Halftime Report for 4.9.2012

The CBOE Volatility Index (VIX) hit its highest level in over a month, gaining nearly 10%. However, equities, oil, and the Euro bounced off their session lows, leading the VIX to lose ground as well.

Oil is down 1.8% to $101.50, with support at $100 below. Natural gas is flat on the session, trading at 2.088.

EUR/USD is higher by 30 pips to above 1.31 figure, while USD/JPY is trading in the mid-81 figure range. Further uncertainty could push USD/JPY to test support at figure 80.

More News and Numbers:
– Apple (AAPL) is higher by 0.4% following a downgrade at BTIG
– AOL (AOL) is higher by 45% after announcing a patent deal with Microsoft (MSFT). AOL hit its highest price since November 2010
– AT&T (T) will sell its stake in Yellow Pages to private-equity firm Cerberus Capital Management for $950 million. T is down 1% today
– Facebook is giving $1 billion in cash and shares to Instagram 

Morning Rage 4.9.2012

Equity futures are down roughly 1%, pushing S&P futures to the low end of its bull channel. Today’s price action will be incredibly important, technically speaking. If prices close below the bull channel, we could see further declines in the week ahead. Most of this price action is a result of a dismal jobs report from Friday, which only saw 120,000 new jobs created in March – about half of what economists were expecting. In addition, earnings reports begin this week, starting with Alcoa (AA) tomorrow afternoon.

Overseas, European markets were closed for Easter Monday, while Asian markets were down. China reported that CPI rose 3.6% in March, up from 3.2% in February. China has been outspoken that it could further tighten monetary policy in the wake of rising inflation – a negative for the overall global growth story.

As is typically the correlation, we should see the CBOE Volatility Index (VIX) spike when it opens this morning. VXX, an ETF that follows VIX short-term futures, is indicated 5.2% higher in premarket trade.

Commodities are mixed in early trade. Oil is off over 1.5%. Reports overnight suggest that Iran may reenter talks over its nuclear program, helping to ease angst over a supply disruption. Gold futures are 0.8% higher to near $1,650 per ounce.

Other News and Notes:

– AOL shares are up nearly 32% after announcing a plan to sell $1.1 billion in patents to Microsoft (MSFT). MSFT shares are lower by 0.9%

– Sony (SNE) will cut 6% of its workforce

– Needham & Company starts LinkedIn (LKND) at a hold. LKND shares look to open down 0.5% at $98.80

– The analyst who put a $1,000 price target on Qualcom (QCOM) has downgraded Apple (AAPL) to neutral from buy. AAPL shares down 1% to $626.84

– Avon (AVP) appointed a new CEO, perhaps in a bid to have someone to negotiate with Coty products over its proposed takeover. AVP is down 1.8% to $23.00

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Meadows on the Markets 4.5.2012

The US$ and bonds finished the week with positive returns, while Crude, NASDAQ, and bonds finished relatively unchanged. Natural gas fell another 1.4% this week, while gold slid 2.4%.

Here are how markets closed on the week:

– US$: +1.4%
– 30-year bond futures: +0.4%
– 10-year note futures: +0.3%
– NASDAQ futures: +0.1%
– Crude oil: +0.1%
– S&P futures: -0.9%
– DJIA futures: -1.2%
– Natural Gas: -1.4%
– Gold: -2.4%

There was some interesting news released Thursday. Facebook has apparently decided to be listed in the NASDAQ under ticker FB. Shares are expected to debut in May.

In addition, Warren Buffet is said to have guarded Berkshire Hathaway (BRK) against higher rates according to Moody’s. Moody’s says that BRK’s losses as a percentage of shareholder equity would be the lowest among 27 insurers.

By Mark Meadows