9 July 2013 AMC

9 July 2013 AMC

Market Summary 

Market Internals

Leaders and Laggards

Technical Updates

Briefing's Commentaries 

BRIEFING.COM
Daily Sector Wrap: Equities Settle on Highs 

The S&P 500 settled higher by 0.7% after seeing steady buying over the course of the session.

Growth-oriented groups paced today's advance even after the International Monetary Fund cut its 2013 global growth outlook to 3.1% from 3.3%. The materials sector gained 1.6% as steelmakers and gold miners outperformed. The Market Vectors Steel ETF (SLX 38.51, +0.56) settled higher by 1.5% while miners displayed strength as gold futures added 0.9% to $1246.30 per ounce.

Also of note, Dow component Alcoa (AA 7.91, -0.01) shed 0.1% after its slim earnings beat was overshadowed by a 1.9% year-over-year decline in revenue. In addition, the aluminum producer reaffirmed its global aluminum demand growth forecast at 7.0%.

The industrial sector also finished among the leaders after FedEx (FDX 103.15, +4.32) rallied 4.4% amid speculation activist investor Bill Ackman may be building a position in the company. FedEx provided significant support to the Dow Jones Transportation Average, which jumped 2.3% as all 20 components posted gains.

Another commodity-related sector, energy, rose 1.1% as crude oil climbed 0.8% to $104.00 per barrel.

Stocks overcame a morning stumble after reports indicated the Federal Deposit Insurance Committee has proposed a dual standard for bank leverage ratios. Under this proposal, large banks would have to satisfy a 6.0% capital requirement while smaller banks would be subject to a ratio of 5.0%. The financial sector briefly dipped into the red before ending with a gain of 0.8%.

Similar to yesterday, the tech sector trailed behind the broader market. Dow component IBM (IBM 191.30, -3.68) pressured the group after Goldman Sachs downgraded the stock to Neutral' from Buy.'

On the downside, the telecom sector shed 0.2%. Meanwhile, other countercyclical groups finished mixed. Consumer staples outperformed (+0.8); utilities (+0.7%) finished in-line with the S&P; and health care (+0.3%) was pressured by disappointing preliminary results from Intuitive Surgical (ISRG 419.30, -80.78).

Tomorrow, the weekly MBA Mortgage Index will be reported at 7:00 ET, May wholesale inventories will cross the wires at 10:00 ET, and the Federal Open Market Committee will release the minutes from its June 19 policy meeting at 14:00 ET.

The U.S. Treasury will auction $21 billion in 10-yr notes.

Commodities

Treasuries

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Jason's Commentaries


Moving the Market
China's hotter-than-expected inflation data suggests PBoC will refrain from system-wide liquidity injections: precious metals rising.

Alcoa (AA) beats EPS estimates; reaffirms global aluminum demand growth forecast at 7%; reports 1.9% year-over-year revenue decline.

Regulators propose dual standard for bank leverage ratios (6% for large banks).




Market decided to make another gain of 75 points ahead of the FOMC minutes, closing at 15300 on the Dow, which is my XOP. Volumes were below average ay 691m shares traded on the NYSE. Internals are showing bullish bias through the session. The main laggard was IBM which  lost -1.83% which dragged the Dow down. Apart from that, we've got Dow components like CSCO, BAC, MS, CAT, GE gaining more than 1%. Materials, industrials and energy were the main leaders of last night bullish day. While ahead of the FOMC minutes, I believe the market is going to do what it did last week to price into the QE taper fears. FOMC minutes will be released at 2pm ET tonight and Ben Bernake will be speaking at 4pm ET. Prepare for some roller coaster ride today.

Market Call: DOWN

Date: 10 Jul 2013