Market Alert - Pre-Market

Futures vs FV: SP +0.51; DJ +15.89; NADSAQ +4.16

Another muddling day? Futures sure look familiar and the other markets are matching the 'go nowhere' morning (and Monday).

Billionaire watch: Marc Faber (uncharacteristically quiet of late) came back swinging, stating the S&P was set to lose 50% of its value and 5 years of gains. Hey, an economy built on inflation of financial assets IS at risk for that.

Productivity, Q2 Prelim: -0.5% vs 0.5% exp vs -0.6%.
Wow. Third quarter of negative productivity, the first such string since 1979. Why does that time period matter? Because that was part of the US' decline in the 1970's, and as you recall, I have made a lot of comparisons to that time because they are so alike in policies, taxes, and economic outcome, e.g. stagnation. The only thing missing is inflation, but the world is a bit different from then. For one thing, oil is not the factor it was. You think today oil ruled the markets? Back then it ruled everything, and OPEC was born.


OTHER MARKETS
Bonds: 1.585% vs 1.59%. Dead flat after selling back to the recent test lows in what could be a pennant forming on a retracement. Indicates could try a bounce.

EUR/USD: 1.1083 VS 1.1088. No real change here, either.

USD/JPY: 102.09 vs 102.35

Oil: 43.24, +0.22

Gold: 1342.50, +1.2. Oil Continues surging on Venezuela statements about OPEC considering a meeting to discuss production cuts. Hey, whatever works is okay, I guess. No facts? Make them up! That seems to be how things work today.


Some M&A, some earnings misses (COH, GPS, VRX, W) and a beat (MCHP in chips) pretty much has things as they were Monday: resting after the big move, trying to get it going again. Important that the market, whether or not today, holds the Friday move and extends it. Of course, watching well positioned stocks to see if they hold and make the moves. That will tell the market tale. Watching MCHP and chips to see if their good earnings sends SOX higher. The market has followed the chips.

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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