Financials; Not a ton of real money buying on this pullback.; Sentiment remains extremely negative Senate's vote and tomorrow's $XLF

• ·Financials: Following last night's successful House vote on financial reform, the sector underperforms following disappointing Jobless Claims, ISM and Pending Home Sales data. Banks (especially the large caps) are weak in early trading.
• Volumes are heavy on the sell-off and increased dramatically following the 10am economic reports. Likewise, flows remain very active. The 10am number brought out real money sellers and led fast money to press shorts aggressively. Once we held the 1006 technical level, shorts to come in and cover.
• Haven't seen a ton of real money buying on this pullback. We're seeing some institutional support within life insurers and defensively positioned banks, but nowhere else.
• Sentiment remains extremely negative heading into the Senate's vote and tomorrow's June Employement report. As estimates continue to come down for Q2 earnings, it is unclear what positive catalyst (other than valuation arguments) is going to lift the group between now and Q2 report.

Economic Headlines;US jobless claims US Durable Goods 06.24.10

 

Economic Headlines
· US jobless claims - Following the jump in claims last week, initial jobless claims for the week ending June 19 decreased to 457,000 from the prior week’s revised value of 476,000, returning close to the June 5 level. This is a slight improvement over the values we have seen over the past month with the four-week moving average decreasing 1,500 to 462,750. Continuing claims dropped off for the week ending June 12, decreasing by 45,000 to 4,548,000.   
· US Durable Goods - The details of the May durable goods report were quite solid and signal that business capital spending is still on a firming trajectory. Although headline durable orders fell 1.1%, this decline was entirely due to a fall-off in the volatile aircraft category, which had surged forward in April. The more important core capital goods category (which excludes aircraft and defense capital equipment) saw orders rise 2.1% and shipments increase 1.6%.