[转贴] February 17, 2014 Weekend Update

沁颍

Despite weak economic news, equities rose notably this past week. At the start of the week, shares were down in early trading but managed to shed losses and end the day slightly higher as investors waited for testimony from Federal Reserve Chair Janet Yellen.  Prior Friday’s employment numbers continued to weigh on stocks on Monday.  On Tuesday, stocks rallied significantly as the House of Representatives approved legislation that extends Treasury’s borrowing authority.  Also, Federal Reserve Chair Janet Yellen in testimony before the House of Representatives said she would not make any changes to the Fed’s “measured steps” schedule for reducing its stimulus. Negative retail sales were once again trumped as stocks finished the week on a high note.  Weather and poor economic data proved that bad news is good news again. Equities were up notably this past week. The Dow and the S&P 500 were both up 2.3%. The tech-heavy Nasdaq finished the week up 2.9% and the market-leading Russell 2000 also finished up 2.9%.



The CBOE volatility index (VIX) fell sharply again this past week as equities rallied.  The ‘Fear Gauge’ is now back down to the $13.5 level after giving up 11%.  Rising equity prices and low volume contributed to little option buying by traders. Cheap protection for any market sell-off is abundant as stocks and investors continue to show little signs of worry.



Most Treasury yields ended the week up modestly.  Bond traders, however, interpreted Fed Chair Yellen’s comments differently than equity traders.  After little change Monday, rates firmed moderately Tuesday after Fed Chair Yellen stated in Congressional testimony that quantitative easing will continue in measured steps after each FOMC meeting unless exceptional data indicate otherwise.  Yellen’s testimony continued to impact yields as bond prices remained firm.  We expect some divergence between stocks and bonds but they have recently both been trending higher in tandem. Gold futures (/GC) shot higher this week on little news.  Inflation remains muted so speculators are most likely looking at commodity prices rising due to Fed decisions and actions.



The economy is off to a lackluster start as consumer spending is taking its toll on data.  Much of the downbeat economic data is being blamed on the weather but it will have a negative effect on growth estimates going forward. Housing and inflation numbers are in the spotlight this week.  Housing sales have wavered but homebuilders have been a little optimistic despite firming in mortgage rates.  Updates are to be posted for NAHB housing market index, housing starts, and existing home sales.  Inflation at the producer and consumer level has been subdued, allowing the Fed to keep policy loose. We get news at both levels this week. But for the PPI, the composition of the index has been reformulated to include services and construction. There will also be more earnings this week led by quarterly results from Coca-Cola (KO) and Wal-Mart (WMT).



Major Earnings for the Upcoming Week:

Monday: N/A



Tuesday: ADI, CF, FLR, HLF, KO, MDT, NI, PNRA, WM, WWW                     



Wednesday: CAR, CROX, DVN, GRMN, MGM, SIX, SWY, TSLA, WMB



Thursday: AGU, DANA, DTV, ESRX, GRPN, HPQ, INTU, MRVL, NEM, PCLN, WMT



Friday: BCC, CHTR, DISH



Economic Release (2/18-2/21):

Monday:

N/A



Tuesday:

7:30 am CT – Empire State Mfg Survey

8:00 am CT – Treasury Intl. Capital

9:00 am CT – Housing Market Index



Wednesday:

6:00 am CT - MBA Purchase Applications

6:45 am CT – GS Store Sales

7:30 am CT – Housing Starts

12:00 pm CT – Fed’s Bullard Speaks

1:00 pm CT – FOMC Minutes



Thursday:

7:30 am CT – Consumer Price Index (CPI)

7:30 am CT – Weekly Jobless Claims

7:58 am CT – PMI Mfg. Index Flash

9:00 am CT – Philly Fed Survey

9:00 am CT – Leading Economic Indicators

10:00 am CT – Oil Inventories



Friday:

9:00 am CT – Existing Home Sales

12:10 pm CT – Fed’s Bullard Speaks

西门吹雪

aimei

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