Posts Tagged ‘ADP’

Notes From Underground: When I Have Something to Say Sir, I’M GOING TO SAY IT NOW (Phil Ochs)

February 3, 2016

The markets are in turmoil and it gets the mind to thinking: What could possibly have caused today’s reversal in the stock market and the long end of the BOND MARKET? The market seemed like it was on the edge of a complete risk capitulation. The dollar was dropping, bonds all over the world were in rally mode and the precious metals were finally finding some technical strength as the GOLD (in pure dollar terms) had finally rallied through its 200-day moving average. Even the SILVER was able to synchronize with the GOLD and break out of three months of resistance. (The silver 200-day is at 15.13, still a bit above its closing price.) The global stock markets were cascading lower as the Nikkei and German DAX took out their lows made the night of the BOJ’s surprise move to a three-tiered negative interest rate policy.


Notes From Underground: Is Charlie Evans a Lonesome Dove?

January 8, 2015

Tomorrow is the release of the U.S. and Canadian Employment reports, which are usually days of increased market volatility. Usually, Notes From Underground provide some insight into possible market movement based on attaining a sense of investor consensus and putting that into perspective based on relevant indicators and pre-release price action across a wide variety of variables.


Notes From Underground: The Unemployment Report Table Is Set, Will You Be On The Menu?

July 2, 2014

Today’s release of the ADP report caused the market to react in highly predictable fashion. ADP data predicts a nonfarm payroll in the high 200,000 and as to be expected the BOND FUTURES were sold on the positive outlook, resulting in a STEEPENING in the 2/10 yield curve, a rally in the U.S. DOLLAR and leaving yesterday’s SPOOS rally intact. The only non-correlative trade was the precious metals and copper as both sets of ELEMENTS rallied, defying the implications of potential higher interest rates. Tomorrow will be important in seeing how the market reacts to the jobs data. BE PATIENT. Here’s why:


Notes From Underground: The FED Sends Out A “May Day” (DOT, DOT, DOT)

May 1, 2014

Today is May Day and European markets were closed in an effort to celebrate labor over kapital. Financial markets celebrate the international markets with pageantry but not with higher wages. Yesterday, the Fed released its interest rate decision and as expected there’s another $10 billion cut in asset purchases and a basic steady outlook on the economy. Janet Yellen has unnerved the markets when she dissed the importance of the FED‘s DOT PLOT charts, which reflected FOMC members’ predictions on the fed fund targets for interest rates into the next two years. Chair Yellen said that for the near future it will be words and not “DOT PLOTS” that markets should concentrate on, especially after yesterday’s very weak first quarter GDP numbers. The economy was very weak and the FED now leads us to believe that weather was the primary force and expects the second quarter to pick up some of that delayed demand. Unfortunately, the consumer spending and health care costs were the most robust parts of the first quarter and the consumer spending flies in the face of the weather impact.


Notes From Underground: Hark There Are No Angels as the Devil is In the Details

January 3, 2013

The fiscal crisis came and went and yet the Potemkin village remains. So much was made about the looming fiscal calamity and its dire consequences that the probabilities of a compromise were overwhelming. Not only did fiscal sanity fail to show, the final package was beyond my comprehension. As the nation’s focus was supposedly on Congress, these purveyors of fiscal rectitude passed a BILL that was laden with pork. NASCAR, Hollywood, alternative energy et. al. were the recipients of CONGRESSIONAL LARGESSE IN THE TIME OF FISCAL AUSTERITY. There is no shame in the payment of political favors even in the full view of the MIDDLE CLASS.


Notes From Underground: Friday’s Unemployment, Or, Our Own Version of Operation Twist

November 1, 2012

Ah, the November 1 and the equity market regained its footing from yesterday’s post-Sandy house cleaning. The NASDAQ 100 recovered to close back above the midweek break below the 200-day moving average (2659) and closed in full rally mode. Supporting the NASDAQ action was the S&P/U.S. BOND RATIO, which gives a picture of interest rates to equity prices, also tested its key moving average and held after a short breach. It is amazing how many markets have reverted back to the 200-day m.a. in the last two weeks, which is a sign of health for the market as so many different trading instruments have been technically overextended–reversion to some established mean is a sign of health. Now that so many variables have reverted the market is set up to reveal some coming story. I am not sure of the tale but it is a signal to be alert for some approaching volatile price action.


Notes From Underground: A Few Quick Hitters As the Market Returns

October 31, 2012

***The Canadian situation became more muddled today with the release of its GDP. BOC Governor Mark Carney and FM Flaherty would love to raise rates in an effort to halt the rise of private debt, but today’s GDP showed a 0.1% decline in growth for the month. It is a real dilemma as the strong Canadian dollar is impacting some sectors of the economy and thus a rate increase to stem credit growth will have a strengthening impact. The GDP release blamed the slowing global economy for the downturn but it has not impacted domestic credit growth because of ultra-low rates. How will the Canadians solve this dilemma as it wants to slow the housing sector to help forestall private loans? This conundrum will test Carney’s position as a leading central banker. Let’s watch to see if it is possible to head off asset appreciation without causing system wide economic pain. Greenspan and Bernanke claim it is not possible. Governor Carney, here’s your chance to help set central banking on a better course.


Notes From Underground: The Tight Rope Walker Was The Key Circus Performer

September 6, 2012

As I covered in NOTES yesterday, the three-ring circus was coming to town Thursday and the show was so fantastic that it dazzled investors worldwide. The RIKSBANK began the show by cutting its rate by 25 basis points to get the audience in a festive mood. Mervyn the Magnificent from the Bank of England did his laying down and going limp act so as not to be sawed in half by the by those magicians of the slight of hand. The BOE left everything as is and presented a very benign statement that offered up very little as to its rationale for maintaining the present rates as well as the same ASSET BUYING PROGRAM. The market was gawking at the rising financials in Europe when in the center ring, Marvelous Mario dropped his cape and headed out on the high wire in which the safety net was pretended to be removed or was totally transparent.


Notes From Underground: Central Bank Poker–After the AUSSIES CHECKED, the BOE BET; the ECB CALLED

July 5, 2012
No great surprises from the mandarins of global finance. First, the BOE announced the widely anticipated 50 BILLION QUID increase in the QE program but Mervyn King and company did not cut the overnight lending rate. Following on the heels of the BOE, the ECB, under the guidance of Mario Draghi, cut the overnight rate by 25 basis points to 0.75% and also lowered the ECB deposit rate to zero from 0.25%. Again, no surprises, although the DEPOSIT RATE CUT WAS NOT WIDELY EXPECTED. Why did Draghi move to make the deposit rate ZERO?

Notes From Underground: MAY 6 — A Flash Crash For the European Political Elite

May 6, 2012
Before politics, it is important to review the two big stories from Friday:
1. The U.S. unemployment data was certainly on the weak side of expectations as nonfarm payrolls came in at a tepid 115,000, very close to the ADP report. Average hourly earnings were soft, which will challenge the view of consumer demand ramping up any time soon. Yes, the unemployment rate dropped to 8.1%, but with so many people dropping out of the job market this indicator lends itself to so much POLITICAL SPIN THAT ITS USE IS BECOMING NEGLIGIBLE. Economists have twisted its meaning and therefore markets are disregarding its usefulness. The real positive in the data was the continue growth in MANUFACTURING as 16,000 factory jobs were created. Otherwise, the number was weak and will be a reason for the FED TO KEEP THE MUSIC OF OPERATION TWIST IN PLACE.