Stocks shrugged off weak economic data as stocks surged 1% higher today. A brief rally in the dollar was quickly sold into and stocks took their usual cue to move anti-dollar. The VIX took a 7% hit as investors poured out of the hedged trade they had placed just yesterday. The rally was broad based and led mainly by the financials which finished the day with gains of 2.5%. Volume was moderate. Daily Futures has all the action:
The U.S. Labor Department said that jobless claims were up 11,000 last week to 531,000, more than expected. The December 2010 eurodollars ended up .035 at 98.33.
The Conference Board said that its index of leading indicators was up 1.0% in September, the sixth consecutive monthly increase and the highest level since October of 2007.
The Federal Housing Finance Agency said that U.S. home prices were down .3% in August and down 3.6% from a year ago.
The U.S. Treasury said that it will sell a record high $123 billion of T-notes and “inflation-protected” debt next week. The December 30-year T-bonds were down 5/32nds at 119.20/32nds.
Grains and Cotton
The USDA said that, as of last week, 2009-2010 exports of:
Corn fell from up 16% to up 12% from a year ago.
Soybeans fell from up 32% to up 11% from a year ago.
Wheat improved from down 36% to down 35% from a year ago.
Cotton remained down 31% from a year ago.
Heavy rain continues to fall throughout the Midwest and on the Mississippi River Delta, making the harvest difficult for corn, soybeans, and cotton. December cotton was lower most of the day, but ended up .17 at 68.55.
The USDA said that net sales of beef totaled 7,100 tons last week, down from 8,500 tons the previous week and the lowest in three months. December cattle were up .30 at 87.37.
After the close, the USDA said that there were 531.9 million pounds of frozen pork in storage on September 30th, up 1% from a year ago. Frozen bellies totaled 38.3 million pounds, up 80% from a year ago. December hogs closed up .05 at 53.72.
After the close, the USDA said that there were 1.22 billion pounds of frozen orange juice concentrate in storage on September 30th, up 2% from a year ago. January orange juice closed down 3.20 cents at $1.1755.
China’s Statistics Bureau said that real GDP was up 8.9% in the third quarter from a year ago, roughly as expected, but also the most growth in a year. Will the government now reduce its stimulus plans? December copper fell 3.80 cents to $2.9980.
The U.S. Department of Energy said that natural gas supplies were up 18 billion cubic feet last week to 3.734 trillion cubic feet (tcf) – near the estimated maximum of 3.890 tcf and up 12% from a year ago. December natural gas fell 17.6 cents to $5.617.
This afternoon’s 6 to 10 day forecast from the National Weather Service is still expecting below average temperatures and above average precipitation for the eastern half of the U.S.
Statistics Canada said that retail sales totaled C$34.48 billion in August, up .8% on the month, but down 3.8% from a year ago – still stronger than expected.
The December Canadian dollar closed down .87 at 95.39 after the Bank of Canada warned again that “the high value of the Canadian dollar will act as a drag on demand for Canadian products.”
Source: Daily Futures
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.