Tuesday, March 30, 2010

Overview- Market Update- Equity Sectors- Commodities-Treasuries $SPY $GS


         SPX: 1173.28 +0.1%; NASDAQ: 2410.69 +0.26%; Russell 2000, 0.2%
         Market Update – another lackluster trading session, w/o a lot of volume, conviction, or movement; people are in preservation mode into the end of the Q and aren't trying to make a big stand in either direction.  The holidays are exacerbating an already light-volume tape and hurting liquidity.  Desk noted some Q-end adjustments starting early (like selling out of financials, which were some of the best performing stocks in Q1, and rotating into relative laggards, like tech), but nothing major.  Still buy interest on weakness but no one willing to really chase prices higher.  All eyes on this Fri's labor number and the kick-off to earnings w/AA on Mon 1/12. 

         Equity Sectors – Tech was a clear outperformer today, up 50 bps, as AMAT's analyst meeting helped the group finish near their highs (AMAT raised its guidance late in trading today). All eyes will be on MU/RIMM for earnings Wed night. Financials were the weakest sector today, accounting for most of the market's weakness. The group started their selloff a few hours before Volcker's speech at 12:30pm ET and never recovered. We might also have been seeing some Q-end rebalancing in which funds sell the winners (i.e. financials) and buy the laggards (i.e. tech and energy). Industrials outperformed as well today as the group moved higher thanks to DHR's earnings pre-announcement last night. Materials ended the day higher as well as chemicals more than offset the weakness in metals. Discretionary, telecoms, and energy ended the day flattish, pretty much where they were around the middle of the day.
         Best Performing sp500 stocks: WFR, DHR, FMC, ETFC, MMM, CFN, SVU, RHT, VZ, HOT
         Weakest performing: TIE, THC, CEPH, MEE, ATI, CLF, C, T, PLD
         Commodities:  Oil came off its afternoon lows – to finish near its highs around $82.40, up ~0.3%. Natural Gas also came off its early afternoon lows to finish near its highs, just under $4, up ~3.7%. Copper traded flat into the close, holding on its early morning gains to finish up ~0.6%. Gold also traded flat into the bell, closing around $1105, down ~0.6%.
         FX: USD (DXY)  held on to its early morning gains – trading mostly flat in the afternoon; it finished trading near $81.50, up ~0.2% After rallying in the morning – the Dollar traded mostly flat vs. the Euro in the afternoon; finishing up ~0.5%. The dollar continued to come off its morning highs vs. the Pound, finishing down ~0.5%. The dollar traded flat vs. the Yen in the afternoon, and finished up ~0.4% The Euro traded flat vs. the Yen into the close to finish down ~0.1%.
Credit: Corp. Credit finished the day lagging equities, unable to match stock's late day rally. IG 14 finished out ¾ of a pt. while HY lost 3/16 of a pt.
         Treasuries: Treasuries the 2s continued to yield 106bps (pretty flattish for most of the day) while the 10s/30s strengthened a bit in the afternoon from their lows (ending up small on the day) – 10s finishing yielding 3.85%. The 2-10 year spread flattened a bit to 281bps.

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