Greek Bonds Find Strong Demand

The market is slightly lower this morning, on the heels of weakness in overseas markets, strength in the US dollar, and a lackluster start to earnings season.

I am not a big fan of looking at Alcoa (AA) for market direction, but their earnings report last night is one of the things being cited today. I would actually rather look at Indian business outsourcing firm Infosys (INFY), which reported very solid numbers last night. Tonight is what I consider the real kickoff to earnings season, when bellwether Intel (INTC) reports.

The dollar is bouncing today, and that is causing weakness in energy and materials stocks. Oil prices are down to $82.75 currently, and gold is back below $1150, currently $1148.

In overseas news, Greece sold 1.56 billion euros in 6-12 month bills in an auction that was actually oversubscribed. In Britain, retail sales grew +4.4% yr/yr in March.

In Asia, most markets were lower with the MSCI Asia falling -0.5%. China managed to gain +1.0%.

Among the etf sectors, energy (-1.18%) and materials (-0.72%) are down the most. Tech (-0.09%) is down the least. And the only industry etfs to buck the weakness so far are the real estate etf (+0.97%) and hombuilders (+0.40%).

The 10-year yield is lower again to 3.83%, and the VIX has bounced from yesterday's mutli-year lows, currently +6.2% to 16.54.

Trading comment: The market continues to levitate around these levels, and it seems traders are showing skittishness. To wit, at the first signs of a lower market this morning, the ISEE call/put opened at an extremely low level of 54.

This highlights that at the first sign of weakness, traders rushed out to load up on puts. That is not exactly the type of action you would see if everyone was complacent. If that was the case, traders would just shrug off the weakness instead of rushing out to buy puts. This reinforces my inclination that any pullback could be short-lived.