The Morning Look

Stock Market Overview: 

Futures are higher ahead of Friday’s open as investors digest a busy week of central bank meetings. The big take-away is that nearly every major central bank in the world remains committed to their easy money stance.

Gary’s Thoughts:  Bad news being bought! (CAT) Good news being bought big! (FDX) We will leave it at that as in a nutshell, it describes what we are seeing. Don’t argue. We will have our usual award winning weekend report Sunday. 

Economic Data:

  • William Dudley Speaks 9:00 AM ET
  • Consumer Sentiment 10:00 AM ET
  • Atlanta Fed Business Inflation Expectations 10:00 AM ET
  • Eric Rosengren Speaks 11:00 AM ET
  • Baker-Hughes Rig Count 1:00 PM ET
  • James Bullard Speaks 3:00 PM ET

Highlights Of The Day:

  • Dow Industrial Average Turned Positive For 2016
    Gary’s Thoughts: Don’t blink!

The Closing Look

The Dow Jones Industrial Average and S&P 500 turned positive for the year as investors digested a slew of economic data. The biotechs continued to lag while the beaten down areas of the market continued to do well. The Transports ($IYT), Materials ($XLB), Gold ($GLD/$GDX), Silver ($SLV), Steel ($XLS), Emerging Markets ($EEM) all rallied sharply and hit fresh multi- month highs.

Gary’s Thoughts: And now industrials, conglomerates, rails and “stuff” start moving above resistance. Shorts drinking a lot of tequila!

The Morning Look

Stock Market Overview: 

Futures are lower ahead of Thursday’s open as markets digest the Fed meeting and the recent and strong rally we have seen in global markets.

Gary’s Thoughts: Massive overhead resistance in the offing!

Economic Data:

  • Jobless Claims 8:30 AM ET
  • Philadelphia Fed Business Outlook Survey 8:30 AM ET
  • Current Account 8:30 AM ET
  • Bloomberg Consumer Comfort Index 9:45 AM ET
  • JOLTS 10:00 AM ET
  • Leading Indicators 10:00 AM ET
  • EIA Natural Gas Report 10:30 AM ET
  • Fed Balance Sheet 4:30 PM ET
  • Money Supply 4:30 PM ET

Highlights Of The Day:

  •  
  • US Dollar falls after Fed meeting
    Gary’s Thoughts: Fed blinks, eases…dollar drops…and yes, the fed eased!

THE CENTRAL BANK PARTY GOES INTO OVERDRIVE

CENTRAL BANK PARTY GOES INTO OVERDRIVE”

By Gary Kaltbaum
3/17/2016
garyk.com
@GaryKaltbaum
Fox News Business Contributor
Greetings all. Today we are headed to China for 2 weeks…a little bit of business and a lot of touring. We will check back in with you from time to time to tell you what we are seeing. But first, a few thoughts!
The following is a fair assessment of what central banks around the globe are doing. We left out Albania!
Since the low that we called on Feb 11-12:
Europe announced an extension and a raise of printed money to 1 trillion/year. On top of that, they are now going to buy up corporates and left room to start buying up equity markets. Negative rates continue to go more negative.
China just keeps on printing…keeps going into more debt… and continues to unabashedly (big word) announce that they are buying up their markets on any weakness. All this even though they are still growing 6.5-7%!???
Japan is printing to the tune of 700 billion/year…and yes, negative rates. They have also announced the buying up of their markets on any weakness.
Negative rates continue to go more negative in many areas. Our faulty abacus tells us there is approximately $10 trillion working with negative rates.
Where there isn’t negative rates, 0% rates pervade.
Sweden prints. UK prints. We lost count on who is printing.
.
And now, Yellen eases. Yes…after a whopping tightening of a whopping 1/4%, Yellen now backs off doing anything. Oh…we know there is some implied bs about 2 rate hikes but the Knicks will get into the playoffs before another rate hike.
What one must understand is these geniuses are not even pretending any more to care about economies. The fact is…THEY CARE ONLY ABOUT MARKETS. It is the down markets that pull the curtains up on all the massive debt incurred. It is the down markets that cause them angst. It is the down markets that scares the crap out of them.  You must remember that Lehman, Bear, Wamu, Wachovia and the rest did not go out of business. The markets put them out of business. So…DEFEND THE MARKETS AT ALL COSTS!
The recovery rally that started Feb 11-12 continued into yesterday. We have written to you about the improvement. We have told you about the “turning of the corner” of all the commodity areas that were a huge anchor for the better part of 18 months. Commodities are rallying for 2 reasons: first, they have been down huge. Eventually, 50-90% drops find lows. Second, our dollar is now breaking down. Dollar down…commodities up.
We now enter massive overhead resistance in the market where the real test occurs. Keep in mind, markets that go up in the face of declining sales and earnings are eventually, not a good thing. But a weak dollar can help that out.
Lastly, one of the outcomes of the “fed fakeout” is that gold continues to rally. Looks like it is breaking out of a very bullish pattern here. Stay tuned.

The Closing Look

At 2pm, the Fed decided to leave rates steady and market participants lowered the odds to two rate hikes this year.

Gary’s Thoughts: Make that NO rate hikes this year. Europe adds printing, China adds printing. Japan adds printing. Countries are buying up stock markets and all that has happened is the market is recovering some. Tomorrow another day GOLD and GDX now look ready for the move out as dollar was slaughtered as the Fed blah blah easy money.

The Morning Look

Stock futures are relatively quiet as the world waits for the Fed meeting and press conference later today.

Gary’s Thoughts: Into the fed, just watch oils and financials. Both have set-ups to break out of. If they can go topside, there will be more upside. Remember, Japan printing 700 bil/year…Europe 1 trillion, China…over 1 tril, uk, sweden and of course, some of these places are buying up their markets. You figure it out!

Economic Data:

  • MBA Mortgage Applications 7:00 AM ET
  • Consumer Price Index 8:30 AM ET
  • Housing Starts 8:30 AM ET
  • Industrial Production 9:15 AM ET
  • EIA Petroleum Status Report 10:30 AM ET
  • FOMC Meeting Announcement 2:00 PM ET
  • FOMC Forecasts 2:00 PM ET
  • Fed Chair Press Conference 2:30 PM ET

Highlights:

 

The Closing Look

Stocks were relatively quiet on Tuesday after the Bank of Japan did nothing at their latest meeting but did say they are ready to add more stimulus if needed. In the U.S., the producer price index fell -0.2%, matching estimates for -0.2%. Meanwhile, retail sales slid by -0.1%, also matching estimates. The Empire State Manufacturing report rose by 0.62, beating the Street’s estimates for -11.25. The Redbook, which measures weekly same store sales, rose 0.6%, lower than last week’s reading of 0.7%. The housing market index, which measures demand for new homes, came in at 58, missing estimates for 59. Business inventories came in at 0.1%, higher than the Street’s estimate for unchanged. Wednesday is Fed day.
Gary’s Thoughts: Fed tomorrow. We put them just behind broccoli and cauliflower as favorite things! (we hate both) They will not raise rates and they will tell us when information comes in, they will let us know. Seriously! That is what they will tell us! Trump wins Florida big. (Rubio should bow out but wont!) Kasich/ Trump in Ohio will be close! If Trump wins Ohio, get the fork! Republican establishment on their fifth bottle of vodka!

A SHORT NOTE ON BIOTECH

Biotech continues to lag this recent rally and badly. We noted this in the past week. We are not sure if it is meaningful to the markets but to quote ourselves from yesterday’s radio show: “If they cannot rally while the market is going up, then when the market goes down, they will lead down!”

Today, we are seeing a few breaks to the downside out of what we call “inverse flag” patterns. These patterns are basically the worst of all patterns as it shows that even after a cliff dive, there is no buying to be had.

We will leave it at that. Price and volume are speaking loud and clear in what was the strongest risk area during the bull market.

The Closing Look

Stocks were mixed to mostly higher on Monday as the market continues to grind higher ahead of Wednesday’s Fed meeting. Overnight, China said industrial output was the weakest since 2009, but the Shanghai index still rallied close to 2%. The rally in Chinese stocks came after the new head securities regulator made it clear that he will keep boosting their equity market. 

Gary’s Thoughts: Waaay overbought but still no selling. Waaay overdue and next up is Yellen! Markets love easy money but beware markets rallying into lower earnings. Massive resistance ahead.

The Morning Look

Stock Market Overview: 

Futures are lower ahead of Tuesday’s open as markets digest the Bank of Japan (BOJ) decision to keep monetary policy unchanged and wait for the Fed to conclude its latest meeting on Wednesday.

Gary’s Thoughts: We came into the week thinking commodities could pull back and things need to slow down as we are waaaay overbought and into resistance. Tomorrow, we get Mrs. Bubble! We suspect they do nothing and say blah blah blah.

Economic Data:

  • 4-Week Bill Announcement 11:00 AM ET
  • 3-Month Bill Auction 11:30 AM ET
  • 6-Month Bill Auction 11:30 AM ET

Highlights Of The Day:

  • Merkel Stands by Stance on Refugees After Losses in State Polls
    Gary’s Thoughts: We think Merkel could be in trouble.
  • Russia Says Iran May Join Oil Freeze After Boosting Output
    Gary’s Thoughts: Loweer oil has killed them. We are surprised they havent tried more to keep oil prices from going down.