Jan 18, 2010

Daily Markets - Financial News & Opinions

Daily Markets - Financial News & Opinions

Gold Is One Investment Market Manipulators Can’t Touch

Posted: 18 Jan 2010 03:45 AM PST

There’s one investment that Wall Street manipulators can’t touch - and neither can the Fed or the U.S. government. Right now that investment is gold.

Take Goldman Sachs (GS) for instance… After bailouts from the U.S. Treasury Dept, they just posted $16.7 billion in compensation for its traders. At the last G-7 meeting, one insider counted 24 our of 32 finance ministers as ex-Goldmanites. The firm regularly trades along with - and against - its own clients. And now it’s even hording … [visit site to read more]


Forex Trading Commentary: Euro Weighed Down By Greece’s Problems

Posted: 18 Jan 2010 03:39 AM PST

The start of another week brings with it a fresh spate of sovereign debt concerns, today sparked by an article in the UK’s Telegraph that speculates the ECB is ruminating over the potential legal framework for the possibility of a country leaving the European monetary union. Whether the cited document (entitled: “Withdrawal and expulsion from the EU and EMU: some reflections”) has come about at the request of any genuinely influential entity is far from clear, but the headline and the message … [visit site to read more]

Is The Crude Oil Market Destined For A Crash By The Contango Trade Unwinding?

Posted: 18 Jan 2010 02:35 AM PST

The West Texas Intermediate (WTI) crude oil market went into contango back in June 2008 and reached an apex super contango in late December. (Fig. 1) Since then, investment firms, investors as well as producers have been stockpiling oil and booked a record number of vessels for storage seeking to profit from the contango effect in the oil market.

In fact, the WTI futures curve serves as a good indicator of the U.S. oil inventory levels since a contango typically coincides with higher … [visit site to read more]

Forex Trading Review For Monday 18 January

Posted: 18 Jan 2010 01:32 AM PST

USD Dollar (USD)

The Dollar gained versus most majors as stocks declined following investor’s doubts about the economic recovery. Consumer Price Index came out worse with 0.1% versus 0.2% expected but had no effect. Michigan’s Consumer Sentiment came out weaker as well with 72.8. NASDAQ and Dow Jones declined by -1.24% and -0.94% respectively led by drops in the financial sector. Crude dropped by -1.75% closing at 78$ a barrel and Gold (XAU) declined by -1.09% closing at 1130.10$ an ounce. … [visit site to read more]

PPLT, PALL Come Flying Out Of The Gate

Posted: 18 Jan 2010 01:00 AM PST

Given the tremendous amount of buzz surrounding the launch of the first U.S.-listed platinum and palladium ETFs earlier this month, perhaps the initial results for the ETFS Physical Platinum Shares (PPLT) and Physical Palladium Shares (PALL) shouldn't be that surprising. Through their first six days of trading, average volumes for PPLT and PALL were about 310,000 and 465,000 shares, respectively. PALL traded more than a million shares on its fourth day of trading. The two funds took in … [visit site to read more]

When Quants Fail

Posted: 18 Jan 2010 12:59 AM PST

I am sometimes asked why I am so anti-quant. That’s because there are many circumstances when quantitative analysis fails. I can cite two examples off the top of my head. The problems shown in the first example can be managed, but the second instance highlights a more serious problem with quantitative analysis and modeling in general.

The trees or the forest?
Avner Mandelman wrote a commentary about a company he analyzed. Everything seemed fine at first and from his description the numbers … [visit site to read more]

Poland’s Economy Is No Joke

Posted: 18 Jan 2010 12:01 AM PST

Watching the world’s leaders stumble their way through the economic crisis, it often feels as if political success and economic understanding are mutually exclusive. Even the Chinese, who over the past generation have engineered a dramatic turnaround from their Maoist economic nightmare, show a remarkable willingness to pursue a monetary policy (a currency peg to the U.S. dollar) that yields no benefit to their citizens. Amid this morass of economic quackery, it is refreshing to see a clear … [visit site to read more]

The Imminent Earnings Season Will Dictate Whether Or Not The Current Stock Market Bullish Trend Will Persist

Posted: 17 Jan 2010 11:01 PM PST

The Dow Jones index ended the week at 10,609.65 on a negative note with Friday’s 0.94% loss more than offsetting the gains made during the four previous sessions. Investors were prompted to bank equity profits on mixed economic data and took the opportunity to build cash positions ahead of key earnings news expected next week. IBM (IBM), Google (GOOG), Bank of America (BAC), General Electric (GE), Goldman Sachs (GS) and Citigroup (C) are all due to report Q4 earnings along with … [visit site to read more]

Will The US Need Canadian Natural Gas? Apache Moves In Fast

Posted: 17 Jan 2010 10:01 PM PST

Americans are moving quicker than Canadians to secure profitable markets for Canadian natural gas.

On Wednesday, Apache Corp. (APA) of Houston bought control of Canada’s only proposed export facility for Liquid Natural Gas (LNG), located in Kitimat B.C., for an undisclosed sum.  Why?

They see the US market for Canadian natural gas is dropping, as fast rising US production of low cost shale gas makes Canadian gas uncompetitive and increasingly unnecessary.

Apache has just … [visit site to read more]

Picture Of The Day: Dow Rally In Perspective

Posted: 17 Jan 2010 09:01 PM PST

The Dow Jones Industrial Average has recorded a gain of 62.1% since the current rally commenced on March 10. In order to put the rally in historical perspective, Chart of the Day has provided a handy graph on which all major market rallies since 1900 are plotted.
Each dot on the graph below represents a major stock market rally as measured by the Dow and shows the Average began a major rally 27 times over the past 110 years, i.e. an average of one rally every four years.
Most major … [visit site to read more]

Negative Divergences Abound In S&P 500: Cyclical Weakness Ahead?

Posted: 17 Jan 2010 08:01 PM PST

While the S&P 500 had managed to squeeze slightly above the ascending wedge that has contained the index for several months, this week it dropped back below the support and it is currently challenging the bottom of the wedge. The wedge has not resolved decisively in either direction, and it is possible that there will be no clear resolution. By that I mean the wedge is so narrow that the price index could continue to drift higher, lower, or sideways to where it will have exited the wedge … [visit site to read more]

Singapore Stock Market Update For Monday 18 January

Posted: 17 Jan 2010 05:52 PM PST

Morning Highlights
Singapore market kicked off the week on a soft note as dragged by weakness on Wall Street, with the STI down 9.82 points to 2898.60.

CapitaCommercial Trust requested a trading halt, pending the release of an announcement.

Numbers on the Non-oil Domestic Exports in December will be released today.

With U.S. markets closed Monday (Martin Luther King Jr. Day), many investors are likely to be on the sidelines, and awaiting earnings from major financial firms due this … [visit site to read more]

Now And In The Future

Posted: 17 Jan 2010 05:40 PM PST

A recent report in USA Today argued that the recession’s scars will linger long after the economy heals:

The aftershocks from deep recessions reverberate for years, even decades, and take an enduring toll on everything from government finances to countless upended individual lives.
“People assume once the recession is over, people go back to work. They don’t quite get the long-lasting impact,” says economist John Irons of the Economic Policy Institute in Washington, D.C.
What Irons calls … [visit site to read more]
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