Kenny Polcari
KennyPolcari.com
Stocks limped out of the gate yesterday....and no wonder really - Wednesday's action was exhausting - as they took 'em up at qtr end.....but the issue is - why did they take 'em up with such force? Well - let's discuss - was it really with force?
Stocks have been beaten up - and in some cases pretty badly...so it did not take that much to cause the rally that we saw...look - sellers have been fairly aggressive, asset managers that needed to clean out the closet have done so.....so when the bargain hunters came calling - there was not a whole lot of supply offered tight.....Sellers pulled back knowing that the buyers would need to spruce up their portfolio's by qtr end....and boom....it was off to the races....
But in the end - so many pointed out that stocks remain a bit skittish because of the continued uncertainty that permeates the conversation. Today - it's all about the NFP (Non Farm Payroll) report....what will it show and then what are ALL the implications that it may or may not create. On top of that - we were subjected once again to the 'talking heads'... and you gotta love this...
San Francisco Fed Pres Williams hit the talk show circuit yesterday telling us that he sees 'the central bank raising short term interest rates this year - perhaps as early as this month....' Oh, please put a sock in it....... I think the most entertaining part of his conversation is the fact that he tries to tell us that it was a 'close call in September'.....in fact it was a 'VERY close call'....and then we learn that Richmond Fed Pres Lacker was the lone dissenter at the September meeting.....He WANTED to raise rates, but was outvoted by 9 (nine) other FED officials - officials who wanted to wait for MORE data so that they had a 'better handle' on the state of the union..... So tell me - 9:1is defined as close in the hallowed halls of the Federal Reserve? And now he says that 'he would view October to be a completely live meeting'.....Live? OH....so that explains it....all these prior meetings have apparently been DEAD.
So today - we have to wait until 8:30 to see what the NFP report says.....now the expectation is for +200k jobs to be created....this is not bad, but not really good either....I mean really good would be +300k jobs.....but Williams also made it clear that investors should not expect that 'employers will continue to add a significant number of new jobs each month......' In fact he said:
"I'm just looking for steady, continuing improvement in the labor mkt....a gain in September above 100k or 150k jobs would be good to me'!
So there it is folks....is he trying to prepare us for a weaker number yet still emphasize the positive of this weaker number to somehow justify a move on rates? So - if we get a weak number we should then expect the FED to say - "It's all good....here we go...!"
Others seem to think that October is a no go, because there is no press conference scheduled for that day so that Janet won't be able to explain any action in 'great detail'.... Great detail??? The world is tired of all the detail.....Do we really need more detail? No, we need action, we need someone to put on a pair of pants and make a decision, we need someone to lead.....
Now - note that any of the rallies of late have not been really strong...and that is a bit concerning for so many.....it feeds right into the bear camp.... the 'sell the rally' mode is alive and well - vs. the 'buy the dip' mode which had worked for so long..... and September did a lot of damage to so many......and when you have hedge fund managers like David Einhorn, telling us that mkts have become 'acutely unfavorable' to his style of value investing or David Tepper of Appaloosa warning of dark days ahead....or Uncle Carl Icahn who suddenly realizes that the FED is behind the 8 ball and produces his own commercial warning of 'Armageddon' it does not really help the mood much.
In addition - yesterday we learned that the Atlanta Fed's GDP forecast model now suggests that 3rd Q GDP will be 0.9% - that's down from the 2nd Q 3.8%!
Geo-politics are now back in focus....and why not? Putin has begun bombing the US backed rebels in Syria......(Obama thinks he is bombing ISIS) and Iran is amassing troops along the Israeli border.....how long do you think that is gonna go on before Netanyahu 'fixes that'?
And with earnings just around the corner - and all the concern over the stronger dollar, weaker global economy, and weaker energy prices (issues that are NOT new and ones that we have beaten to a pulp) it makes sense that the mkt churns. All of this just give reason for pause.....There is nothing at the moment that screams - "You gotta BUY 'em!
This morning US futures are +7 - but like yesterday - will we see it fade as we move into the opening? Any rally will test the 1950 level.....a failed attempt at piercing this will send us lower again keeping us locked in the 1900/1950 range.
8:30 should give us a bit of a clue. An NFP report within the +190/220k range should be a non event.....The report will have to either miss big or surprise big to make any real difference at all... Pay attn to the futures action in the moments before the release to see what the 'boys are telling you'...
For this you need: fresh mozzarella cut into chunks, pine nuts, olive oil, chopped onion, Yukon gold potatoes, peeled and coarsely grated, water (or veggie stock), fresh escarole roughly chopped, s&p, golden raisins, soaked in hot water for 5 minutes then drained.
In a large pot - heat oil over medium-high heat. Add onion, reduce heat to med and cook, uncovered, stirring occasionally for about 10 mins…. Next add potatoes and cook, stirring occasionally, about 5 minutes more. Now add in the escarole and season with s&p.
Continue cooking, covered, stirring occasionally, until leaves are wilted and tender, about 10 minutes more; add 1 ½ cups water (or veggie stock) and bring to a simmer. Transfer contents of pan to a blender or food processor and purée until smooth; season with salt to taste.
When serving – add chunks of the fresh mozzarella, some toasted pine nuts and sweet raisins…..you can drizzle a bit more of the olive oil if you prefer…..
Buon Appetito.
Stocks have been beaten up - and in some cases pretty badly...so it did not take that much to cause the rally that we saw...look - sellers have been fairly aggressive, asset managers that needed to clean out the closet have done so.....so when the bargain hunters came calling - there was not a whole lot of supply offered tight.....Sellers pulled back knowing that the buyers would need to spruce up their portfolio's by qtr end....and boom....it was off to the races....
But in the end - so many pointed out that stocks remain a bit skittish because of the continued uncertainty that permeates the conversation. Today - it's all about the NFP (Non Farm Payroll) report....what will it show and then what are ALL the implications that it may or may not create. On top of that - we were subjected once again to the 'talking heads'... and you gotta love this...
San Francisco Fed Pres Williams hit the talk show circuit yesterday telling us that he sees 'the central bank raising short term interest rates this year - perhaps as early as this month....' Oh, please put a sock in it....... I think the most entertaining part of his conversation is the fact that he tries to tell us that it was a 'close call in September'.....in fact it was a 'VERY close call'....and then we learn that Richmond Fed Pres Lacker was the lone dissenter at the September meeting.....He WANTED to raise rates, but was outvoted by 9 (nine) other FED officials - officials who wanted to wait for MORE data so that they had a 'better handle' on the state of the union..... So tell me - 9:1is defined as close in the hallowed halls of the Federal Reserve? And now he says that 'he would view October to be a completely live meeting'.....Live? OH....so that explains it....all these prior meetings have apparently been DEAD.
So today - we have to wait until 8:30 to see what the NFP report says.....now the expectation is for +200k jobs to be created....this is not bad, but not really good either....I mean really good would be +300k jobs.....but Williams also made it clear that investors should not expect that 'employers will continue to add a significant number of new jobs each month......' In fact he said:
"I'm just looking for steady, continuing improvement in the labor mkt....a gain in September above 100k or 150k jobs would be good to me'!
So there it is folks....is he trying to prepare us for a weaker number yet still emphasize the positive of this weaker number to somehow justify a move on rates? So - if we get a weak number we should then expect the FED to say - "It's all good....here we go...!"
Others seem to think that October is a no go, because there is no press conference scheduled for that day so that Janet won't be able to explain any action in 'great detail'.... Great detail??? The world is tired of all the detail.....Do we really need more detail? No, we need action, we need someone to put on a pair of pants and make a decision, we need someone to lead.....
Now - note that any of the rallies of late have not been really strong...and that is a bit concerning for so many.....it feeds right into the bear camp.... the 'sell the rally' mode is alive and well - vs. the 'buy the dip' mode which had worked for so long..... and September did a lot of damage to so many......and when you have hedge fund managers like David Einhorn, telling us that mkts have become 'acutely unfavorable' to his style of value investing or David Tepper of Appaloosa warning of dark days ahead....or Uncle Carl Icahn who suddenly realizes that the FED is behind the 8 ball and produces his own commercial warning of 'Armageddon' it does not really help the mood much.
In addition - yesterday we learned that the Atlanta Fed's GDP forecast model now suggests that 3rd Q GDP will be 0.9% - that's down from the 2nd Q 3.8%!
Geo-politics are now back in focus....and why not? Putin has begun bombing the US backed rebels in Syria......(Obama thinks he is bombing ISIS) and Iran is amassing troops along the Israeli border.....how long do you think that is gonna go on before Netanyahu 'fixes that'?
And with earnings just around the corner - and all the concern over the stronger dollar, weaker global economy, and weaker energy prices (issues that are NOT new and ones that we have beaten to a pulp) it makes sense that the mkt churns. All of this just give reason for pause.....There is nothing at the moment that screams - "You gotta BUY 'em!
This morning US futures are +7 - but like yesterday - will we see it fade as we move into the opening? Any rally will test the 1950 level.....a failed attempt at piercing this will send us lower again keeping us locked in the 1900/1950 range.
8:30 should give us a bit of a clue. An NFP report within the +190/220k range should be a non event.....The report will have to either miss big or surprise big to make any real difference at all... Pay attn to the futures action in the moments before the release to see what the 'boys are telling you'...
Escarole Soup
So today I am thinking soup…..It's going to be a cold rainy weekend here in the tri state region so try this won't you? This is a great dish, not only do you get the escarole but you get fresh mozzarella, toasted pine nuts and sweet raisins…..Come on now….how good does this sound?For this you need: fresh mozzarella cut into chunks, pine nuts, olive oil, chopped onion, Yukon gold potatoes, peeled and coarsely grated, water (or veggie stock), fresh escarole roughly chopped, s&p, golden raisins, soaked in hot water for 5 minutes then drained.
In a large pot - heat oil over medium-high heat. Add onion, reduce heat to med and cook, uncovered, stirring occasionally for about 10 mins…. Next add potatoes and cook, stirring occasionally, about 5 minutes more. Now add in the escarole and season with s&p.
Continue cooking, covered, stirring occasionally, until leaves are wilted and tender, about 10 minutes more; add 1 ½ cups water (or veggie stock) and bring to a simmer. Transfer contents of pan to a blender or food processor and purée until smooth; season with salt to taste.
When serving – add chunks of the fresh mozzarella, some toasted pine nuts and sweet raisins…..you can drizzle a bit more of the olive oil if you prefer…..
Buon Appetito.
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