Keystone presents the following underlying market currents, sometimes subtle, sometimes turbulent, that move global markets in real time. The key dates and times below typically correspond to market pivot points.
Key Dates and Times for the Week Ahead:
· Keystone’s Comments on the Upcoming Week: The U.S. Presidential election is now only 50 days away. The FDX earnings, Housing Starts and China HSBC Flash PMI data are very important this week. The ECB’s bond-buying program is underway. Watch for news on Spain bailout or lesser agreement of 100 billion in aid since markets should rally slightly on this news. The next ECB meeting is 10/4/12 where a possible rate cut may occur, if so the euro will fall in value against the dollar. Europe must move to a weaker euro to help the continent grow out of its mess. Spain’s bailout may be a problem since Spain does not want to meet conditionality for the money, like the teenager that has all the answers and misbehaves but then has the hand out for allowance. Bank runs and European riot worries remain a concern. The Greece talk will heat up again as the day’s move along since they need approval of another tranche of aid. The European news flow directly dictates global market direction. Watch for further China easing measures such as lowering rates or triple R’s which will bounce equity markets. China, however, announced infrastructure stimulus on 9/7/12 and appears more focused on local stimulus programs instead. China Flash PMI data on Wednesday night is very important and will move markets. Middle East and Northern Africa turmoil requires attention. Oil price should remain buoyant as the violence remains or escalates. A possible SPR (Strategic Petroleum Reserve) release may occur which would be in response to rising oil prices but in actuality help President Obama’s reelection campaign. Otherwise, high gasoline process going into the election will hurt the president’s prospects. U.S. trading volume will increase as the day’s move along this month into October now that Labor Day is over. Volumes increased for the Fed’s QE3 money-pumping scheme announced last week. Pre-announcement confessional season is underway where companies announce any potential problems with earnings ahead of time to minimize the damage. Call Father John to help out since the confessional box is already very busy with FDX and INTC both lowering forecasts. Weaker shipping and semiconductor industries are proof of a weak global economy. Volatility, the VIX, typically bottoms in August and now sits at 5-year lows so watch this closely going forward, far higher volatility is expected. Larger intraday price swings occur with higher volatility. Traders are much too complacent now since they expect the markets to be supported by central banksters forever. The CPC put/call ratio printed 0.69, uber complacency with no worries or fear, sounding a Stage One alert that the broad indexes are placing a major market top right now and should experience a significant sell off in the near future. Interestingly, the smart trade may not be by the majority of traders that jumped in long last week but instead the handful of traders that expect a strong pull back first, in the coming days and weeks, into October, where the ideal long buying time will actually occur. Congress goes back on vacation until after the presidential election; markets are typically bullish when Congress is not in session. Ten Fed heads spew this week, out in full force to talk up QE3, or perhaps more correctly nine, since Lacker exhibits intelligence placing the only vote against QE3. Lacker speaks Tuesday night. The Federal Reserve continues to destroy the dollar and the country.
· Monday, 9/17/12: Euro Finance Ministers conclude meeting, Spain and Greece remain major concerns. AAPL iPhone5 sales numbers should be available to provide an initial gauge of the successful release, or not. Occupy Wall Street movement one year anniversary-do they riot on Wall Street? Empire State Mfg Survey 8:30 AM. RBA Minutes 9:30 PM-important for commodities. Monday’s are typically down days in recent weeks. During OpEx week, however, Monday’s are typically buoyant. Happy Rosh Hashannah (New Year) today so the old adage is "Sell Rosh Hashannah and buy Yom Kippur (9/26/12)," but it is wrong as much as it is right. Earnings: LDK.
· Tuesday, 9/18/12: China Property Price data. Fed’s Evans speaks 8 AM. Current Account data 8:30 AM. TIC data 9 AM-gauge foreign investment in the U.S. Housing Market Index 10 AM. Fed’s Dudley speaks 11:30 AM. Fed’s Lacker speaks 6:15 PM-the only dissenting vote against QE3. Markets are typically bullish from a Tuesday low into a Wednesday high during OpEx week. Earnings: FDX-shipping indicator-huge importance due to it already lowering its forecasts-watch Keystone’s UPS 20 and 50-week MA cross indicator on the Cyclical Turn page as well, MANU.
· Wednesday, 9/19/12: Mortgage Purchase Applications 7 AM. Housing Starts 8:30 AM. Fed’s George speaks 9:45 AM. Existing Home Sales 10 AM, expect a market pivot point. Oil Inventories 10:30 AM. Fed’s Fisher speaks 7 PM. China HSBC Flash PMI Manufacturing data 10:30 PM (49 or higher risk on, 47.5 or lower risk-off), extremely important for commodities, especially copper. China Premier attends EU Summit. Earnings: ADBE, APOG, AZO, BBBY, CBRL, GIS, MLHR-furniture indicator, SCS.
· Thursday, 9/20/12: Rajoy and Monti meet today and tomorrow. Germany’s Schauble speaks. Fed’s Rosengren speaks 7:45 AM. Jobless Claims 8:30 AM. PMI Flash Mfg Index 9 AM. Fed’s Lockhart speaks 9:30 AM. Philly Fed Survey and Leading indicators 10 AM, expect a market pivot point. Natty Gas Inventories 10:30 AM. Fed’s Kocherlakota speaks 12:30 PM. 10-Year TIPS Auction 1 PM. Fed Balance Sheet and Money Supply 4:30 PM. Fed’s Pianalto speaks 5 PM. Fed’s Bullard speaks 6:30 PM. Earnings: CAG, CTAS-uniform indicator, JEF-any M&A activity?, KMX, ORCL, RAD, TIBX.
· Friday, 9/21//12: Quadruple Witching OpEx Expiration. AAPL iPhone5 is available for sale-how large are the lines? Fed’s Lockhart speaks 12:40 PM. The way the markets trend today, OpEx Friday, especially into the close, typically result in the opposite move come Monday. Earnings: DRI-are people eating out or eating macaroni and cheese at home?, KBH-this was a debacle last time so it takes on large importance also considering QE3 is buying MBS to help the housing market. Autumn begins for the Northern hemisphere this weekend.
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· Late September: Troika Report is due which is needed for leaders to make a decision with Greece. Also watch for any negative change to Spain’s debt ratings, which may be a new wrench in the works, and will cause bond yields to rise again. Spanish bank audits are due. Window dressing is expected to dress-up the Q3 quarterly statements--winning stocks this quarter are bolstered higher and losing stocks are further beaten.
· Tuesday, 9/25//12: Consumer Confidence 10:00 AM.
· Friday, 9/28//12: Consumer Sentiment 9:55 AM. EOM. Full moon tomorrow—markets tend to be bullish into the full moon.
· Sunday, 9/30//12: Bradley turn date-a window opens for a potential market trend change between 9/24 and 10/5.
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· Wednesday, 10/3/12: First of Three Presidential Debates; Obama v. Romney 9 PM EST. Q4 begins, where tech and biotech typically outperform.
· Thursday, 10/4/12: ECB Rate Decision 7:45 AM EST and Press Conference 8:30 AM.
· Friday, 10/5/12: Monthly Jobs Report 8:30 AM.
· Monday, 10/8/12: Euro zone Finance Ministers meeting-next tranche of aid for Greece is needed. ESM Inaugural Meeting.
· Thursday, 10/11/12: First and Only Vice Presidential Debate; Biden v. Ryan 9 PM EST.
· Tuesday, 10/16/12: Second of Three Presidential Debates; Obama v. Romney 9 PM EST.
· Thursday, 10/18/12: ECB/Euro Summit-banking union outline is expected and Merkel may avoid a decision on Greece’s aid until now? Will Greece exit the euro? A Greece decision is needed now or sooner. Will the banking union discussions go smoothly?
· Monday, 10/22/12: Third and Final Presidential Debate; Obama v. Romney 9 PM EST.
· Tuesday, 10/23/12: FOMC meeting begins. FB earnings and conference call.
· Wednesday, 10/24/12: FOMC Rate Decision 2:15 PM.
· October: New China Premier officially selected.
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· Friday, 11/2/12: Monthly Jobs Report 8:30 AM-last report before the election, do you magically see a 7.9% or lower unemployment rate (under the 8 handle) perhaps helping President Obama?
· Tuesday, 11/6/12: U.S. Presidential election decides on Obama or Romney.
· Tuesday, 12/11/12: FOMC meeting begins. FB earnings and conference call.
· Wednesday, 12/12/12: FOMC Rate Decision, Forecasts and Press Conference at 12:30 PM, 2 PM and 2:15 PM, respectively. Expect market pivot points especially at 12:30 PM and after 2 PM.
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· Tuesday, 1/1/13: ESM is officially up and operating.
· Wednesday, 1/2/13: If Congress does not act, the U.S. drives off the “massive fiscal cliff” (a phrase coined by Chairman Bernanke in early 2012) that will cut the GDP, increase unemployment and immediately launch the country into recession, but, on the positive side, the nation’s debt will decrease.
· March: New China Premier takes control.
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