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Market Commentary for May 16


A volatile session into the afternoon which was proceeded by mostly slow moving trading action from the morning session on. Overall, the major indices were in the hands of the Bulls, into the closing bell. At the closing bell, here is how the major indices ended the session: the DOW (Dow Jones Industrial Average) moved posted a triple digit gain by 103.69 points to end the session at 13,487.53; the NYSE
(New York Stock Exchange) gained 60.88 points to end at 9,825.61; the NASDAQ posted a gain of 22.13 points today for a close at 2,547.42; the S&P 500 moved higher by 12.95 points to end at 1,514.14 and the RUSSELL 2000 moved higher by 6.02 points to close at 820.20. The FTSE All-World Index ex-US (top Large/Mid Cap aggregate from over 2,700 stocks from the FTSE Global Equity Index Series (GEIS) which covers 90% of the worlds investable market capitalization) moved higher by 0.50 to close at 257.84 and the FTSE RAFI 1000 moved higher by 41.15 to close at 6,351.21.

President of the Federal Reserve Bank of Dallas, Richard W. Fisher commented today: globalization raises economies' speed limits; services sector drives U.S. economy; globalization gathering in intensity; U.S. must stay at fore of information age and globalization optimizes operations.

Donald L. Kohn, Member of the Federal Reserve Board of Governors commented today: market innovation has improved economic resilience.

Randall S. Kroszner, Member of the Federal Reserve Board of Governors commented today: more globalization means flat yield curves.

President of the Federal Reserve Bank of New York, Timothy F. Geithner: there are limits to market transparency.

President of the Federal Reserve Bank of Kansas City, Thomas M. Hoenig commented late yesterday: Monetary Policy 'Modestly Firm'; Federal deficit needs to come down; monetary policy 'modestly firm' ; must be mindful of higher energy costs on inflation; export sector has a very good outlook; should see continued decline in inflation; should see 'slight' unemployment increase; labor markets remain relatively strong; housing has had effect on economy; economy over last year has been slowing and we will see economy strengthen this year.

President of the Federal Reserve Bank of New York, Timothy F. Geithner commented late yesterday: will take longer to fix equity derivative trades; does not address U.S. rate, economic outlook; good rate policy can mitigate asset mismatches; future shocks likely rarer, but more dangerous; markets may not stay this placid in future; global economy seeing stable growth, low inflation; recent markets defined by low volatility and Regulators should improve market shock absorbers.

Economic data released for the day:

MBA Purchase Applications: Compilation from the Mortgage Bankers’ Association of various mortgage loan indexes. This data is the leading indicator for single-family home sales as well as, housing construction. MBA Purchase Applications data released today: U.S. MBA Market Index falls 0.8% to 675.5 from 680.7; U.S. MBA Purchase Index falls 1.4% to 432.3 from 438.3 and U.S. MBA Refinancing Index rises 0% to 2115.5 from 2115.2.

Housing Starts: A monthly measure of initial construction of new homes, single family residential units and multi family units as released by the Commerce Department. A rising trend indicates an increase in demand for home furnishings, appliances and furniture. Housing Starts data released today: U.S. April Housing Starts rose by 2.5% to 1.528 Million compared to consensus of a drop by 2.2%; Building Permits fell by 8.9% to 1.429 Million rate in April and March Housing Starts were revised to an increase by 0.3% from a rise by .0.8%

Industrial Production: The physical output of the nation’s factories, utilities and mines. The Industrial sector accounts for less than one fifth of the economy with a mostly cyclical variation. The usage of available resources amount utilities, mines and factories is the capacity utilization rate. A warning sign of inflationary pressure is detected by an increase operating rate. Industrial Production data released today: U.S. April Industrial Production rose by 0.7% compared to consensus of 0.3%; U.S. April Capacity Utilization rose by 0.4 points at 81.6% compared to consensus of 81.5%; U.S. March Industrial Production was revised to a drop of 0.3% from a drop of 0.2% and U.S. March Capacity Use was revised to 81.2% from 81.4%.

EIA Petroleum Status Report: EIA (Energy Information Administration) provides weekly petroleum inventories in the United States whether they are produced here or abroad. Prices for petroleum products are determined by the level of inventories. Petroleum Status report released today for week of May 11th, crude oil inventories came in at 1.0 Million Barrels.

Commodities Markets

The trend was mostly lower across the board today for the Energy Sector: Light crude moved lower by $0.77 today to close at $62.40 a barrel; Heating Oil moved lower by $0.03 again today to close at $0.03 a gallon; Natural Gas closed with no change at $8.02 per million BTU and Unleaded Gas moved higher by $0.04 to close at $2.33 a gallon.

Metals Market ended the session lower across the board today: Gold moved sharply lower by $13.00 to close at $661.50 an ounce; Silver moved lower by $0.39 to close at $12.93 an ounce; Platinum moved sharply lower today by $13.80 to close at $1,325.80 an ounce and Copper ended the day lower by $0.11 today to end at $3.42 per pound.

On the Livestock and Meat Markets, the trend was mixed across the board yet again today: Lean Hogs closed with higher by 1.25 to close at 74.88; Pork Bellies ended the day lower by 0.68 to close at 103.60; Live Cattle moved lower by 0.30 to end the day at 92.73 and Feeder Cattle ended the day higher by 0.25 today to close at 113.10.

Other Commodities: Corn moved higher again today for a gain of 5.00 points to end at 376.50 and Soybeans posted another nice gain today of 14.75 to close at 792.75.

The e-mini Dow ended the session higher by 88 points to close at 13526. The total Dow Exchange Volume for the day came in at 250,039 which are comprised of Electronic, Open Auction and Cash Exchange. Traders should review workshops available at the CBOT (Chicago Board of Trade) Educational in-person seminars schedules available on CBOT (Chicago Board of Trade) website.

Bonds were mostly lower across the board again today: 2 year bond closed with no change at 99 18/32; 5 year bond closed lower by 1/32 at 99 14/32; 10 year bond closed lower by 1/32 at 98 11/32 and the 30 year bond closed lower by 1/32 at 98.

The end of day results for the CBOT (Chicago Board of Trade) which is comprised of the total Exchange Volume for Futures and Options (EVFO) including Electronic, Open Auction and Cash Exchange ended the day at 4,380,834; Open Interest for Futures moved higher by 174,902 points to close at 10,336,273; the Open Interest for Options moved higher by 73,248 points to close at 7,520,679 and the Open Interest for OTC had no change to close at 4,934 for a total Open Interest of 17,861,886 for a total gain on the day by 248,150.

On the NYSE today, advancers came in at 2,011; decliners totaled 1,206; unchanged came in at 157; new highs came in at 195 and new lows came in at 33. Gainers and losers for the day on the NYSE: Copa Holdings S.A. (CPA) moved nicely higher on the Big Board today for a nice gain of 10.23% for a climb of 6.30 points to end the trading day at $67.89; Rio Tinto plc (RTP) posted a gain today of 7.57 points to close at $283.82; Terra Nitrogen Company L.P. (TNH) posted a rebound on the trading day by moving higher by 4.84 points to close at $82.74; Bausch & Lomb Incorporated (BOL) climbed higher today by 6.00 points to close at $67.50; NVR Incorporated (NVR) moved higher on the trading session by a whopping 26.88 points to end the trading day at $786.13 and Uniao de Bancos Brasileiros SA (UBB) moved higher today for a gain of 5.99 points to close at $109.41.

On the NASDAQ today, advanced totaled 1,792 decliners totaled 1,236; unchanged came in at 156, new highs came in at 97 and new lows came in at 107. Gainers and losers for the day on the NASDAQ: InfoSpace Incorporated (INSP) fell sharply on the trading session for a loss of 24.36% to shed 5.99 points to end the trading day at $18.60; East Penn Financial Corporation (EPEN) rallied higher on the trading day for a nice gain of 66.87% to move higher by 5.41 points to close at $13.50; Google Incorporated (GOOG) tacked on a gain of 14.49 points to end at $472.44 and Kaiser Aluminum Corporation (KALU) gave up 3.52 points to close at $76.00.

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Millennium-Traders