The VIX is up 14%. Volatility returns with great force!
-
11AugFinancial transaction, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, daily stock picks, daily stock tips, daytrades, deals, debt, fed action, financial settlement, free stock info, free stock picks, free stock tips, market facts, markets, trading, trend, usa economics No Comments
Tags: The VIX is up 14%
-
28JulFinancial transaction, Movers & Shakers, breaking market news, breaking news, breaking wall street news, fed action, financial settlement, government, housing markets, market analysis, market projections, short term investments, usa economics No Comments
Beige Book Makes It Official: Economy Has Slowed Down
The latest Beige Book report from the U.S. Federal Reserve confirms what other recent economic reports have suggested: The U.S. economic recovery slowed somewhat in the second quarter, with some regions reporting stalled conditions.
-
16JulFinancial transaction, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, daily stock picks, daily stock tips, free stock info, market analysis, market facts, trend No Comments
Stockshakers stories moving the markets now
Goldman settles with SEC for $550 mln;shares surge
Wall St reform clears Congress, goes to Obama
BP says test shuts off oil leak from Gulf well
AgBank closes mega IPO with tepid HK debut
Dollar weakens on U.S. data, Asian stocks dip
Australian PM set to call election for Aug 28 -ABC
China to trade yuan/ringgit in onshore mkt-sources
China’s Wen says policy stability is H2 priority
Japan vows to stick to JGB issuance, spending caps
Two final bids seen for Aus Healthscope-sources
Google profit misses as expenses surge
U.S. jobless claims fall, manufacturing stumbles -
01JunFinancial transaction, banking, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, cash, debt, fed action, financial settlement, government, loan, market facts, money, return rate, structured settlements, usa economics No Comments
U.S. Regulators Close Five More Banks
* EverBank
* Bank of Florida
* Granite Community Bank
* City National Bank
* Sun West BankThe U.S. state and federal regulators have shut down five banks in Florida, California and Nevada, The Wall Street Journal reports. The closure has brought the nationwide total of failed institutions until May 2010 to 78.
EverBank of Jacksonville will buy the banking operations of the three units of Bank of Florida, including a combined $1.32 billion in deposits. The regulators have also seized California-based Granite Community Bank, which will be taken over by Tri Counties Bank. The Los Angeles-based City National Bank will acquire the Sun West Bank, which has $353.9 million in deposits.
-
31MayFinancial transaction, Movers & Shakers, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, daily stock tips, daytrades, fed action, financial settlement, free stock info, global economy, market analysis, market facts, markets, short term investments, stockmarket analysis, stocks, trading, trading ideas, trend, usa economics No Comments
2010 The Worst May in a Half-Century
Assessing damage from the worst May since 1962.
THE STOCK MARKET SUFFERED its worst May in a half century, but there’s a bright side to the darkening mood: A 12.3% slide since late April and greatly diminished expectations mean any good economic news this summer might, once again, carry a jolt of surprise.Within a month, our focus has swung from convalescing corporate profits to Europe’s fiscal chaos and the drag on global economic growth. A 14-month rally without major setbacks has also swelled the throng of uneasy investors who were anticipating, quite rightly, a correction — and who were poised to sell.
.How worried have we become about global growth? A recent survey showed the huddle of bearish investors (51%) dwarfing the bulls (30%) by the biggest margin since last summer. Money managers lunging at options to protect their portfolios drove the VIX volatility index above the 40 threshold for just the sixth time ever — joining, in the panic hall of fame, the 1987 stock-market crash, the 1998 Russian financial crisis, the dot-com bubble collapse, the Sept. 11 attacks and the 2008 credit crunch.
For investors, the most pressing question now is how much damage is already factored into retreating stock prices. The market now trades at roughly 11 times what Standard & Poor’s 500 companies are expected to earn over the next two years — slightly below its 25-year average, but richer than the stricken 8 multiple when this bull market unfurled, in March 2009.
Morgan Stanley’s global strategist Gerard Minack thinks the market would have made “a reasonable allowance” of the downside risk to earnings at 10 times. That’s roughly 9% below the current level, and it assumes sovereign stress remains contained and economic data point to slower growth but no hard landing. “There is a risk the growth slowdown is more pronounced in 2011, but we doubt investors will see enough news to price in such a risk in, say, the next one to two quarters,” he notes. In other words, the S&P 500 at 1000 might have priced in the second half’s “probable” risks.
Last week, the S&P 500 dipped as low as 1041 before rebounding, and the swings were frequent and violent. An early plunge on Tuesday drew buyers, but Wednesday’s early rally was promptly sold. Thursday’s 3.3% surge, after China said it wasn’t bailing on European debt it held, fizzled Friday after a rating agency did something neither original nor startling: It downgraded Spain’s credit rating. Consumer spending was flat in April, Dreamworks Animation (ticker: DWA) drooped after the fourth installment of Shrek, which is one installment too many, disappointed at the box office, while Hugh Hefner showed you can’t have too many playmates and mansions — Playboy Enterprises’ (PLA) plan to open two clubs in Macau lifted partner Las Vegas Sands’ (LVS) shares 12%.
.The S&P 500 eked out a 2-point gain to finish the flip-floppy week up 0.2% at 1089. It is still 10.5% off its late-April high. The Dow Jones Industrial Average fell 57, or 0.6%, to 10,137. The Nasdaq Composite Index rallied 28, or 1.3%, to 2257, its second gain in three weeks, while the Russell 2000 added 12, or 1.9%, to 662. But European and Chinese stocks rebounded nearly 3%, both snagging their second gain in three weeks, while copper halted a four-week slide.
With U.S. markets closed Monday for Memorial Day, the S&P 500 will end this month down 8.2% — its worst May since 1962, and the biggest monthly slide since February 2009, just before this bull market began. The May losses totaled 7.9% for the Dow, 8.3% for the Nasdaq, and 7.7% for the Russell.
EMERGING MARKETS AREN’T immune if global growth sputters, but is the new world unfairly flogged for the old world’s budgetary sins? Before Thursday’s rebound, the MSCI Emerging Market iShares (EEM) were off 15% from their late-April peak, barely better than the 17% drubbing meted out to the MSCI EAFE iShares (EFA) that track developed markets. Have we swung so far from the abandoned notion of “decoupling” economies that we now expect all markets to be fused at the hip?
Emerging markets unencumbered by debt are struggling for other reasons: Some of their economic indicators are stalling, and the stronger dollar threatens their export-dependent economies. But if the looming global slowdown is to be blamed on developed countries’ fiscal wantonness, then emerging markets’ chaste balance sheets ought to offer some solace. China’s public debt, for example, is just 18% of its gross domestic product, compared with nearly 200% for Japan. In fact, emerging markets’ ratio of debt to GDP averages 37% — a fraction of the developed world’s 94%. Even Israel, the emerging nation with the highest debt-to-GDP ratio, 78%, has been plucked from those ranks and newly reclassified as a developed market.
Calling emerging markets “the baby getting thrown out with the bath water,” Bespoke Investment Group founder Paul Hickey listed a dozen American depositary shares of emerging-market companies whose charts look strong even after the recent correction. These include the Brazilian beverage company Companhia de Bebidas das Americas (ABV); Chinese Internet search company Baidu (BIDU); America Movil (AMX), a Mexico-based telecom giant; and Peruvian bank Credicorp (BAP).
Blame Europe: The old saw about selling in May and going away has never been so right, as fear of slowing global growth sent the Dow down 7.9% this month.
.With Europe hobbled and the U.S. humbled, emerging markets’ short-term fate may depend disproportionately on China. Ironically, trouble in Europe helps reduce the odds that China’s economy will overheat. In fact, the hit to global growth gives China’s central bank some breathing room in its crusade to tighten monetary policy, says Morgan Stanley’s China economist Qing Wang. The firm deems a hard landing in China in the foreseeable future “unlikely,” is overweight Chinese stocks, and continues to recommend developed world stocks that are exposed to emerging markets.ARGON ST, WHICH MAKES sensors for military intelligence, has been on the radar of big defense contractors ever since it hired financial advisers and reportedly began shopping itself to giants like Raytheon (RTN). and Boeing (BA). But the speculative frenzy has subsided a little, and the stock price has fallen more than 10%.
The decline can’t all be blamed on the market correction; the small defense intelligence specialist also reported underwhelming second-quarter earnings.
This takes Argon (STST) to an intriguing juncture: With shares near 24, down from their 2010 peak above 27, Oscar Gruss’ special situations analyst Bill Kavaler pegs the potential stock upside at $6 if a suitor surfaces, although shares could fall $2 if no deal is reached.
Argon shares aren’t cheap, and already fetch 21 times projected profits, but small contractors with proprietary know-how typically command a premium, and Argon’s multiple is still just shy of its median over the past five years. Although fiscal belt-tightening doesn’t bode well for defense budgets in general, Argon specializes in the kind of reconnaissance and surveillance technology that can help the leaner armies of tomorrow.
-
20MayFinancial transaction, Movers & Shakers, daily stock picks, daily stock tips, daytrades, deals, financial settlement, free stock info, free stock picks, free stock tips, market projections, markets, short term investments, stockmarket analysis, stocks, technical analysis, trading, trading ideas, usa economics No Comments
Wednesday:
Volume quietly increased today as the S&P 500 lost another half percent. Although the market staged a rally late to recover most of its losses. With the volume starting to increase now as the market goes down, the next few days will be very interesting. The market could challenge the lows made a couple weeks ago. We could see a market malaise set in that brings the indices lower on lower volume. However, if the volume remains lower than the first leg down, we should see a strong rebound shortly thereafter.
Market downtrends are notorious for quick, vigorous rebounds followed by more selling.
Keep your stops tight and be safe.Dow Futures are currently flat to slightly up +7.
Friday is an options expiration day, be cautious here.
Tags: Markets outlook for the trading session Thursday 05.20.2010, stock market outlook
-
16MayFinancial transaction, Movers & Shakers, banking, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, debt, fed action, financial settlement, structured settlements No Comments
Bank Failures outpace 2009’s default rate
State regulators closed four community banks Friday, bringing the total number of failed banks for 2010 to 72. Year-to-date bank failures were more than double the pace for the same period in 2009, when there were 33 bank closures.Midwest Bank & Trust
The largest bank failure on Friday was Midwest Bank & Trust of Elmwood Park, Ill, which was the main subsidiary of Midwest Banc Holdings (MBHI).After state regulators took over the institution, the Federal Deposit Insurance Corporation was appointed receiver and sold Midwest to FirstMerit Bank, NA of Akron, Ohio, which is held by FirstMerit Corp (FMER).
While Midwest Bank & Trust faced mounting loan losses, the deterioration of the bank’s capital first came to a head when the government-sponsored mortgage giants Fannie Mae (FNM) and Freddie Mac (FRE) were placed under government conservatorship in September 2008. On the holding company level, Midwest Banc Holdings reported total 2008 losses and impairment charges of nearly $82 million on the company’s investments in preferred shares of Fannie and Freddie.
FirstMerit paid the FDIC a premium of 0.4% for Midwest Bank & Trust’s $2.4 billion in deposits, and the FDIC agreed to share in losses on $2.3 billion of the assets First Merit acquired. Midwest’s 23 offices were scheduled to reopen Saturday as FirstMerit branches. -
15MayFinancial transaction, banking, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, debt, equity, financial settlement, liquidity, money, savings, structured settlements, trend, usa economics No Comments
Bank-Failures swell to 72 for 2010
State regulators shuttered small banks in Illinois, Missouri, Georgia and Michigan, including a 23-branch community bank that failed despite having received an infusion from the government’s Troubled Asset Relief Program.So far this year, 72 banks have collapsed and the spate of failures is expected to continue throughout 2010. Although there are signs that the worst of the financial crisis may be over for the banking industry, financial institutions are still being battered by severe losses on mortgages and commercial real-estate loans.
In the largest of Friday’s closures, Illinois regulators closed Midwest Bank & Trust Co. of Elmwood Park. FirstMerit Corp., based in Akron, Ohio, agreed to take over Midwest’s 23 branches, $2.42 billion in deposits and essentially all of its $3.17 billion in assets.
Midwest had been warning for months that it was in dire financial straits. On Thursday, the bank said in a securities filing that it would likely be placed into receivership because it had been unable to raise fresh capital after a previous plan had been rejected by the Federal Reserve.
Its failure is a financial blow to the government, which had previously swapped the preferred shares that it held in Midwest for common shares. The government had received the preferred shares when it injected Midwest with $84.8 million of TARP funds. Common shareholders typically are wiped out when a bank fails.
FirstMerit, which has been a bidder on other failed banks, agreed to pay the Federal Deposit Insurance Corp. a premium of 0.4% for Midwest’s deposits. FirstMerit also entered into a loss-sharing transaction on $2.27 billion of Midwest’s assets.
As part of the deal, the FDIC will receive a so-called value appreciation instrument, which will provide the agency with additional money if FirstMerit’s share price rises over a certain amount of time.
Midwest was the 11th bank to fail in Illinois so far this year.
Elsewhere, regulators in Georgia, Illinois and Michigan closed three one-branch banks.
In Georgia, state regulators seized Satilla Community Bank, of Saint Marys, Ga. Ameris Bank, based in Moultrie, Ga., agreed to assume all of the deposits and most of its assets. Satilla had $135.7 million in assets and $134 million in deposits at March 31.
Ameris, which is paying a premium of 0.19% to assume Satilla’s deposits, also entered into a loss-sharing agreement with the FDIC. It was the eighth bank failure of the year in Georgia.
Michigan regulators closed Plymouth-based New Liberty Bank, which had roughly $109.1 million in assets and $101.8 million in deposits. Bank of Ann Arbor, based in Ann Arbor, assumed all of the deposits and agreed to buy nearly all of the assets. It didn’t pay a premium for the deposits.
In Missouri, regulators closed Southwest Community Bank, based in Springfield. Its $96.6 million in assets and $102.5 million in deposits are being assumed by Simmons First National Bank, of Pine Bluff, Ark.
The FDIC estimated the four failures would cost $301.7 million to its deposit insurance fund.
Tags: Bank-Failure Tally Grows to 72 for 2010, Bank-Failures swell to 72 for 2010
-
14MayFinancial transaction, breaking market news, breaking news, breaking stock market news, breaking stock news, breaking wall street news, financial settlement, free stock tips, market facts, markets, stockmarket analysis, stocks, trading No Comments
Waddell is mystery trader in market plunge
A big mystery seller of futures contracts during the market meltdown last week was not a hedge fund or a high-frequency trader as many have suspected, but money manager Waddell & Reed Financial Inc, according to a document obtained by Reuters.
Waddell on May 6 sold a large order of e-mini contracts during a 20-minute span in which U.S. equities markets plunged, briefly wiping out nearly $1 trillion in market capital, the internal document from Chicago Mercantile Exchange parent CME Group Inc said.
The e-minis are one of the most liquid futures contracts in the world, providing holders exposure to the benchmark Standard & Poor’s 500 Index. The contracts can act as a directional indicator for the underlying stock index.
Regulators and exchange officials quickly focused on Waddell’s sale of 75,000 e-mini contracts, which the document said “superficially appeared to be anomalous activity.”
More than a week after the incident, it was still not clear what impact the unusual trading in the futures contracts had on the broader meltdown in the stock market.
Waddell manages the $22.1 billion Ivy Asset Strategy fund, which is well-known for hedging with equity index futures when manager Mike Avery, who is also chief investment officer at the company, feels uneasy about the market.
The Asset Strategy fund has dropped 2.76 percent this quarter, compared with a 0.80 percent decline in the S&P 500, data from Lipper Inc, a unit of Thomson Reuters Corp show.
Gary Gensler, chairman of the U.S. Commodity Futures Trading Commission, said in congressional testimony on Tuesday that it had found one sale that was responsible for about 9 percent of the volume in e-minis during the sell-off in the U.S. markets.
Gensler said there was no suggestion that the trader, whom he did not identify, did anything wrong in only entering orders to sell. Gensler said data showed that the trades appeared to be part of a bona fide hedging strategy.
WADDELL SAYS WAS HURT TOO
It is unclear what impact the trading in the e-minis had on stock prices during the plunge, but regulators have scrutinized futures trading because the sharp decline in that market preceded the dive in the broader U.S. equities market.
The document said that during the sell-off and subsequent rally, other active traders in e-minis included Jump Trading, Goldman Sachs Group Inc, Interactive Brokers Group Inc, JPMorgan Chase & Co and Citadel Group.
During the 20-minute period, 842,514 contracts in e-minis were traded. The CME document did not provide a break-out of Waddell’s trading during that crucial time, but said from 2 p.m. EDT (1800 GMT) to 3 p.m. it traded 75,000 contracts.
Overland Park, Kansas-based Waddell declined to return calls seeking comment. But in a statement, the company said: “Like many market participants, Waddell & Reed was affected negatively by the market activity of May 6.”
Waddell said in its statement that it often uses futures trading to “protect fund investors from downside risk,” and on May 6 it executed several trading strategies including the use of index futures contracts as part of normal operations.
The notional value of the contracts sold by Waddell was $4.2 billion, according to document. How much Waddell paid for the contracts was not stated, but typically the cost would be far less than their notional value.
The company, which advises and distributes the Ivy Funds, has made a name with good results from its family of mutual funds.
Waddell’s shares fell after the Reuters report, and closed down 5.3 percent at $32.25. Volume was 1.28 million shares, more than triple the daily average this year.
Analyst Jason Weyeneth of New York brokerage Sterne Agee said he had not learned anything on Friday to lead him to change his “neutral” rating on Waddell stock.
The CFTC declined to comment.
A CME spokesman, who declined to comment on the document, said the Chicago-based futures exchange operator never discusses customer activity.
“We found no evidence of improper trading activity or erroneous trades by CME Globex customers,” said CME spokesman Allan Schoenberg.
Trading in e-minis takes place entirely on the CME’s Globex exchange. Hedge funds and high-speed trading firms often use the e-mini in an arbitrage strategy that seeks to capture the change in prices between the futures contract and the S&P 500.
Waddell’s contracts were executed at Barclays Plc’sBarclays Capital and later given up to Morgan Stanley, according to the document.
CME said it spoke to representatives from both banks on May 6 and planned to speak to Waddell representatives the following day. The firm oversaw $74.2 billion in assets as of March 31.
Morgan Stanley told CME that it did not have concerns regarding Waddell’s activity because it “would typically use equity index futures to hedge macro market risk associated with the substantial long exposure of its clients,” the document said.
‘QUITE A SHOCK TO THE MARKET’
Gensler said the contracts were sold between 2:32 p.m. and 2:51 p.m., the height of the meltdown.
The market for e-minis on May 6 fell more than 5 percent in a little more than 5 minutes starting at 2:40 p.m. — the height of the crash, the document said. The e-minis began to recover before stock prices turned higher.
An order the size of the Waddell contract would be a big trade to execute on a normal day, said a trader whose firm is active in the S&P 500 futures market. About 50,000 contracts are typically traded in an hour, the trader said.
“To get rid of 75,000 contracts, that’s a lot of trading even if the market is healthy,” the trader said. “But when suddenly the market changes and there’s not as many bids there to trade with, 75,000 is going to cause quite a shock to the market.
“That’s an enormous position for anybody, whether it’s a hedge or whether it’s a trade. It’s a big position, no doubt about it,” the trader said.
-
09JanFinancial transaction, breaking news, cash, deals, financial settlement, money, return rate, usa economics No Comments
1913 Nickel Sells for $5 Million
1913 Liberty Nickle 5 million dollars
Some may call this unnamed collector crazy for spending a cool one hundred million times the face value of a 1913 nickel. Others envy the ability to drop $5 million on a single purchase that you can’t live in. Whatever your opinion may be, for numismatists, the 1913 Liberty Nickel is one of the most highly sought after and prized coins in United States history.
You have to wonder what the collector is going to do with it. One would assume they’ll want to admire it in their own hands, but they’ll have to be awfully careful with it. Imagine the frustration of accidentally flushing it down the toilet or having it slip through a hole in their pocket. It’s not the kind of thing you can replace you know.Concerns for its well being aside.
An unnamed California collector has paid $5 million for the Eliasberg specimen 1913 Liberty Head nickel, a record price for the coin and the second highest price ever paid for any rare coin.
“The new owner is a long-time Southern California resident and a dedicated collector of historic United States rare coins,†said Santa Barbara coin and jewelry merchant, Ronald J. Gillio, who negotiated the sale between the collector and the sellers, Legend Numismatics of Lincroft, New Jersey and Washington state business executive, Bruce Morelan.
Legend and Morelan jointly purchased the coin from New Hampshire dealer, Ed Lee, in May 2005 for a then-record price of $4,150,000. It is graded Proof-66 by Professional Coin Grading Service, and is the finest of the five known 1913 Liberty Head nickels.
Gillio said he talked with the collector about the coin for over three months.
“We spoke many times in recent months about the coin’s legendary numismatic status, and he agreed to purchase it for $5 million,” explained Gillio who recently was named Numismatic Acquisition Coordinator for Spectrum Numismatics International and Bowers and Merena Auctions, and continues his role for Collectors Universe as General Chairman of the Long Beach and Santa Clara Coin, Stamp & Collectibles Expos.
The unnamed collector took possession of the coin at an undisclosed Southern California location on Wednesday, April 25.
In 1913 the United States Mint introduced a new design for nickels depicting a Native American Indian on the front and a bison on the back. However, some nickels were struck dated 1913 using the previous year’s design of a symbolic “Miss Liberty.”
Only five 1913 Liberty Head nickels are known today. Two are in permanent museum collections at The Smithsonian in Washington, DC and the American Numismatic Association Money Museum in Colorado Springs, Colorado.
One of the previous owners of this particular 1913 Liberty Head nickel was renowned Baltimore banker, Louis E. Eliasberg Sr., known to collectors for the extensive, one-of-everything collection he assembled before his death in 1976.
“Weâ€re pleased that this coin now is in the collection of another devoted numismatist. We hope he enjoys it as much as we did,” said Laura Sperber, a partner in Legend Numismatics.
The worldâ€s record price for any rare coin is $7.59 million paid for a 1933 U.S. $20 denomination Double Eagle gold coin in July 2002.
Recent Comments