Mid-month Rebalance Catches The Shorts With Their Pants Down, Tech
MrTopStep | Aug 16, 2017 01:01AM ET
War or, no war? The war drums seem to be quieting down, and the stock market is going back up. The PitBull said ‘It’s the 14th and the they are putting money back to work’. By ‘they’ he means the big investment / etf mutual funds. When there was talk of ‘back channel talk’ going on between the U.S. and North Korea last Friday, the markets firmed up, but when Asia started to rally Sunday night, and the ES was up 10 handles, it was obvious that at least for now, last week’s dark clouds were moving away. Does the rally mean it’s all over? No, but it does seem like cooler heads are prevailing… At least for now.
Yesterday, on the 8:30 CT futures open, the S&P 500 futures (ESU17:CME) traded 2454.50, on a total of 227,000 contracts traded on Globex. At 9:50 CT, the ES traded 2460.25, pulled back a little, and then made two more highs at 2462.25. At 11:40am CT, volume was at 840,000, but the overall trade was a grind. Most of the buying was traders that hedged positions. From 10:30 CT time to 1:45, the ES was stuck in a 2.75 handle range. Around 2:00 the ES sold off down to 2461.00, when the MiM started showing over $440 million for sale, but the ES popped right back up to 2465.50 going into 2:30 CT.
From the 11:00 high 2466.75 to its low before 2:00, the day’s total trading range was 5.5 handles. At 2:45 the final MOC came out showing $150 million to sell. Tech and financial stocks led the way. Morgan Stanley (NYSE:MS) and Goldman Sachs (NYSE:GS) both gained more than 1%, and Nymex crude (CLU17:NYMEX) fell 2.5%, to $47.59, its largest one-day slide since July 7.
h2 S&P Post Its Largest Gain Since April/h2In the end it was a dead day. The S&P 500 futures (ESU17:CME) settled at 2463.50, up +23.50 handles, or +0.95%, the Dow Jones futures (YMU17:CBT) settled at 21952, up +104 points, or +0.47%, and the Nasdaq 100 futures (NQU17:CME) settled at 5910.00, up +71.75 points, or +1.21%.
h2 While You Were Sleeping/h2
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Overnight, equity markets in Asia traded mostly higher, led by the NIKKEI, which closed up +1.11%. The strength in Asia followed through into the European session, where most markets are also trading higher this morning.
In the U.S., the S&P 500 futures opened last nights Globex session at 2469.50, and immediately the overnight low at 2462.50. From there, the ES began trading higher, printing the overnight high of 2473.25 at 8:30pm CT. Since then, the futures have been drifting sideways in an 8 handle range. As of 6:45am CT, the last print in the ES is 2469.00, up 5.50 handles, with 155k contracts traded.
In Asia, 9 out of 11 markets closed higher (Shanghai +0.44%), and in Europe 9 out of 12 markets are trading higher this morning (FTSE +0.58%).
Today’s economic calendar includes Retail Sales (8:30 AM ET), Empire State Manufacturing Survey (8:30 AM ET), Import and Export Prices (8:30 AM ET), Business Inventories (10:00 AM ET), Housing Market Index (10:00 AM ET).
h2 Dow Has Gone 61 Sessions Without a 1% Move; Longest Since 1995/h2Our View: Boy… just like Sunday night. I look at the ES, and its trading higher, 2470.00 last, up 6.5 handles, and only 17 handles off its all time high. Its astonishing how in one day the news headline sell offs can’t hold the markets down. The S&P takes bad news, and makes good of it. The VIX dropped 21% yesterday, and 7% Friday. Our view is that you can sell the early rally, or just wait for a pull back, and buy it!
PitBull: CLU osc -14/10 turns up on a close above 48.56; ESU osc -27/1 turns up on a close above 2425.53; VIX osc 40/10 turns up on a close above 18.27.PitBull: CLU osc -14/10 turns up on a close above 48.56; ESU osc -27/1 turns up on a close above 2425.53; VIX osc 40/10 turns up on a close above 18.27.
Market Vitals for Tuesday 08-15-2017
- In Asia 9 out of 11 markets closed higher: Shanghai Comp +0.44%, Hang Seng -0.28%, Nikkei +1.11%
- In Europe 9 out of 12 markets are trading higher: CAC +0.54%, DAX +0.33%, FTSE +0.58%
- Fair Value: S&P -1.24, NASDAQ +3.20, Dow -30.32
- Total Volume: 1.46mil ESU, and 970 SPU traded in the pit
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