a rising 10-year yield, better volume, stable-to-lower energy prices and higher-quality stock market leadership. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, more financial sector optimism, a bounce in the euro, some better US economic data, window-dressing and investor performance angst.

Today's Headlines

Bloomberg:

• Rajoy to Unveil Deepest Spanish Budget Cuts in 30 Years. Prime Minister Mariano Rajoy will unveil the most austere budget since before Spain’s return to democracy in 1978, risking a deeper recession in a bid to avoid succumbing to Europe’s debt crisis. “There’s interest in seeing how they are going to manage this particular trick of cutting the budget so aggressively,” said Harvinder Sian, an interest-rate strategist at Royal Bank of Scotland Group Plc in London, during a telephone interview. “The recession will be dramatic.”
  
• Italy Losing Luster as Strikes Tarnish Debt Rally. The Italian bond surge delivering better returns than oil, silver or the dollar this year will fade as the nation seeks to borrow 100 billion euros ($136.7 billion) in the second quarter against a backdrop of strikes. Italian securities due in a year or more have outperformed commodities, currencies and other sovereign debt in 2012, when adjusted for volatility, as budget cuts by Prime Minister Mario Monti and European Central Bank lending spurred demand for the nation’s assets.
• Euro Spat Erupts as Fekter Upstages Juncker at Crisis Talks. A euro-area finance ministers’ meeting to bolster Europe’s crisis-fighting efforts was thrown into confusion as a spat between Luxembourg and Austria erupted over who got to brief journalists first on the outcome. Jean-Claude Juncker, 57, who chairs the meetings, abruptly cancelled a press conference in Copenhagen today after Austria’s Maria Fekter stole the Luxembourg prime minister’s thunder and signalled to reporters that the group had limited new bailout lending to 500 billion euros ($667 billion). “There was no point in having a press conference, because the Austrian finance minister announced it,” Juncker told reporters as he hustled into an elevator after the meeting. “I’m against babbling, so I wanted to make a point today,” he said in an interview later in the day. Fekter, 56, apologized.
• Corporate Bond Risk Falls in Europe, Credit-Default Swaps Show. The cost of insuring against default on European corporate debt fell, according to traders of credit-default swaps. Contracts on the Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings dropped 15 basis points to 604, according to JPMorgan Chase & Co. at 8 a.m. in London. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings was down 2.5 at 124 basis points. The Markit iTraxx Financial Index linked to senior debt of 25 banks and insurers declined four basis points to 214 and the subordinated gauge was six lower at 348.
• Sino-Forest to File for Bankruptcy Protection. Sino-Forest Corp. (TRE), the Chinese timber grower accused of fraud by short seller Carson Block, said it plans either a sale of the company or a restructuring under which noteholders would acquire substantially all of its assets.
• Global Payments(GPN) Trades Halted as Industry Probes Data Breach. Global Payments Inc., the electronic-transaction processor, had trading halted as the credit-card industry investigated a data breach that affected firms including MasterCard (MA) Inc. Global Payments fell 9.1 percent to $47.50 when trading was halted in New York, after earlier plunging more than 13 percent. The Wall Street Journal reported that the Atlanta-based firm was hit by a security breach that may have put 50,000 cardholders at risk. MasterCard fell 0.6 percent to $425.47 at 1:19 p.m. Visa Inc. (V) fell 0.5 percent to $118.45.
• Obama Campus Fervor Losing to Apathy as Students Sour on 2012. Now a senior, Cassidy, 21, said she’s not working on a campaign this time around. She’s too busy looking for a job at a nonprofit advocacy group. She and her friends aren’t discussing the election as much as in 2008, she said. “There is not much talk of Obama at all,” Cassidy said of the mood on campus, which extends beyond the president. “I don’t think anyone’s satisfied.”
• Consumers in U.S. Boost Spending. Purchases climbed 0.8 percent in February, Commerce Department figures showed today in Washington, exceeding the 0.6 percent median gain forecast in a Bloomberg News survey of economists. The Thomson Reuters/University of Michigan’s final index of consumer sentiment rose to 76.2, the highest since February 2011, from 75.3 last month.
• Business Activity in U.S. Falls Slightly in February. Business activity in the U.S. held near a 10-month high in March, showing the economy is weathering rising fuel costs. The Institute for Supply Management-Chicago Inc. said today its barometer fell to 62.2 from 64 in February. Readings greater than 50 signal growth. Economists forecast the gauge would fall to 63, according to the median of 58 estimates in a Bloomberg News survey.
• Scana Receives NRC Approval to Build South Carolina Reactors. Scana Corp. (SCG) won U.S. approval to build nuclear reactors, the second construction permit issued by regulators in more than 30 years for units that may be among the nation’s last erected this decade. The U.S. Nuclear Regulatory Commission today voted 4-1 to approve the Cayce, South Carolina, company’s plan to construct and operate two units at its Virgil C. Summer plant, about 26 miles (42 kilometers) northwest of Columbia. Chairman Gregory Jaczko dissented, citing pending safety rules in response to Fukushima Dai-Ichi disaster in Japan.
• Copper Traders Turn Most Bearish in Two Months on China: Commodities. Copper traders are the most bearish in two months after stockpiles tracked by the biggest metals bourse rose for the first time in five weeks and Goldman Sachs Group Inc. cut its recommendation on commodities to neutral. Eleven of 25 analysts surveyed by Bloomberg expect copper to drop next week, the highest proportion since Jan. 6. Seven were neutral. Inventories reported by the London Metal Exchange rose 1.4 percent on March 27, the first gain since Feb. 22. They retreated the following two days and rose again today. Reserves in Shanghai’s bonded warehouses tripled since November and any strengthening in demand next quarter may be “tepid,” Barclays Capital said in a report March 28.
• Corn, Wheat, Soybeans Surge, Renewing Food-Inflation Concerns. Corn prices surged the most in 21 months, and wheat and soybean jumped after forecasts by the U.S. Department of Agriculture signaled tighter crop supplies, renewing concerns that food inflation will quicken. Corn inventories on March 1 in the U.S. fell more than analysts forecast to the lowest for this time of year since 2004, the USDA said today in a report. Wheat reserves dropped to a three-year low, and planting intentions trailed estimates. Farmers will sow 73.902 million acres with soybeans this year, down 1.4 percent from 2011, the agency said after surveying farmers.
• French Police Arrest 19 Islamic Radicals, Sarkozy Says. Just over a week after killing a self-declared jihadist who murdered seven people in the Toulouse area, French police arrested 19 people involved in radical Islamist networks across the country. “These arrests are linked to the world of a certain sort of radical Islam,” President Nicolas Sarkozy said in an interview today with Europe1 radio. Kalashnikov automatic weapons were found in the homes of some of those arrested, he said, adding that there may be additional raids across the country.

Wall Street Journal:

• Apple(AAPL) Labor Pact Could Ripple Across China. Manufacturers grappling with rising labor costs and increasing worker demands in China could face further pressure if a critical probe of a major Apple Inc. supplier sets a new standard for China's factory workers.
• Not-So-Smooth Operator. Obama increasingly comes across as devious and dishonest.

CNBC.com:

• Rates Should Rise in 2013; No More Easing: Fed's Lacker.

Business Insider:

• Bin Laden Traveled All Over Pakistan And Had Several Kids Without Being Hassled By The ISI, Says His Wife.

Zero Hedge:

• The Insanity of the Sarkozy Carry-Trade's Contagion Risk in 3 Charts.
• Is Spanish Regional Debt Out Of Control?
• Is The Chinese Stock Market About To Crash?
  

NY Post:

• Next Stop, Grand Central for Goldman(GS) Tell-All. It is going to pay off big time for former Goldman Sachs exec Greg Smith to write about his stint in the belly of the Wall Street beast. Smith scored a mind-boggling $1.5 million advance to chronicle his life and times at the investment bank.

New York Times:

• Large Hedge Funds Fared Well in 2011. Hedge funds have endured a rough year. Tumultuous markets. Tighter regulations. An insider trading crackdown. But despite the lackluster environment, the top managers still took home $14.4 billion in 2011.
• A Bill to Loosen Hedge Fund Marketing. Investors may soon get a keyhole view into the cloistered world of hedge funds and private equity firms, thanks to a little-known provision in a new bill that would relax rules on how investment firms can market themselves to the public. The bill, called the Jump-start Our Business Start-ups Act, or JOBS Act, would reverse parts of a nearly 80-year-old regulation preventing these funds from discussing even the most basic items, like performance or investment strategy, with outsiders. The rule, part of the Securities Act of 1933, gave an already secretive industry the regulatory cover to remain silent. “It’s a dramatic change from where the industry is,” said Tripp Kyle, a partner at the public relations firm Brunswick Group, which works with some of the largest investment firms in the world. “I think it presents a real opportunity for firms to evolve their mind-set from what they can’t do to what they can and perhaps should be doing.”

Gallup:

• Obama Job Approval: 47% Disapprove, 44% Approve. (graph)
  

Reuters:

• BP(BP): U.S. Hiding Evidence on Size of Gulf Oil Spill. BP Plc has accused the U.S. government of withholding evidence that may show the 2010 Gulf of Mexico oil spill was smaller than federal officials claimed, a key issue in determining the oil company's liability. A reduction in the size of the spill would lower the maximum civil fine BP could be forced to pay under the U.S. Clean Water Act, a sum now estimated as high as $17.6 billion.

Telegraph:

• Germany Launches Strategy to Counter ECB Largesse. Germany is preparing a raft of measures to safeguard its financial system and prevent excess stimulus from the European Central Bank leaking into an inflationary credit boom.

Ansa:

• Fiat SpA CEO Sergio Marchionne said that the month of March was "horrible" and that car sales in Italy fell by around 40%.

Bear Radar

Style Underperformer:

• Small-Cap Value +.10%

Sector Underperformers:

• 1) Homebuilders -.94% 2) Coal -.81% 3) Airlines -.73%

Stocks Falling on Unusual Volume:

• IOC, VLO, UAL, BBY, ARLP, FINL, SHPGY, XRTX, TIBX, MAPP, AFFY, GPN, PVR and INVN
  

Stocks With Unusual Put Option Activity:

• 1) LO 2) IVN 3) ETFC 4) RIMM 5) AET
  

Stocks With Most Negative News Mentions:

• 1) KND 2) USB 3) HPY 4) V 5) F
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume
  

Bull Radar

Style Outperformer:

• Mid-Cap Growth +.44%

Sector Outperformers:

• 1) HMOs +1.75% 2) Ag +1.0% 3) Oil Service +.97%

Stocks Rising on Unusual Volume:

• VRNT, IMGN, VVUS, TRIP, ATE, JNY, LPI and CVH
  

• 1) BBBY 2) RIO 3) RAX 4) KSS 5) ETE
  

Stocks With Most Positive News Mentions:

• 1) LNKD 2) VVUS 3) WYN 4) DISCA 5) CSX
  

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume