The Closing Look

Stocks were quiet on Monday as investors piled into Apple (AAPL) and several semiconductor stocks.  Apple rallied after a report was released that suggested the tech giant asked its suppliers to prepare 72-78 million units, above the market’s expectation of 65 million units for the iPhone. In other news, two Fed officials spoke on Monday and both were mildly hawkish, hinting at more than one rate hike later this year. Meanwhile, economic data failed to impress. The PMI Manufacturing index came in at 50.5, missing estimates for 51.0.  Yet the Fed is trying to tell us that they are raising rates later this year. The fun continues because Janet Yellen is going to speak on Friday.

Gary’s Thoughts: Remember, it is end of month and a pre-holiday week. Otherwise, indices remain raaaaaaaange-bound!

The Morning Look

Market Update:

Stock futures are lower ahead of Monday’s open as investors digest last week’s sloppy action. In the near term, the S&P 500’s next level of resistance is the 50 day moving average.

Economic Data: Our award winning weekend market report will be out tonight. Just still a lot of range-bound nausea with rolling bear markets and very little in the way of bull markets. New yearly highs? Try finding any!

  • James Bullard Speaks
    5:30 AM ET
  • John C. Williams Speaks
    8:00 AM ET
  • PMI Manufacturing Index Flash
    9:45 AM ET
  • Patrick Harker Speaks
    6:30 PM ET

Highlights:

  • G-7 Warns of Weak Global Growth Outlook
    Gary’s Thoughts: Gee…didn’t we hear things were accelerating last week? Make up your mind!
  • Clock Ticks on Bull Market With No New High for Stocks in a Year
    Gary’s Thoughts: Russell and NYSE trading where they were in 2013.

The Closing Look

On Thursday, stocks opened lower after the latest round of economic and earnings data was released. Before the open, Wal-Mart ($WMT) beat by 10 cents but that came after the retail giant lowered guidance several times in the past year. Economic data was mixed,  jobless claims fell by 16k, to 278, missing estimates for 275k. The Philly Fed Survey fell to negative -1.8, missing estimates for a reading of positive 3. The reading was deeper into negative territory and a big miss.

Gary’s Thoughts: After another nauseating day, late action has the market getting back a decent amount of the day with some notable technical stuff…namely S&P undercutting and finishing at support…namely commodities “feeling” the worst is over…for this second. Revisit us in the next second. We suggest a bounce comes off of this as certain areas already not believing what the Fed had to say. Unfortunately, we continue to be held hostage by a select few ex-tenured professors running the world and its conjured up money!

The Closing Look

On Wednesday, stocks were higher but fell after the Fed released the minutes of its latest meeting. The minutes showed the Fed would entertain a potential June rate hike if economic conditions improved. The USD rallied hard on the news and a slew of commodities fell. Financial stocks were bid higher all day after the bulls showed up and defended the 50 day moving average.

Gary’s Thoughts: The fed is changing with the wind! No comment! Not thrilled!

“RATE HIKES? AND THE KNICKS WILL WIN THE NBA TITLE!”

“RATE HIKES? AND THE KNICKS WILL WIN THE NBA TITLE!”
By Gary Kaltbaum
May 19,2016
Headline: “In a clear message to the market, the Fed says rates may rise again in June.” Say what? Clear message? What clear message? Wasn’t it just a few weeks ago these same people said they were worried about international issues and had to stand pat for now? Didn’t Mrs. Bubble just state that they could print more money if need be? Wasn’t everybody saying they’ll be no more rate hikes this year? So we are now to believe that while around the time they were telling everybody they need to sit on rate hikes, they were also stating the opposite in meetings. Kids…we suggest to you these people would fall over in a 3 MPH wind. They change their tune on every data point, every market move and every change in the wind. They change their words based on what day it is. Clear message? We guarantee you by the time the next meeting comes around, we will hear 50 different thoughts from 10 different Fedheads all contradicting each other and all changing their tune at least once. These are people that are flying by the seat of their pants. These are people that wake up every morning and see the market go down and say one thing and then see the market go up the next day and say another thing. They get one report that looks good and it’s time to hike. They get another report that looks bad and it’s time to sit. Unfortunately, we continue to deal with a bunch of ex-tenured professors that have no understanding of markets or the economy…yet, they have their finger on trillions to try and move markets and the economy. $20 trillion of printed money, 0% rates for 8 years, negative rates and the outright buying of markets….and what have we got…nothing but a massive increase in debt and leverage built up around the globe, enabled by these same people. It is this debt that continues to undermine economies going forward. It is this debt that eventually leads to the comeuppance! Clear message? Who are they trying to kid?

 

We were going to report on this but this covers it all! Wither Venezuela!

SOURCE: http://www.zerohedge.com/news/2016-05-18/venezuelan-police-unleash-tear-gas-rubber-bullets-amid-violent-anti-government-prote

The Morning Look

Market Update:
Futures are lower ahead of Thursday’s open as investors digest another volatile week on Wall Street. Stocks were up big on Monday, down big on Tuesday, then were up most of Wednesday before turning lower after the Fed minutes were released. Lots of areas of the market are beginning to roll over and any further selling will signal real trouble for the market. And airplane crash (most likely terrorism) does not help.

Gary’s Thoughts:

  • Jobless Claims 8:30 AM ET
  • Philadelphia Fed Business Outlook Survey 8:30 AM ET
  • Chicago Fed National Activity Index 8:30 AM ET
  • Bloomberg Consumer Comfort Index 9:45 AM ET
  • Leading Indicators 10:00 AM ET
  • EIA Natural Gas Report 10:30 AM ET
  • William Dudley Speaks 10:30 AM ET
  • Fed Balance Sheet 4:30 PM ET
  • Money Supply 4:30 PM ET

Highlights:

  • The US dollar rallied after the Fed minutes left the door open for a June hike
    Gary’s Thoughts: Enough on the Fed this morning.
  • Wells Fargo Cuts Target on Valeant Citing Potentially ‘Brazen’ Executive Pay Packages
    Gary’s Thoughts: Valeant a criminal operation.

The Morning Look

Market Update:
Futures are lower ahead of Wednesday’s open as investors pause to digest Monday’s strong rally and Tuesday’s steep decline. Lots of areas of the market are beginning to roll over and any further selling will signal real trouble for the market.

Gary’s Thoughts: Nothing thrilling to talk about this morning and now another retailer (Target) coughs one up.

  • MBA Mortgage Applications 7:00 AM ET
  • Atlanta Fed Business Inflation Expectations 10:00 AM ET
  • EIA Petroleum Status Report 10:30 AM ET
  • FOMC Minutes 2:00 PM ET

Highlights:

  • LendingClub Tumbles After Investors Suspend Debt Purchases
    Gary’s Thoughts: Party over. We have been skeptical of these types of companies for a couple of years.
  • Bill Clinton Says He’s Asked for Role in Wife’s Administration
    Gary’s Thoughts: Go away!

The Closing Look

Stocks ended lower on Tuesday as investors continue to digest the latest round of economic and earnings data. On the economic front, the consumer price index (CPI) rose to 0.4%, beating estimates for 0.3%. That was the highest increase since 2013 and was the first real sign that inflation may be increasing. If inflation accelerates from here, that may put pressure on the Fed to raise rates at some distant point in the future. A separate report showed that housing starts picked up at a moderate pace in April and rose to 1.172M, beating estimates for 1.135M. Meanwhile, earnings failed to impress as Home Depot (HD) fell after reporting Q1 results.

Gary’s Thoughts: Ick! Not sure it is good news when market bounces back and forth 200 points each day. Not a good day technically. Even the Transports, which were up 160, finished only up in the 40s. And do not believe any noise about good economy. And really do not believe a fedhead coming out saying they will raise rates 3 times this year. No chance.

The Closing Look

Stocks rallied nicely on Monday as investors showed up and defended key levels of support (50 DMA line) for the Dow Jones Industrial Average, the S&P 500 and several other important sectors. Overnight, China said industrial production, retail sales and investment data all missed estimates. China also said that measures of money creation and credit growth also came in below estimates. Separately, in his quarterly filings, Warren Buffet said he bought $1 billion of Apple (average price $102) in Q1 2015.

Gary’s Thoughts: Good up day after a bad down day. Seems we are getting a lot of this. But still running in place with a decent amount of areas that had just broken support.