[转贴] Weekend Market Update March 16, 2014

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Equities dipped notably this past week, largely on news from overseas. The week got off to a soft start with stocks dipping early in the week as data out of China showed exports dropped over 18% from the previous year against expectations of a 4% rise. After pausing mid-week, stocks tumbled Thursday with the benchmark S&P 500 Index (SPX) suffering its worst day since the start of February. The rising tensions between Ukraine and Russia and the slow growth in China had investors taking profits.  Better U.S. economic data (higher retail sales and lower initial jobless claims) were overshadowed as focus shifted to Sunday's referendum in Crimea when the population will be asked whether they want to become part of Russia. Stocks continued downward Friday on continued worries about the vote on Crimea. Also, consumer sentiment for early March fell short of expectations. The S&P 500 Index (SPX) fell 2% while the Dow Jones Industrial Average ($DJI) led major indices down as it was off 2.4% for the week. The tech-heavy Nasdaq (NDX) fell 2.1% and the market-leading small caps (RUT) lost 1.8%.



Option Volatility rose sharply this past week as investors bought protection ahead of the Ukraine vote later today. The CBOE Volatility Index (VIX) rose 26% for the week as traders positioned themselves most of the week. The S&P 500 Index (SPX) had just hit all-time highs the Friday before last week so despite the rise in ‘Fear’, stocks are just below record levels. Tensions have continued to rise this weekend so we could see a volatile week in the markets regardless of the outcome of the vote on Crimea. The $20 level in the VIX will most likely be a resistance level to the upside but any settle above it could spell more pain for equities.



Treasury yields declined moderately this past week. After little change on Monday and Tuesday, rates eased Wednesday on concern that slowing growth in the Chinese economy would weigh on global economic growth. The biggest move of the week was Thursday as rates declined on flight to safety on worries about the then upcoming referendum in Crimea. Rates held steady at week’s end but demand for the safety of U.S. Treasuries was strong as the ‘Risk-Off’ trade was on. Oil futures (/CL) broke their recent bullish trend. Crude dropped 3.5% for the week on rumors that U.S. stockpiles rose the prior week.



This week is heavy with economic news. The spotlight is on Fed Chair Janet Yellen’s first quarterly press conference, the Fed statement, and Fed forecasts. Manufacturing and housing sectors have been wavering. Key updates also come from industrial production, housing starts, and existing home sales. Earnings season is all about wrapped up but major reports from a few bellwethers such as Oracle (ORCL), FedEx (FDX) and Nike (NKE) are due. The main focus will remain on the geopolitical issues in Ukraine so watch equity futures (/ES) after they open at 5 pm CT today for market direction.




Major Earnings for the Upcoming Week:

Monday:  JASO



Tuesday: ADBE, CCL, DSW, HTZ, ORCL, PSUN



Wednesday: FDX, GES, GIS, JBL, KBH



Thursday:  AAR, CAG, CTAS, LEN, NKE



Friday: DRI, TIF



Economic Releases (3/17-3/21):

Monday:

7:30 am CT – Empire State Mfg. Survey

8:00 am CT – Treasury International Capital

8:15 am CT – Industrial Production

9:00 am CT – Housing Market Index

                                                                                                                                                                                

Tuesday:

6:45 am CT – GS Store Sales

7:30 am CT – Consumer Price Index (CPI)

7:30 am CT – Housing Starts

                                                                                                                                                                                                              

Wednesday:

6:00 am CT – MBA Purchase Applications

9:30 am CT – Oil Inventories

1:00 pm CT – FOMC meeting announcement

1:30 pm CT – Fed Chair Press Conference

                    

Thursday:

7:30 am CT– Weekly Jobless Claims

9:00 am CT– Philly Fed Survey

9:00 am CT – Existing Home Sales

9:00 am CT – Leading Economic Indicators

9:30 am CT – Natural Gas Inventories

                                                                                                                                                                                                        

Friday:

None

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