TheStrategyLab.com Price Action Trading Support Forum

Trade Results of M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Price Action Trading (no technical indicators)
Phone: +1 708 572-4885
Free Chat Room: http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164
Business Hours: 8am - 5pm est (Mon - Fri)
questions@thestrategylab.com (24/7)
http://twitter.com/wrbtrader (24/7)


click on the above image to view today's performance verification

Price Action Trade Performance for Today: Emini TF ($TF_F) futures @ $210.00 dollars or +2.10 points, Emini ES ($ES_F) futures @ $0.00 dollars or +0.00 points, Light Crude Oil CL ($CL_F) futures @ $0.00 dollars or +0.00 points, Gold GC ($GC_F) futures @ $0.00 dollars or +0.00 points and EuroFX 6E ($6E_F) futures @ $0.00 dollars or +0.0000 ticks. Total Profit @ $210.00 dollars

Russell 2000 Emini TF Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ The ICE
S&P 500 Emini ES Futures: 1 tick or 0.25 = $12.50 dollars and there's more contract information @ CMEGroup
Light Crude Oil CL (WTI) Futures: 1 tick or 0.01 = $10.00 dollars and there's more contract information @ CMEGroup
Gold GC Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ CMEGroup
EuroFX 6E Futures: 1 tick or 0.0001 = $12.50 dollars and there's more contract information @ CMEGroup

In addition, all of my trades were posted real-time in the timestamp ##TheStrategyLab chat room. You can read today's price action trading information about my trades (e.g. time, price entry, contract size, price exit) as the trade traversed to its completion. Also, sometimes I'll post real-time trading tips involving WRBs, WRB Hidden GAPs, Key Market Events (KME), Tutorial Chapters 2 & 3, WRB Zones, Reaction Highs/Lows, Contracting Volatility or Expanding Volatility. Its all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=133&t=1872


Also, posted below are direct links to information about my price action trade methodology and trading plan (there's a difference between the two) that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body/bar analysis). I'm primarily a day trader because it suits my personal lifestyle but I do occasionally swing trade and position trade. Simply, my trade method is applicable for position trading, swing trading and day trading.

##TheStrategyLab Chat Room is free. Members and I use the chat room to post WRB Analysis commentary, real-time trades and to post anything else related to trading. The chat room helps me tremendously in my own trading because I use it to document (journal) general volatility analysis involving WRB Analysis so that I can easily review at a later date my thoughts as I interacted with the markets...info I can not get from my broker statements. Also, this is not a signal calling chat room where a head trader tells you when to buy or sell and I do not have the time/energy/resources to manage a signal calling chat room. Access instructions for chat room @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164

Price Action Analysis via WRB Analysis Tutorials @ http://www.thestrategylab.com/WRBAnalysisTutorials.htm and there's a free study guide of the WRB Analysis Tutorial Chapters 1, 2 and 3 @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=119&t=718

Trade Signal Strategies via Volatility Trading Report (VTR) @ http://www.thestrategylab.com/VolatilityTrading.htm and there's a free trade signal strategy @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=89 so that you can freely test drive one of our price action trade strategies with support (answering your questions) prior to purchasing the Volatility Trading Report (VTR).

Trading Plan Daily Routine @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=244&t=2455

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Market Context Summaries

The below summaries by Bloomberg, CNNMoney, Reuters and Yahoo! Finance helps me to do a quick review of the fundamentals, FED/ECB/BOE/IMF actions or any important global economic events (e.g. Eurozone, MarketWatch.com) that had an impact on today's price action in many trading instruments I monitor during the trading day. Simply, I'm a strong believer that key market events causes key changes in supply/demand and volatility resulting in trade opportunities (swing points and strong continuation price actions) that reach profit targets. Thus, I pay attention to these key market events, intermarket analysis (e.g. Forex EurUsd, EuroFX 6E futures, Gold GC futures, Light Crude Oil (WTI) CL & Brent Oil futures, Eurex DAX futures, Euronext FTSE100 futures, Emini ES futures, Emini TF futures, Treasury ZB futures and U.S. Dollar Index futures) while using WRB Analysis from one trade to the next trade to give me the market context for price action trading before the appearance of my technical analysis trade signals. Therefore, I maintain these archives to allow me to understand what was happening on any given trading day in the past involving key market events to help better understand my trade decisions (day trading, swing trading, position trading)...something I can not get from my broker statements alone. Further, most financial websites remove (delete) their archives after a few years to make room for new content. Therefore, I maintain my own archives of the news content so that I have it available for me when financial websites no longer archives their content.


click on the above image to view today's price action of key markets

Yahoo! Finance

4:10 pm: [BRIEFING.COM] The major averages ended the midweek session on a flat note after spending the day inside narrow ranges. The S&P 500 hovered near the 2,000 mark for the majority of the trading day, but slumped to new lows during the last hour of action. The index then returned to its flat line, where it settled for the day. For the third day in a row, participation left a lot to be desired with just 487 million shares changing hands at the NYSE.

Equity indices opened with slim gains, but were quick to return to their flat lines as most sectors traded little changed. Two countercyclical groups-telecom services (+0.5%) and utilities (+1.0%)-held gains throughout the day, but neither had much say over the direction of the broader market.

Meanwhile, influential sectors like consumer discretionary (+0.1%), financials (-0.2%), health care (unch), and technology (-0.1%) ended mixed with respect to the S&P 500.

Retailers contributed to the relative strength of the discretionary sector following better than expected quarterly results from Brown Shoe (BWS 29.90, -1.47), Express (EXPR 16.45, +1.86), and Tiffany & Co (TIF 101.75, +0.98). For its part, the SPDR S&P Retail ETF (XRT 89.47, +0.30) advanced 0.3%.

Elsewhere, the health care space displayed intraday strength, but finished in line with the market. Biotechnology contributed to the early outperformance, but the iShares Nasdaq Biotechnology ETF (IBB 275.06, -0.65) settled lower by 0.2% after soaring 9.6% over the past two weeks.

Similar to health care, the top-weighted sector-technology-also showed intraday strength prior to an afternoon retreat. Even though the sector ended in the red, its largest component-Apple (AAPL 102.13, +1.24)-climbed 1.2% amid speculation the company will reveal a wearable device at an event scheduled for September 9.

While equities ended little changed, there was some activity in the foreign exchange market. This morning, the euro/dollar pair jumped from 1.3170 to 1.3210 in reaction to reports suggesting the European Central Bank is unlikely to take action at next week's policy meeting. The comments were attributed to ECB sources and followed earlier speculation that ECB President Mario Draghi may announce a quantitative easing program at the upcoming meeting. The single currency traded near the 1.3195 level at the end of the New York session.

Treasuries settled near their highs with the 10-yr yield down four basis points at 2.36%. More notably, the 30-yr bond rallied to send its yield lower by six basis points to 3.11%, representing the lowest close since May of last year.

Economic data was limited to the weekly MBA Mortgage Index, which rose 2.8% to follow last week's uptick of 1.4%.

Tomorrow, weekly Initial Claims (Briefing.com consensus 302,000) and the second estimate of Q2 GDP (expected 4.0%) will be released at 8:30 ET, while the Pending Home Sales report for July (consensus 0.5%) will cross the wires at 10:00 ET.

Nasdaq Composite +9.4% YTD
S&P 500 +8.2% YTD
Dow Jones Industrial Average +3.3% YTD
Russell 2000 +0.7% YTD

3:35 pm: [BRIEFING.COM]

The dollar index remained in the red all day, which helped provide some price strength in select commodities
Crude oil climbed off its LoD to recover its losses earlier today. Oct crude finished 4 cents higher at $93.89/barrel
Natural gas traded in a similar way as well, ended the day 5 cents higher at $4.00/MMBtu
Gold consolidated after a mild sell-off and ended $1.90 lower at $1283.50/oz. Sept silver closed 2 cents higher at $19.41/oz
Sept copper lost 1 cent to $3.18/lb.

3:00 pm: [BRIEFING.COM] The S&P 500 trades lower by 0.1% with one hour remaining in today's forgettable session.

Today's economic data was limited to the weekly MBA Mortgage Index (+2.8%), but tomorrow will be a bit more busy, featuring the second estimate of Q2 GDP (Briefing.com consensus 2.0%), the Pending Home Sales report for July (consensus 0.5%), and weekly initial claims (consensus 302K).

Elsewhere, Treasuries are on their highs with the 10-yr yield down four basis points at 2.36%. More notably, the long bond has extended to a new high, pressuring its yield five basis points to 3.11%. The current level would represent the lowest close for the 30-yr yield since last May.

2:30 pm: [BRIEFING.COM] Since our last update, the S&P 500 has climbed from 1,999.90 all the way to 1,999.94. Despite that recent 'surge,' equity indices continue respecting very narrow trading ranges.

There hasn't been much change among the ten sectors, but technology has returned into the green after spending the bulk of the day in negative territory. Apple (AAPL 102.36, +1.47) has contributed to the turn of fortunes, trading higher by 1.5% amid speculation the company will reveal a wearable device at an event scheduled for September 9.

Chipmakers have also climbed to their best levels of the session with the PHLX Semiconductor Index up 0.2%.

2:00 pm: [BRIEFING.COM] For those who thought today's session could not get any slower, we have some news. It has. The S&P 500 has spent the past hour anchored to its flat line. Since our midday update, the benchmark index has held between 2,000.28 and 1,999.90.

Telecom services (+0.4%) and utilities (+0.4%) remain in the lead, while seven of the remaining eight sectors trade within 0.1% of their flat lines. The financial sector is the weakest performer at this juncture, down 0.2%.

Elsewhere, Treasuries remain bid with the 10-yr note higher by seven ticks and its yield down three basis points at 2.37%.

1:30 pm: [BRIEFING.COM] You have a choice: you could watch the stock market today or you could watch paint dry. It's tough to determine which would be more exciting. We'll give the nod still to watching the stock market, because that's what we love to do, yet anyone would be excused if they opted for other pursuits on this hump day.

The main point of interest today has arguably been the sovereign bond markets in the euro area. Yields there continue to come down, pushing record lows in many instances as the US stock market pushes record highs. The German bund, for example, is yielding 0.90% after starting the year around 1.95%. Deflation concerns, safe-haven flight, and speculation about a QE program being instituted in the euro area have been among the major influences driving yields lower.

The drop in yields in the eurozone, and the weakening euro, have raised the relative appeal of longer-dated Treasuries for European investors. Accordingly, the 10-yr note is up 8 ticks today and its yield is down three basis points to 2.37%.

On a related note, the $35 bln 5-yr note auction was decent with a 2.81x bid-to-cover, which exceeded the prior 12-auction average of 2.70, and a strong indirect bid that took down 52.7% of the supply compared to a 12-auction average of 45.7%.

12:55 pm: [BRIEFING.COM] Equity indices are little changed at midday with the S&P 500 hovering within a point of its flat line. Small caps underperform with the Russell 2000 trading lower by 0.2%.

The first two sessions of the week produced the lightest volume totals of the year so it was not surprising to see the key indices respect narrow ranges through the first half of action today. After opening on a slightly higher note, the S&P 500 has remained within two points of its flat line. Similarly, most sectors have held near their flat lines while countercyclical telecom services (+0.3%) and utilities (+0.6%) outperform.

Both sectors have held the lead since the start, but neither group holds much sway over the broader market as the two represent just over 5.0% of the S&P 500. Elsewhere among countercyclical sectors, health care (+0.2%) holds a modest gain amid relative strength in the biotech space. The iShares Nasdaq Biotechnology ETF (IBB 275.91, +0.20) is higher by 0.1%.

Outside of health care, the remaining influential sectors trade in mixed fashion. Technology (-0.1%) and financials (-0.1%) lag, while the consumer discretionary (+0.1%) holds a slim gain. Retailers have contributed to the modest uptick after Brown Shoe (BWS 30.04, -1.33), Express (EXPR 16.49, +1.90), and Tiffany & Co (TIF 102.25, +1.48) reported better than expected results.

Treasuries have spent the entire session in the green and they recently inched to new highs. The 10-yr yield is lower by three basis points at 2.37%.

Also of note, there has been some activity in the foreign exchange market. Earlier, the euro/dollar pair jumped from 1.3170 to 1.3210 in reaction to reports suggesting the European Central Bank is unlikely to take action at next week's policy meeting. The comments were attributed to ECB sources and followed earlier speculation that ECB President Mario Draghi may announce a quantitative easing program.

Economic data was limited to the weekly MBA Mortgage Index, which rose 2.8% to follow last week's uptick of 1.4%.

12:30 pm: [BRIEFING.COM] The major averages remain little changed. The S&P 500, which has spent the day inside a five-point range, has been trapped in a two-point range for the past hour.

Fittingly, just about every sector trades flat, while telecom services (+0.3%) and utilities (+0.7%) remain in the lead. Interestingly, both outperformers are among the weakest sectors of the month with the telecom services space down 1.9% month-to-date, while the utilities sector has added 2.7% this month.

12:00 pm: [BRIEFING.COM] Quiet action continues with the S&P 500 trading just above its flat line while the Russell 2000 (-0.2%) remains in the red.

All in all, the key indices have held up relatively well following two days of gains. The S&P 500 is higher by 0.6% for the week and up 3.6% in August with the final session of the month approaching on Friday. Meanwhile, the Russell 2000 has shown relative strength since the end of July. The small-cap index has added 1.2% this week and is up 4.9% in August.

On a side note, trading activity remains subdued with just 174 million shares having changed hands at the NYSE floor so far today.

11:30 am: [BRIEFING.COM] Equity indices continue hovering just above their flat lines with two countercyclical sectors-telecom services (+0.5%) and utilities (+0.5%)-in the lead. However, it is worth pointing out that the two groups constitute just over 5.0% of the entire S&P 500 index.

Meanwhile, top-weighted sectors trade in mixed fashion, keeping the S&P 500 close to its flat line. Financials (-0.1%) and technology (-0.2%), which represent 35.3% of the market, underperform, while consumer discretionary (+0.2%) and health care (+0.2%) hold slim gains. The two outperformers account for 25.7% of the entire market.

Elsewhere, Treasuries have returned into the neighborhood of their morning highs after a brief retreat during the past 90 minutes of action. The 10-yr yield is lower by three basis points at 2.37%.

11:00 am: [BRIEFING.COM] The major averages continue trading near their flat lines with the S&P 500 up a fraction of a point. Earlier, we speculated that today's session could produce a volume total to rival Monday's lowest total of the year (482 million) and that remains likely considering only 129 million shares have changed hands so far at the NYSE floor.

Although equities have not moved much, there has been some activity in the foreign exchange market. Specifically, the euro/dollar pair has jumped from 1.3170 to 1.3210 in reaction to reports suggesting the European Central Bank is unlikely to take action at next week's meeting. The comments were attributed to ECB sources and followed earlier speculation that the ECB would announce a quantitative easing program.

The dollar index (82.44, -0.21) slumped to a new low in reaction to the headlines.

10:35 am: [BRIEFING.COM]

Oct crude oil was near its HoD just ahead of the weekly inventory data
Following the data, Oct crude dropped back into negative territory and is now +0.1% at $93.97/barrel
Gold and silver dropped to new session lows earlier this morning. Both remain in the red, but just modestly lower.
Dec gold is now -0.2% at $1283.30/oz, Sept silver is -0.2% at $19.36/MMBtu
Natural gas has been in positive territory all day so far and is now +1.3% at $4.00/MMBtu
Note: Natural gas futures contracts rolled over into the October contract from September
Sept copper is -0.4% at $3.17/lb

10:00 am: [BRIEFING.COM] The market has surrendered its opening gains with the Russell 2000 (-0.3%) leading the key indices into the red. The S&P 500 hovers just below its flat line with energy (-0.2%), health care (-0.1%), and technology (-0.2%) exerting pressure on the market.

Furthermore, chipmakers weigh on the technology sector with the PHLX Semiconductor Index trading lower by 0.3%. Analog Devices (ADI 50.68, -1.53) is the weakest performer, down 3.0% following its in-line earnings on better than expected revenue.

On the upside, the utilities sector has extended its gain to 0.4%.

9:40 am: [BRIEFING.COM] Equity indices began the session in the green before returning to their flat lines. The S&P 500 hovers just north of its unchanged level with the utilities sector (+0.3%) showing early strength. Meanwhile, the remaining advancers trade within 0.1% of their respective flat lines.

On the downside, energy (-0.2%) and technology (-0.1%) hold slim losses.

Treasuries have inched away from their best levels of the day, but continue holding solid gains. The 10-yr yield is lower by three basis points at 2.37%.

9:13 am: [BRIEFING.COM] S&P futures vs fair value: +1.90. Nasdaq futures vs fair value: +3.00. The stock market is on track for a flat open with futures on the S&P 500 trading within two points of fair value.

Barring any unforeseen developments, today's session is setting up to be relatively quiet after the first two trading days of the week generated the two lowest volume totals of the year. Action overseas has also been subdued today with core European indices trading near their flat lines.

Market participants received a few quarterly reports, including better than expected results from Brown Shoe (BWS 31.80, +0.43), Express (EXPR 16.21, +1.62), and Tiffany & Co (TIF 103.25, +2.48). All three retailers are on track to begin the session in the green.

On the economic front, the weekly MBA Mortgage Index (+2.8%) was the lone data point of the day.

Treasuries are near their highs with the 10-yr yield down three basis points at 2.37%.

8:59 am: [BRIEFING.COM] S&P futures vs fair value: +0.70. Nasdaq futures vs fair value: +0.50. The S&P 500 futures trade within a point of fair value.

It was a sea of green across Asia as all of the major bourses, aside from Hong Kong's Hang Seng, finished in positive territory.

Economic data was limited:
Australia's Construction Work Done fell 1.2% quarter-over-quarter (expected -0.3%; prior -0.4%)
New Zealand's FPI slipped 0.7% month-over-month (prior 1.4%)
South Korea's Consumer Confidence rose to 107 from 105 (expected 104)

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Japan's Nikkei inched higher by 0.1% amid a muted trade. Exporters saw profit-taking as the yen firmed with Toyota Motor slipping 0.3%.
Hong Kong's Hang Seng lost 0.6% to continue its retreat from six-year highs. Casino shares were pressured after a tier 1 firm cut its outlook on the space. Galaxy Entertainment and MGM China both fell 1.5%.
China's Shanghai Composite ticked up 0.1%, gaining for the first time in three days. Automakers provided support with BYD rallying 2.0% following reports Beijing was considering funding to build electric car infrastructure.

Major European indices trade near their flat lines with Spain's IBEX (+0.2%) showing relative strength. Ukraine's President Petro Poroshenko said he will work on an urgent ceasefire plan following yesterday's meeting with Russian President Vladimir Putin in Minsk.

In economic data:
Germany's GfK Consumer Climate slipped to 8.6 from 8.9 (expected 9.0), while Import Price Index ticked down 0.4% month-over-month (consensus -0.1%; prior 0.2%)
French Business Survey slipped to 96 from 97, as expected
Italy's Consumer Confidence fell to 101.9 from 104.4 (consensus 104.0)

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In France, the CAC is lower by 0.1% with consumer names on the defensive. L'Oreal holds a loss of 1.3% and Danone trades down 0.5%. On the upside, financials BNP Paribas and Credit Agricole are higher by 1.0% and 1.3%, respectively.
In Germany, the DAX holds a loss of 0.1%. Exporters are among the laggards with BMW, Daimler, and Volkswagen down between 0.4% and 1.0%. Commerzbank and Deutsche Bank outperform with respective gains of 2.3% and 1.9%.
Great Britain's FTSE holds a slim gain of 0.1%. Petrofac leads with an increase of 3.6% after its latest earnings report showed a record order backlog.
Spain's IBEX outperforms with a gain of 0.2% amid strength in financials. Bankinter, Banco Popular, and Banco Sabadell are up between 0.9% and 1.7%.

8:29 am: [BRIEFING.COM] S&P futures vs fair value: +2.30. Nasdaq futures vs fair value: +3.00. U.S. equity futures continue holding slim gains, while European markets remain inside narrow ranges.

Trading volume during the first two sessions of the week has been very light with Monday's session producing the lowest total of the year, while yesterday's affair generated only a little bit more activity. With many participants still away from their trading desks for vacation, it shouldn't be too surprising if today's volume total ends up near the two-day average of 491.63 million.

7:59 am: [BRIEFING.COM] S&P futures vs fair value: +2.00. Nasdaq futures vs fair value: +2.50. U.S. equity futures trade little changed amid subdued action overseas. With the S&P 500 futures trading two points above fair value, the benchmark index is on track to begin today's session near yesterday's closing levels. Investors received a small batch of quarterly earnings this morning with several retailers beating expectations.

On the economic front, the weekly MBA Mortgage Index rose 2.8% to follow last week's uptick of 1.4%.

Treasuries sit near their highs with the 10-yr yield down three basis points at 2.37%.

In U.S. corporate news of note:

Aruba Networks (ARUN 22.25, +2.01): +9.9% after reporting a one-cent beat and guiding higher
Brown Shoe Company (BWS 32.15, +0.78): +2.5% following better than expected earnings
Express (EXPR 15.99, +1.40): +9.6% after beating estimates and raising full-year earnings guidance above consensus
Smith & Wesson (SWHC 11.36, -1.74): -13.1% after its cautious guidance masked its one-cent beat on below-consensus revenue
Tiffany (TIF 102.40, +1.63): +1.6% after beating bottom line estimates
TubeMogul (TUBE 12.60, +3.38): +36.7% in reaction to its better than expected results and upbeat guidance
Yingli Green Energy (YGE 3.36, -0.20): -5.6% after missing on both metrics and lowering its shipment guidance

Reviewing overnight developments:

Asian markets ended mixed. Japan's Nikkei +0.1%, China's Shanghai Composite +0.1%, and Hong Kong's Hang Seng -0.6%
Economic data was limited:
Australia's Construction Work Done fell 1.2% quarter-over-quarter (expected -0.3%; prior -0.4%)
New Zealand's FPI slipped 0.7% month-over-month (prior 1.4%)
South Korea's Consumer Confidence rose to 107 from 105 (expected 104)
In news:
Reports in Chinese press suggested major banks have stepped up their lending efforts following disappointing loan growth in July

Major European indices trade near their flat lines. Great Britain's FTSE +0.1%, France's CAC -0.1%, and Germany's DAX -0.1%. Elsewhere, Italy's MIB +0.1% and Spain's IBEX +0.2%
In economic data:
Germany's GfK Consumer Climate slipped to 8.6 from 8.9 (expected 9.0), while Import Price Index ticked down 0.4% month-over-month (consensus -0.1%; prior 0.2%)
French Business Survey slipped to 96 from 97, as expected Italy's Consumer Confidence fell to 101.9 from 104.4 (consensus 104.0)
Among news of note:
Ukraine's President Petro Poroshenko said he will work on an urgent ceasefire plan following yesterday's meeting with Russian President Vladimir Putin in Minsk

6:57 am: [BRIEFING.COM] S&P futures vs fair value: +2.00. Nasdaq futures vs fair value: +3.00.

6:56 am: [BRIEFING.COM] Nikkei...15,534.82...+13.60...+0.10%. Hang Seng...24918.75...-155.80...-0.60%.

6:56 am: [BRIEFING.COM] FTSE...6827.26...+4.50...+0.10%. DAX...9576.36...-11.80...-0.10%.

Bloomberg

U.S. Stocks Lose Momentum After S&P 500 Index Tops 2,000

http://www.bloomberg.com/news/2014-08-2 ... ecord.html

The rally that propelled the Standard & Poor’s 500 Index (SPX) above a record 2,000 lost a little bit of momentum today.

The S&P 500 rose 0.1 point to 2,000.12 at 4 p.m. in New York with about the same number of stocks rising as falling. About 4.2 billion shares changed hands across U.S. exchanges, the lowest volume since July 3, data compiled by Bloomberg show.

“The market is not overly expensive, not cheap either,” Ethan Anderson, senior portfolio manager at Rehmann Financial in Grand Rapids, Michigan, said by phone. His firm oversees $1.5 billion. “In the absence of strong corporate earnings, you are not necessarily going to see a huge surge in equities over the next 12 months. But the little notch up, on a regular basis, you’re likely to see continue.”

Global markets are surmounting crises in Ukraine, the Gaza Strip and Iraq as investors renew bets that stimulus will revive growth. Rallies from Brazil to Japan and the U.S. gauge’s first trip above 2,000 have sent the value of global equities to a record $66 trillion.

The S&P 500 is up almost 5 percent since Aug. 7, boosted by speculation the Federal Reserve will keep interest rates low as the economy strengthens. European Central Bank President Mario Draghi has also signaled policy makers may consider introducing an asset-buying plan.
Equity Valuations

The U.S. equity benchmark has seen gains in 11 of the past 14 days. It trades at 18 times the reported earnings of its companies, near the highest level since 2010.

The Dow Jones Industrial Average added 15.31 points to 17,122.01 today. The Nasdaq Composite Index was little changed after a four-day rally. Among industries in the S&P 500, telephone and utility stocks had the biggest gains, while energy, financial and technology shares fell the most.

“In the U.S., you’re seeing businesses do very well,” Doug Foreman, chief investment officer at Kayne Anderson Rudnick Investment Management in Los Angeles, said in a telephone interview. His firm oversees about $9 billion. “We’re in a situation where there are still some macro risks, but they’re overwhelmed by the micro, which is surprisingly good.”

Tiffany & Co. added 1 percent after posting second-quarter profit that topped analysts’ estimates and raised its earnings forecast for the year as higher prices boosted revenue.

Smith & Wesson Holding Corp. tumbled 14 percent after the gunmaker cut its full-year sales and profit forecast amid declining demand. Chico’s FAS Inc., a women’s clothing retailer, slumped 4.6 percent on lower-than-estimated sales.

Michaels Cos. jumped 9.3 percent as the arts and crafts retailer reported second-quarter earnings that topped analysts’ estimates. Express Inc. increased 13 percent after the apparel chain raised its full-year profit forecast.

Best Buy Co., the world’s largest electronics chain, rose 6.3 percent after posting second-quarter profit that topped analysts’ estimates, helped by lower costs.

“U.S. markets continue to defy geopolitical worries,” Richard Hunter, the head of equities at Hargreaves Lansdown Plc in London, wrote in an e-mail. “Many of the blocks are in place for the equity markets to make further progress.”

To contact the reporter on this story: Lu Wang in New York at lwang8@bloomberg.net

To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net Jeff Sutherland, Michael P. Regan

Global Sovereign Bond Gauge Approaches Record on Outlook for ECB

http://www.bloomberg.com/news/2014-08-2 ... r-ecb.html

A gauge of government bonds around the world approached a record high on speculation the European Central Bank is preparing to purchase debt as it tries to combat disinflation.

Bank of America Merrill Lynch’s Global Broad Market Sovereign Plus Index rose to within half a percent of its all-time high yesterday based on prices, according to data starting in 1996. As yields in Europe plunge, investors are snapping up government securities from the U.S. to Australia (GACGB10) in search of higher interest payments. Bonds in the index have returned 5.6 percent in 2014, headed for the biggest gain since 2011.

“The global bond rally has gone a long way in quite a short period of time, obviously driven by Europe and increased speculation over measures from the ECB,” said Su-Lin Ong, head of Australian economic and fixed-income strategy at Royal Bank of Canada in Sydney. “A discussion over both timing and what exactly those measures are going to be has dominated markets and set the tones for all markets globally.”

The U.S. 10-year yield was little changed at 2.35 percent at 10:22 a.m. in Tokyo, Bloomberg Bond Trader data show. It has fallen from 3.03 percent at the end of 2013. The price of the 2.375 percent note due August 2024 was 100 6/32. Thirty-year yields dropped to 3.0984 percent yesterday, the lowest level since May 2013.

Germany’s 10-year yields declined to a record 0.895 percent yesterday, and France’s (GFRN10) slid to an all-time low 1.228 percent. Australia’s dropped four basis points today to 3.29 percent. A basis point is 0.01 percentage point.

Investor expectations for inflation in the euro area have “exhibited significant declines at all horizons,” ECB President Mario Draghi said on Aug. 22, fueling speculation he is preparing to buy debt to bring down borrowing costs.

Draghi had previously said that a worsening of the medium-term inflation outlook would provide a reason for broad-based asset purchases.

To contact the reporters on this story: Wes Goodman in Singapore at wgoodman@bloomberg.net; Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net

To contact the editors responsible for this story: Garfield Reynolds at greynolds1@bloomberg.net Nicholas Reynolds, Pavel Alpeyev

Special thanks to Bloomberg, CNNMoney, Reuters and Yahoo! Finance for their market summaries.

Best Regards,
M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
@ http://twitter.com/wrbtrader @ http://stocktwits.com/wrbtrader

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