Futures vs FV: SP
Happy Veteran's Day! Thank all of you for your service! We need you now more than ever.
Not surprisingly, the world markets are taking a breather though much of the gains this week were in the established markets of the US, Europe, and some of Asia. Emerging markets were slammed as their currencies were crushed against a surging dollar.
Accordingly, last night central banks in India, Indonesia, Malaysia, and Singapore stepped in to support currencies.
It is a scenario seen before: when the US gets back to being the US, it tends to suck up a lot of investment because its system, when unleashed, unfettered, unshackled is the greatest economic engine in the world. The irony: thus far nothing has changed. Of course, markets price in change they see ahead of the actual change.
Earnings Beats: JWN, NVDA, KORS (BL)
Misses: JCP, DDS, DIS (TL, BL)
Retail doesn't look so great today with some earnings misses, but that may be more stock specific
Fed: Fischer says the Fed is close to reaching its mandate. He phrased that as 2% inflation and maximized employment. Okay, that is one way of looking at it but it is NOT the language assigned as its duties by Congress. Those two 'goals' are also not really what they say they are. Inflation is not 2%; it is more than that and accelerating. Does the Fed reach its goal if it hits its inflation target if just for a day, a week, a month as it surges through the 'goal?' Is employment met just because of an unemployment number, one reduced by massive numbers leaving the workforce, massive numbers of low pay jobs, and a record number of citizens forced to work multiple jobs? Great work Fed!! Go take a victory lap, back slap each other, and work for some Wall Street financial institution where you can write articles about the 'good old days' and your great deeds and insights while on the Fed -- that no one will read but for which you will be paid upper six figures. That while the middle class is slaughtered thanks to your 0% rate, money printing, investment killing policies. Again, great job! Now, go away.
Okay, I digress a bit.
OTHER MARKETS
Bonds: Market closed. 10 yer 2.138%
EUR/USD: 1.0908 VS 1.0867
USD/JPY: 106.518 VS 106.740
Gold: 43.76, -0.90
Oil: 1260.30, -6.10
Futures are modestly lower, well off early session lows. The bids keep wanting to come back and perhaps the low to high move pre-market will lead to some more buying. After this kind of week, however, and given it is Friday, we would really prefer not to feel compelled to enter positions today. A great surge and now a nice test would be a good setup to enter. One flat day on Friday may not be good enough to do that. But, we will see. There are some really good possibilities out there, and if stocks such as WWW, VLO, UTX fade a bit they would be good buys.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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