7/23/15 The smell of napalm

Rarely have I witnessed the kind of wholesale shellacking in commodities that began Sunday evening (a $2.4b sale of gold some analysts view as a blatant attempt to manipulate prices, as the bullion was dumped in a single sale during a session when most major markets were closed) and has continued all week.

(a)          FCX (Freeport McMoran) announced an earnings ‘beat’ this morning, only to see its shares taken down another -10% to 13.56.  Company insiders have been prescient in the past, marking ‘bottoms’ with eerie precision (at least since I started following the company in 2005).  It’s a little different this time: http://finance.yahoo.com/q/it?s=FCX+Insider+Transactions.  At least two officers recently shelled out between $5-10m on shares priced in the high teens to low twenties, and are now looking at -40% haircuts.  Very unusual!

(b)          Commodity-rich Brazil (EWZ) is off another -4% today.

(c)           Both OIH (oil services) and XLE (energy) opened strong, +2.8%/+2% respectively.  Now +1.8%/-0.1%.  Crude itself is off -1%, with Nymex oil futures near a 4-month low under $49.

(d)          Miners also started off strong (GDX +1.6% at the open), only to meet a wave of supply which has many majors printing new 52-wk lows and GDX off -3.8%.

(e)          EEM (emerging markets) off -1.03% to 37.58.

(f)           US indexes faring a little better, with most off just -0.7%.

(g)          Utilities off -1.7%.  The only green would be long-dated Treasurys, now +1.26%.

I see the possibility of 'bottom candles' in the energy sector (OIH in particular), but no signs of a turnaround elsewhere.