The CRB Index looks ready to break a key support level which has held twice at around 293. The index is heavily weighted with crude oil, which experienced an ugly reversal and was down over 6 percent last week.
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You think this is why markets have bounced and are so sanguine about the European elections? We’re not so sure the European street can be dismissed that easily.
“In 1981, François Mitterrand had one-and-a-half years to correct his Socialist course. Hollande only has until he takes office.” — Elmar Brok, German MEP
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Was last night’s incredible shot of the Super Moon rising over the Parthenon in Athens a bad omen of things to come? Some see a bad moon rising given the results of today’s elections in Greece and France. Buckle up!
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The weak jobs report has crushed equities this morning.
Here’s the BLS take,
Nonfarm payroll employment rose by 115,000 in April, and the unemployment rate was little changed at 8.1 percent, the U.S. Bureau of Labor Statistics reported today. Employment increased in professional and business services, retail trade, and health care, but declined in transportation and warehousing.
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More good stuff from the Milken Institute Global Conference. A panel discussion on the future of the global economy, which includes one of our favorite economists and our favorite historian.
The Future of Capitalism
Monday, April 30, 2012
11:00 AM – 12:00 PM
Speakers:
Niall Ferguson, Laurence A. Tisch Professor of History, Harvard University; Senior Fellow, Hoover Institution
Ana Palacio, Member, Spanish Council of State; former Minister of Foreign Affairs, Spain
Peter Passell, Senior Fellow, Milken Institute; Editor, The Milken Institute Review
Raghuram Rajan, Eric J. Gleacher Distinguished Service Professor of Finance, University of Chicago Booth School of Business
Moderator:
James McCaughan, CEO, Principal Global Investors
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Noisy markets. Noisy data.
Buckle up for tomorrow’s big one.
Today’s action was just the opposite of our May Day post when shorts got their manhood caught in a bear trap. Though we believe markets are a little too complacent of event risk — European political risk, end of Operation Twist, U.S. “Fiscal Cliff”, China uncertainty, etc. — it does feel they’re trying to carve out a trading range for what we expect to be a choppy summer.
Today’s low on the S&P500 was a few points above the 50-day moving average at 1386.53. If jobs disappoint, watch the 1360 area, which was last week’s low.
We have little exposure and confess our ignorance.
Nevertheless, here’s the ISM on today’s data,
INDUSTRY PERFORMANCE
The 15 non-manufacturing industries reporting growth in April — listed in order — are: Retail Trade; Information; Construction; Management of Companies & Support Services; Arts, Entertainment & Recreation; Educational Services; Finance & Insurance; Accommodation & Food Services; Wholesale Trade; Real Estate, Rental & Leasing; Transportation & Warehousing; Other Services; Public Administration; Professional, Scientific & Technical Services; and Health Care & Social Assistance. The three industries reporting contraction in April are: Agriculture, Forestry, Fishing & Hunting; Utilities; and Mining.
WHAT RESPONDENTS ARE SAYING …
- “Sales have improved slightly, yet still lag behind pre-recession highs. The hiring freeze has been lifted, but open positions are still being vetted for need, timing of the fill, and so forth.” (Public Administration)
- “Business conditions have improved in March and April 2012. We have received more job inquiries and job awards in this period. The increase is about 15 percent.” (Professional, Scientific & Technical Services)
- “Current conditions compared to prior year are good. Fuel and food continue to be a challenge.” (Arts, Entertainment & Recreation)
- “Business is slowing — and projections for the rest of the year are being lowered.” (Professional, Scientific & Technical Services)
- “Business is still ahead of last year, but has leveled off a little.” (Wholesale Trade)
- “High price of petroleum/oil driving up costs for all market areas.” (Transportation & Warehousing)
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