Equity Market Insight from Nasdaq MID - September 13, 2017 .

Nasdaq’s Market Intelligence Desk (MID) is designed to provide critical touch-points for timely trading analysis and market information.

Equity Market Insight from Nasdaq MID - September 13, 2017

Wednesday, September 13, 2017, 10:36 AM, EST
  • NASDAQ Composite -0.06% Dow +0.01% S&P 500 -0.01% Russell 2000 +0.12%
  • NASDAQ Advancers: 1214 Decliners: 866
  • Today’s Volume (100 day avg) +3.9%

After two days of record highs the market opened slightly lower this morning and is hovering around the unchanged line. Energy (+.07%) is the leading sector while tech (-0.4%) is seeing some profit-taking. As has been the case all week there are no major headlines driving today’s trading. Treasuries continue lower while the dollar is higher, gold is down 0.2%, and crude oil is rallying. European markets are mostly higher but Asia is mixed to lower.

  • August PPI came in lower than expected at 0.2% vs. the 0.3% survey estimate. PPI ex food and energy was also lower than forecast at 0.1% vs 0.2% and a negative reading in July. According to Jeremy Klein “the lack of upward pricing pressures has frustrated members of the FOMC,” which wants to begin normalizing the Fed’s balance sheet.
  • Bloomberg has an article about the reduced chance of another Fed rate hike in 2017 but notes there are some bets that this will still occur given stronger inflation data in the UK and China. This is in contrast to the weak inflation readings in the U.S. (see PPI above) despite the low jobless rate. With gold trading higher and bond yields lower, something has to give soon.
  • Crude oil is about 1% higher today on a couple factors . Chatter on the trading desks reflects an expectation that OPEC will likely extend its production agreement past the March 2018 expiration, and the IEA increased their global demand forecast on of strength in Europe and the US. That is the second increased demand forecast this week. This week’s inventory data from both API and DOE show higher crude stocks but declines in gasoline & distillates, and overall didn’t impact crude prices.

Technical Take:

Admittedly we are not yet even two full weeks into the last month of Q3, but so far in September energy is leading all the main GICS groups with a MTD gain of +4.3% and +11.8% from its YTD low made on 8/18. This is the best monthly performance energy has seen in 2017 and while the sector remains in the red with a YTD decline of (13%), investors may finally be seeing value in the space. The recent surge in energy stocks has been driven by the oil services industry with the OIH ETF +10.3% MTD. The exploration industry is trailing on a relative basis with the XOP ETF +4.7% MTD, however it may be ready to start catching up. Today’s 2.5% gain is breaking out of a 10-month declining price channel and the volume over the first 30-minutes of trading is 2x the 50-day avg spanning that same period. It has also recaptured the 50-day sma which proved to be a firm resistance line in April and May. Momentum is bullish with the daily RSI, now 61, at its highest level since December 2016. Importantly it is worth noting the false breakout in July where the XOP moved above both its 50-day sma as well as the declining price channel, only to fail and roll over to new lows. With that in mind, the 50-day sma could be the level for new longs to measure risk against.


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Nasdaq's Market Intelligence Desk (MID) Team includes:

Michael Sokoll, CFA is a Senior Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information. 

Jeffrey LaRocque is a Director on the Market Intelligence Desk (MID) at Nasdaq, covering U.S. equities with over 10 years of experience having learned market structure while working on institutional trading desks and as a stock surveillance analyst. Jeff's diverse professional knowledge includes IPOs, Technical Analysis and Options Trading. 

Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors. 

Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

Annie O'Callaghan is Director on the Market Intelligence Desk (MID) at Nasdaq. Annie has worked for NASDAQ in a variety of roles including support of Nasdaq C-level management in client retention and customer service. Annie also served as a Sales Director in Nasdaq’s Transactions Services business. Prior to joining Nasdaq, Annie worked at AX Trading, managing accounts for its Alternative Trading System and served on Credit Suisse's trading desk as an Electronic & Algorithmic Sales Trading Analyst.

Brian Joyce, CMT has 16 years of trading desk experience. Prior to joining Nasdaq Brian executed equity orders and provided trading ideas to institutional clients. He also contributed technical analysis to a fundamental research offering. Brian focuses on helping Nasdaq’s Financial, Healthcare and Airline companies among others understand the trading in their stock. Brian is a Chartered Market Technician.

MID Chart for September 13, 2017
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