Friday, December 4, 2009

Morning Note...

Apologies for limited note today…

Futures surge up 140bps following this morning’s employment data.  The official Change in Nonfarm Payrolls was only -11k versus the -150k expectation.  Additionally, the Unemployment Rate dropped to 10% even from 10.2%.  October’s data was also revised for the better, to -111k from -190k observed.  Also of note – the “real” Unemployment Rate, which includes discouraged workers and individuals working part-time, fell from 17.5% to 17.2%... Further, to this point in the morning, the inverse correlation between the USD and the SPX appears broken, as the dollar surges +50bps and S&P futures are higher as well.  In corporate news, the largest secondary offering in nearly a decade priced last night, as BAC’s $19.3B priced at $15.  In global news, the Canadian unemployment data was also much better-than-expected, as they added 79k jobs, which was 5x the expectation. 

As of last night’s close, the DJIA is only 27% below the all-time high (14,000+) set in late 2007.  I am admittedly surprised by that number.  Given what we know now about the excess risk-taking and leverage then, would you expect that number to be higher or lower?  This is an oversimplification of course, but does trimming 27% of excess fat from the “golden age” of credit represent fair value?  Hmm.  I would argue that we’d need to trim more from that time’s excesses – both financial and otherwise – to achieve fair value in fundamental economic terms. 


Asia mixed overnight.  Europe up over 1% on average.  USD +50bps.  Gold -2%.  Oil +135bps. 

Brightpoint News

Brightpoint PreMarket (yest close/premkt/% change/volume):

S&P 500 PreMarket (last/% change prior close/volume): 
BIG LOTS INC                 26.80    +13.85%           214234
GOODYEAR TIRE            14.38    +5.27%             50521
SUN MICROSYSTEMS     8.63      +4.86%             7707681
AKAMAI TECH                24.92    +4.84%             36250
MGIC INVT CORP            4.85      +4.75%             50010
MBIA INC                       3.80      +3.83%             40662
REGIONS FINANCIA        5.70      +3.64%             162703
KEYCORP                       6.07      +3.58%             12136
GENWORTH FINANCI      11.70    +3.54%             22024
MARSHALL &ILSLEY        5.65      +3.48%             4500
GANNETT CO                 10.19    +3.45%             200
FANNIE MAE                  .930      +3.33%             110784
PROLOGIS                     13.64    +3.02%             4336
ZIONS BANCORP            12.97    +3.02%             9189

Today’s Trivia:  Who has won the World Cup the most times, and – for the bonus points – what years?  (Submitted by Adrian VDB, who claimed my US States question was too “provincial.”)

Yesterday's Answer:  “Live Free or Die” = New Hampshire… “Fatti maschii, parole femine (Manly deeds, womanly words)” = Maryland… “Excelsior” = New York… “Oro y plata (Gold and Silver)” = Montana

Best Quotes:   “In the standoff between shoppers who are looking for great deals and retailers who have slashed inventory to boost sales of full-price merchandise, it looks like the shoppers won in the month of November; as evidenced by the lower-than-expected same-store sales at major retailers.”  -WSJ

No comments:

Post a Comment