Bear Mountain Bull

It’s time again for a little BMB R&R, especially with the market behaving as bizarrely as it’s been. Maybe if we stop watching it start to behave a little better…

Posting will be very light and variable over the course of this week, but we’ll put up an open thread each market day for our readers to comment on the day’s market activity or to post any interesting links they might run across.

Check the space below for whatever the latest might be during this ‘off’ time, and please visit the various sites in the ‘Links’ and ‘Regular Stops’ for up-to-date market news and analysis.

BMB will be back in full swing by next weekend.

If the market gets much duller, I’m going to have to start mowing lawns for excitement. A little bump in the beaten down techs was about all the market could muster today, but that helped the Nasdaq save a little face for now. As for the rest, well, the S&P traded in another ‘huge’ 6-point range today. The Dow tagged 12700 before dropping some 70 points, then moving back up to end right back where it started:

The bounce in bonds continues, and yields moved lower again:
6-month: 5.15%    2-yr: 4.87%    5-yr: 4.72%    10-yr: 4.75%   30-yr: 4.85%.

Market internals were much more positive than the price action might indicate, and volume snuck up above yesterday’s levels. Advances/declines were 11 to 8 on the NYSE and 3 to 2 on the Nasdaq. Up/down volume was just above flat on the NYSE but 3 to 1 on the Nasdaq. New highs/lows were 417/8 on the NYSE and 205/40 on the Nasdaq.

More winners than losers in the groups, with networking stocks (+2.1%) bouncing back to lead the pack, followed by REITs (+2.0%), paper stocks (+1.9%), internets (+1.6%) and semiconductors (+1.6%). Oil services (-0.8%) led the losers.

Energy prices were again mixed, but roles were reversed from yesterday. Crude lower, to $57.71/barrel, and gasoline down to $1.54/gallon, but natural gas higher to $7.71/mmBTU. The dollar index was nearly flat at 84.73. Gold and silver were all but flat as well, at $651/ounce and $13.59/ounce.

BMB Note: Not surprising that the oversold techs made a little move, helped by Cisco and Broadcom. And it looks like the REITs are about ready for spontaneous combustion.

Still little follow-through to speak of from last week. This market continues to feel very ‘mushy’, and you certainly don’t get the sense that there’s a lot of ‘big money’ pushing things higher. Then again, nothing’s broken yet, but there is so little momentum that you have to measure your gains in dimes instead of dollars. Unless you’re in the REITs, of course, which should make a neat explosion when they finally collide with the sun.

You’re welcome to try to play this, if you can figure out how. The good news is you probably can’t lose a lot - the bad news is that it’s like pulling teeth to make much of anything.

I’ll watch. I don’t need the frustration.

According to government figures, petroleum product inventories were mixed this week:

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) declined by 0.4 million barrels compared to the previous week. At 324.5 million barrels, U.S. crude oil inventories are above the upper end of the average range for this time of year. Total motor gasoline inventories rose by 2.6 million barrels last week, and remain above the upper end of the average range. Distillate fuel inventories declined by 3.7 million barrels, but remain above the upper end of the average range for this time of year.

Refineries operated at 87.3 percent of capacity, and YOY demand remains strong:

Total products supplied over the last four-week period has averaged nearly 20.8 million barrels per day, or 3.2 percent above the same period last year. Over the last four weeks, motor gasoline demand has averaged nearly 9.1 million barrels per day, or 3.9 percent above the same period last year. Distillate fuel demand has averaged over 4.3 million barrels per day over the last four weeks, or 3.6 percent above the same period last year. Jet fuel demand is up 6.3 percent over the last four weeks compared to the same four-week period last year.

Another grinding morning, sending the market a little higher yet again. The techs seem to be feeding off of Cisco’s earnings, giving them an excuse to move higher. While the Dow and S&P are only marginally higher, the Nasdaq is up about 0.9%, and the Nasdaq 100 is up 1.2%. The networkers, internets and semis lead the way. And of course, the REITs are higher for the 12th day in a row. Airlines lead the losers.

Bonds continue their bounce, pushing yields down. Energy prices are edging higher. The dollar is flat, gold and silver just a bit higher.

Last week, while BMB was a little distracted from the goings-on in the market, ProShares launched 22 new ETFs that give double and double-inverse exposure to individual sectors of the market. These funds are in addition to the current PowerShares offerings that provide double, inverse and double inverse exposure to some of the major indices.

The new ETFs and symbols are as follows:

The Ultra funds attempt to offer “double” performance in the following sectors:

• Ultra Basic Materials (UYM)
• Ultra Consumer Goods (UGE)
• Ultra Consumer Services (UCC)
• Ultra Financials (UYG)
• Ultra Health Care (RXL)
• Ultra Industrials (UXI)
• Ultra Oil & Gas (DIG)
• Ultra Real Estate (URE)
• Ultra Semiconductors (USD)
• Ultra Technology (ROM)
• Ultra Utilities (UPW)

The UltraShort funds attempt to provide “double inverse” (short) performance in those same sectors:

• UltraShort Basic Materials (SMN)
• UltraShort Consumer Goods (SZK)
• UltraShort Consumer Services (SCC)
• UltraShort Financials (SKF)
• UltraShort Health Care (RXD)
• UltraShort Industrials (SIJ)
• UltraShort Oil & Gas (DUG)
• UltraShort Real Estate (SRS)
• UltraShort Semiconductors (SSG)
• UltraShort Technology (REW)
• UltraShort Utilities (SDP)

Thanks goes to Random Roger for the heads-up.

Update: As with any new ETFs, be a little careful with these issues, as they’re likely to be quite thinly traded for a while, and may never develop a large following.