Market Montage
Stock Market, Economics, Equity Analysis
Jan15
Long time readers will know I've said "Doctor Copper" – once a fantastic economic indicator for economic activity – now has become much more of an indicator of demand out of China. This is true not just for copper, but a whole host of commodities, as the demand by the Chinese swamps the rest of the world. See March 2009 story – Commodities: It's China World, We Just Live in It. China at times the past few years accounted for half the world's output of steel… cement… you name it. China clamped down on the speculation in copper in the first half of 2011 as stories surfaced that it literally was being used as collateral for loans outside of the banking system. That, along with a push to slow down the economy due to inflation issues, hurt the red metal's demand in the country. …
Jan13
A month ago this sort of broad downgrade rumor/news – inclusive of France no less – would have led to panic and heavy selling of any and all things not named Treasures as "risk off" took over. This morning we saw something very different. While there was broad selling a lot of companies (with good charts) held up. For someone like me, I love to see that, as risk on – risk off, makes all thinking a moot point. …
Jan13
Long time readers know one way the Federal Reserve telegraphs its moves is to use certain members of the media to grease the skids. I've long held the theory that more quantitative easing is on the way – indeed I thought a year ago as we were in the middle of QE2, that QE3 would come with a lag time of about 6-9 months after QE2 ended (April 2011). Instead we received 'Operation Twist' just about the time I had anticipated the next round of QE. But never fear says CNBC's Steve Liesman – the Federal Reserve should be seriously considering QE very shortly. Perhaps the reason this market is like teflon right now as "those in the know" front run the news. …
Jan13
Not sure why this really matters anymore as this sort of thing has been rumored for weeks. But with the market on helium I guess something had to pop it momentarily. Via ZeroHedge
- Eurozone Sources Say Several Countries May Face Imminent Downgrade By S&P -Dow Jones
- Eurozone source says Germany will not be downgraded – RTRS
- S&P declines to comment
Jan13
The nature of this rally in its 'exclusivity' has been quite striking. While I said near the turn of the year we needed to see a broadening into new sectors for the rally off the December 19th low, I – nor anyone – could anticipate how things turned on a dime in terms of sector rotation. One does not expect the previous sector leadership to completely be abandoned in lieu of the new sectors – instead the general playbook is a broadening of strength with new groups taking the baton from the old, but both (the old and the new) doing well in a relative sense Usually all most groups will participate in a broader market upswing, but that has not been the nature of this leg of the rally; it has all happened in 3 broad sectors. These were of course the laggards of latter 2011 so you had to do a complete flip out of the winning sectors and into the laggards – or have a very difficult time generating any performance. …
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