Need to Know
JUNE 28, 2013
6 gut checks before the stock market's opening bell
By Shawn Langlois
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Shutterstock
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Good morning.
Jeff Gundlach and Bill Gross did their best this week to calm the bond-market jitters that have freaked-out investors fleeing in droves. Some $8.6 billion was pulled from U.S. bond funds last week, taking the four-week outflow to $23.7 billion, the worst month of withdrawals since October 2008, according to Lipper. We'll see whether the mea culpas, naval metaphors and reassuring words from rich guys with vested interests are enough to turn that around.
The fund flow direction isn't any more positive for emerging-market bond funds either, where cash poured out last week at a record pace .
For now, the smarter money is in commodities. No, really. Not gold or silver, obviously. But the $12 billion hog-futures market, where "everybody's happy and making money and having fun." Who can blame them? Hog prices have surged 19% this year compared with a 10% drop on the Dow Jones-UBS Commodity Index.
U.S. stocks not named BlackBerry aren't looking so bad either. Blue chips just turned in their best three-day streak this year and more gains are on tap this morning. It'd take a big drop to keep stocks from ending higher for the second quarter and to get in the way of the Dow notching its best first half of the year since 1999.
Key market gauges: The Nikkei exploded for a 3.5% rally, making the mere 1%-plus gains across other major Asian indexes look paltry by comparison. A batch of upbeat Japanese economic data provided a tailwind. Markets aren't as perky in Europe , where the buyers began to veer away as the session pushed on. The month looks like a slam dunk to finish lower.
In the U.S. markets, the rally looks like it will continue, at least in the early going. Futures on the Dow and the S&P are both moving nicely higher. Crude oil is heading toward its first monthly gain since back in March while gold is in the familiar position of weakness .
The economy: Four Fed speakers will be talking today, with Jeremy Stein perhaps the most interesting, seeing as he was one of the first Fed officials to discuss overheating in credit markets. On the data front, the Chicago PMI and the University of Michigan/Thomson Reuters consumer sentiment reports hit at 9:45 a.m. Eastern and 9:55 a.m., respectively. Unless, of course, you paid a premium to get that data earlier than everyone else. Read: Spotlight on the economy .
The buzz: Ouch. BlackBerry shares are getting beaten to a pulp in premarket trading after the handheld device maker disappointed with its quarterly results . Meanwhile, longs are scrambling to find a silver lining. Something.
Looking forward to hearing someone argue that this Blackberry earnings miss is somehow bullish for the overall market $BBRY
— Steven Harris (@HarrisStevenJ) June 28, 2013
Molycorp is seeing a big surge in attention this morning on StockTwits. The stock closed higher yesterday and is up another 11% premarket on word the SEC has closed its investigation into the rare-earth miner's public disclosures. No action recommended; let the buying/squeezing begin.
Other top-trending tickers include Micron , WellPoint and, of course, Apple , which was hit with another lowered price target in yesterday's session. Also keep an eye on Yelp , after the online review site pulled back from the record high it notched in the prior session.
The chart of the day: Tim Knight draws an apt comparison between Britney Spears and the market shift we saw on May 22, when Bernanke began that taper talk. From a steady, reliable, cute-Britney market to a much more volatile, bald-Britney version, one Knight says he much prefers. His conclusion? "May 22 is probably the top." Read his whole post on the Slope of Hope blog , including his take on Apple's boss: "Tim Cook is just another rich, boring executive at another rich, boring company."
Jeff Gundlach and Bill Gross did their best this week to calm the bond-market jitters that have freaked-out investors fleeing in droves. Some $8.6 billion was pulled from U.S. bond funds last week, taking the four-week outflow to $23.7 billion, the worst month of withdrawals since October 2008, according to Lipper. We'll see whether the mea culpas, naval metaphors and reassuring words from rich guys with vested interests are enough to turn that around.
The fund flow direction isn't any more positive for emerging-market bond funds either, where cash poured out last week at a record pace .
For now, the smarter money is in commodities. No, really. Not gold or silver, obviously. But the $12 billion hog-futures market, where "everybody's happy and making money and having fun." Who can blame them? Hog prices have surged 19% this year compared with a 10% drop on the Dow Jones-UBS Commodity Index.
U.S. stocks not named BlackBerry aren't looking so bad either. Blue chips just turned in their best three-day streak this year and more gains are on tap this morning. It'd take a big drop to keep stocks from ending higher for the second quarter and to get in the way of the Dow notching its best first half of the year since 1999.
Key market gauges: The Nikkei exploded for a 3.5% rally, making the mere 1%-plus gains across other major Asian indexes look paltry by comparison. A batch of upbeat Japanese economic data provided a tailwind. Markets aren't as perky in Europe , where the buyers began to veer away as the session pushed on. The month looks like a slam dunk to finish lower.
In the U.S. markets, the rally looks like it will continue, at least in the early going. Futures on the Dow and the S&P are both moving nicely higher. Crude oil is heading toward its first monthly gain since back in March while gold is in the familiar position of weakness .
The economy: Four Fed speakers will be talking today, with Jeremy Stein perhaps the most interesting, seeing as he was one of the first Fed officials to discuss overheating in credit markets. On the data front, the Chicago PMI and the University of Michigan/Thomson Reuters consumer sentiment reports hit at 9:45 a.m. Eastern and 9:55 a.m., respectively. Unless, of course, you paid a premium to get that data earlier than everyone else. Read: Spotlight on the economy .
The buzz: Ouch. BlackBerry shares are getting beaten to a pulp in premarket trading after the handheld device maker disappointed with its quarterly results . Meanwhile, longs are scrambling to find a silver lining. Something.
Looking forward to hearing someone argue that this Blackberry earnings miss is somehow bullish for the overall market $BBRY
— Steven Harris (@HarrisStevenJ) June 28, 2013
Molycorp is seeing a big surge in attention this morning on StockTwits. The stock closed higher yesterday and is up another 11% premarket on word the SEC has closed its investigation into the rare-earth miner's public disclosures. No action recommended; let the buying/squeezing begin.
Other top-trending tickers include Micron , WellPoint and, of course, Apple , which was hit with another lowered price target in yesterday's session. Also keep an eye on Yelp , after the online review site pulled back from the record high it notched in the prior session.
The chart of the day: Tim Knight draws an apt comparison between Britney Spears and the market shift we saw on May 22, when Bernanke began that taper talk. From a steady, reliable, cute-Britney market to a much more volatile, bald-Britney version, one Knight says he much prefers. His conclusion? "May 22 is probably the top." Read his whole post on the Slope of Hope blog , including his take on Apple's boss: "Tim Cook is just another rich, boring executive at another rich, boring company."
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Slope of Hope
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The call of the
day:Dennis Gartman, editor of "The
Gartman Letter" , told CNBC this morning that the gold decline
has probably stabilized, and that he recommends going to the sideline rather
than buying. Also, in a switch from his "agnostic" stance, he said
stocks are positioned to go "a great deal higher." The economy
has some problems, he acknowledged, but he also said he's impressed with how
the stock market was able to shrug off the GDP report. Earlier this week, he talked
about how it's the first time he's "actually stepped up to own
stock indices outright long."
Random reads: Jimmy Wales, Wikipedia's co-founder and jet-setting Londoner, is not an Internet billionaire . Sean Parker IS an Internet billionaire, and he's "setting the record straight" with a wordy defense of his wedding .
Kate expectations -- smart money is on a ginger girl named Alexandra .
Best not kiss the local girls in Turkey.
The human body visualized through "the connections and inter-weaving awesomeness of the London tube system ."
Here's a glimpse of Google's future London HQ .
Need to Know starts early and is updated as needed until the opening bell, but sign up here to get it delivered once to your e-mail box. Be sure to check the Need to Know item. The e-mailed version will be sent out at approximately 8:45 a.m. Eastern. Follow @slangwise on Twitter.
Random reads: Jimmy Wales, Wikipedia's co-founder and jet-setting Londoner, is not an Internet billionaire . Sean Parker IS an Internet billionaire, and he's "setting the record straight" with a wordy defense of his wedding .
Kate expectations -- smart money is on a ginger girl named Alexandra .
Best not kiss the local girls in Turkey.
The human body visualized through "the connections and inter-weaving awesomeness of the London tube system ."
Here's a glimpse of Google's future London HQ .
Need to Know starts early and is updated as needed until the opening bell, but sign up here to get it delivered once to your e-mail box. Be sure to check the Need to Know item. The e-mailed version will be sent out at approximately 8:45 a.m. Eastern. Follow @slangwise on Twitter.
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