13 Feb 2013 AMC

13 Feb 2013

Market Summary 

Market Internals

Leaders and Laggards

Technical Updates

Briefing's Commentaries 

Stock Market Update 16:25 ET Dow -35.79 at 13982.91, Nasdaq +10.39 at 3196.88, S&P +0.90 at 1520.33 : [BRIEFING.COM] The major averages finished today's session on a mixed note despite this morning's strength. The Dow slipped 0.3%, while the S&P 500 and Nasdaq eked out gains of 0.1% and 0.3% respectively. The S&P 500 began the day on an upbeat note amid strength in industrials and discretionary shares. The two sectors outperformed after Comcast (CMCSA 40.13, +1.16) reported strong earnings and announced the acquisition of General Electric's(GE 23.39, +0.81) 49% stake in NBCUniversal. General Electric gained 3.6%, and settled near its highs while Comcast added 3.0% after being up as much as 7.6% in early trade. General Electric contributed to the relative strength of the industrial sector, which ended as the top performer. Elsewhere in the space, 3D Systems (DDD 65.61, +2.54) advanced 4.0% after President Obama spoke positively about the three-dimensional printing industry during last night's State of the Union address. President Obama also called for an increase of the federal minimum wage to $9/hour. This proposal weighed on restaurant operators where many workers earn minimum wage. McDonald's (MCD 94.00, -1.10) lost 1.2% and other quick service restaurants lagged as well. Buffalo Wild Wings (BWLD 76.55, -4.52) fell 5.6% after missing on the bottom line. In addition, the company is expected to face a difficult year with high wing costs responsible for the cautious outlook. The weakness among restaurant stocks weighed on the discretionary sector and negated some of the strength provided by the shares of Comcast. Afternoon trade saw underperformance from financials after several sector components notched fresh multi-year highs yesterday. Bank of America (BAC 12.17, -0.07) and Citigroup (C 44.00, -0.35) led the space during yesterday's action, but ended today's session with respective losses of 0.6% and 0.8%. The CBOE Volatility Index (VIX 12.98, +0.34) climbed throughout the session, but slipped off its highs into the close. Meanwhile, the VIX term structure saw the biggest rise in May and June futures contracts. Volume remained below average, but today's total of 657 million shares represented the most active session so far this week. Treasury yields crept higher following today's 10-yr auction which priced at 2.046%, its highest since March 2012. The bid-to-cover ratio came in at 2.68, which was below the 12-auction average of 2.99. Although demand from indirect bidders lagged, primary dealers ended up with nearly 48% of today's supply. The 10-yr settled at 2.023%, its highest level in 10 months. Overseas, the Bank of England raised its inflation forecast. However, Governor Mervyn King said the central bank will not hike interest rates in response as doing so would risk derailing a "slow but sustained" recovery. Mr. King's comments were followed by reports which indicated some European Central Bank officials are worried the recent strength of the euro will hamper the recovery in crisis states. These reports were met with a quick rebuttal from Germany's Finance Minister Wolfgang Schaeuble who said another major crisis could develop if countries continue to flood the world with money. Currency-related comments are likely to continue through the weekend with the G20 summit set to begin on Friday. Today's economic news had little trading impact. December business inventories rose 0.1%, which was slightly lower than the 0.3% rise expected by the Briefing.com consensus. Elsewhere, January retail sales climbed 0.1%, in-line with expectations. Though retail sales met expectations, this report is likely to be watched in the coming months in order to assess the impact of the expiration of the payroll tax cut as well as higher tax rates for top earners. In other news, export prices, excluding agriculture, increased by 0.5% in January after they had decreased by 0.2% during the prior month. Excluding oil, import prices increased by 0.2%, which followed the 0.1% decrease experienced in the prior month. Tomorrow's economic data will be limited to weekly initial and continuing claims. This report will be released at 8:30 ET. General Motors (GM 28.67, +0.12) and PepsiCo(PEP 71.50, -0.67) are among the notable names scheduled to report their quarterly results prior to the open. The U.S. Treasury will auction off $16 billion in 30-yr bonds. ..NYSE Adv/Dec 1765/1251. ..NASDAQ Adv/Dec 1347/1095.

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Jason's Commentaries

The market was flat again yesterday... all 3 indices broke down after market open but closed back with some gains by the market close.  While looking at the internals, we're having an equal fight between the bulls and the bears with the volumes at 636m shares traded on the NYSE. All of the 9 sectors are ranging below 1%, with not much leadership within the sector. While on the technical note, we're ranged bounded, awaiting for some catalyst to get the market to breakout. Looking at the incoming news,  we have only the unemployment claims coming out at 830am ET, which is unlikely to move the market much unless there is some big difference between the expected and actual. Else, we'll be expecting a very flat session for valentine's day. Don't forget there's a Valentine's Day rally... 

Market Call: FLAT to upside

Date: 14 Jan 2013