Market Soapbox 05/29/07
TUES, DJIA +14 on tepid volume with nice internals. All UP cept XMI, XOI, XAU.
Bonds down, 10 yr yield +3 bps 4.89, $ down vs 1.3452E & up vs 121.635Y, WTI crude down 3% $63.15, gold up $663.4
DJIA up 32 for 42; 45 record closes since Oct.; 23 YTD; and on a parallel with 1989 Nikkei 225: the DJIA is now 39 for 54.
Over the last 3 weeks, some magic numbers with strong resistance... SOXX 500-505. it still stands... and RUT 830, NDX 1905 are still magnets. SP500 straddling 1515 support at 1518.
Near term we could head down to 1475 or head up to 1545 on the way to 1575. My sense is this overliquified market will keep shrugging off bad news.
Pay heed to the interest rates, rising 30 basis points in the short term as equities keep performing, demand for bonds is waning. Investors are becoming more defensive as they sense higher yields in the offing.
Even 2 years notes are suffering.... today's 2 year bond auction 2.53 bid to cover ratio, below last auctions 2.93 and the 6 month average of 2.8. Indirect bidders fell to 22%.
This kind of mindset along with the Chinese sterilizing in the background (in concert with the Fed) could cause rates to rise further. Hastening the housing markets collapse and our economic demise.
Often wrong, but never in doubt, this is the Nattering Naybob and your not!
Bonds down, 10 yr yield +3 bps 4.89, $ down vs 1.3452E & up vs 121.635Y, WTI crude down 3% $63.15, gold up $663.4
DJIA up 32 for 42; 45 record closes since Oct.; 23 YTD; and on a parallel with 1989 Nikkei 225: the DJIA is now 39 for 54.
Over the last 3 weeks, some magic numbers with strong resistance... SOXX 500-505. it still stands... and RUT 830, NDX 1905 are still magnets. SP500 straddling 1515 support at 1518.
Near term we could head down to 1475 or head up to 1545 on the way to 1575. My sense is this overliquified market will keep shrugging off bad news.
Pay heed to the interest rates, rising 30 basis points in the short term as equities keep performing, demand for bonds is waning. Investors are becoming more defensive as they sense higher yields in the offing.
Even 2 years notes are suffering.... today's 2 year bond auction 2.53 bid to cover ratio, below last auctions 2.93 and the 6 month average of 2.8. Indirect bidders fell to 22%.
This kind of mindset along with the Chinese sterilizing in the background (in concert with the Fed) could cause rates to rise further. Hastening the housing markets collapse and our economic demise.
Often wrong, but never in doubt, this is the Nattering Naybob and your not!
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