Markets were very quiet on the day. The VIX was up slightly over 2% while stocks were essentially flat. The market continues to have the same very bullish feel it has had since the March low. On the other hand, this was the first Monday in quite a while where the market didn’t soar higher. Daily Futures wraps up the quiet action:
U.S. Economy
According to MasterCard Advisors SpendingPulse, retail sales from November 1 to Christmas eve were up 3.6% from a year ago, better than expected. The March 2011 eurodollars are steady to lower.
The Chicago Federal Reserve’s regional index of manufacturing increased from 83.2 to 84.2 in November, the highest in eleven months.
The Dallas Federal Reserve’s index of regional activity increased from .3 to 3.8 in December.
The U.S. Treasury sold $44 billion of two-year T-notes at a median yield of 1.04% and a bid to cover ratio of 2.91. The March U.S. T-bonds are steady to lower.
Grains and Cotton
The USDA said that last week’s export inspections of:
Corn totaled 27.1 million bushels, up 12% from a year ago.
Soybeans totaled 51.9 million bushels, up 55% from a year ago.
Wheat totaled 10.7 million bushels, up 133% from a year ago.
March soybeans finished up 30 cents at $10.38, the highest close in a week.
March wheat jumped up 26.25 cents to $5.507 with concerns about severe winter weather in the central plains and its effect on the winter wheat crop.
The latest U.S. winter storm also makes it more difficult to harvest the final 5% of the corn crop that the USDA says is still out in the fields. March corn closed up 7.5 cents at $4.16, the highest close in three weeks.
Livestock
The USDA is scheduled to release its quarterly hogs and pigs inventory report on Wednesday afternoon. February hogs closed up .90 at 64.70.
Orange juice
Temperatures should remain safely above freezing in central Florida for the rest of this year, but there is a chance that the thermometer may dip below freezing on Saturday morning. March orange juice finished up 3.10 cents at $1.3840.
Energies
Sunday’s 6 to 10 day forecast from the National Weather Service is expecting below-average temperatures for the eastern third of the U.S. February natural gas is trading higher.
Metals
March copper closed up 4.40 cents at $3.365, the highest close in sixteen months, helped by strong demand from Asia and low global interest rates.
Currencies
Japan’s Statistics Bureau said that the unemployment rate increased from 5.1% to 5.2% in November, as expected. Consumer prices were down 1.9%, but household spending was up 2.2% in November from a year ago. Also, factory orders were up 2.6% in November, the ninth consecutive gain. The March Japanese yen is steady.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.