U.S. stocks reached all-time highs today (SPY +0.8%), with the Dow Jones industrial average less than 70 points away from the 20,000 mark, as a record-setting post-election rally showed no signs of fatigue. Short-term indicators showing a very strained market.
Here is the current market situation from CNN Money
North and South American markets are mixed. The S&P 500 is higher by 0.87%, while the IPC is leading the Bovespa lower. They are down 0.12% and 0.03% respectively.
$NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
(Reuters) - U.S. stocks reached all-time highs on Tuesday, with the Dow Jones industrial average less than 100 points away from the 20,000 mark, as a record-setting post-election rally showed no signs of fatigue.
CHICAGO/WASHINGTON (Reuters) - U.S. President-elect Donald Trump's challenges to China on trade and Taiwan are rattling American companies who have long benefited from stable relations between the two countries but now fear retaliation by Beijing if Trump were to act.
LONDON (Reuters) - British public sector pension funds on Tuesday called for an "appropriate" premium in any potential deal between Twenty-First Century Fox and Sky as well as for safeguards to protect minority shareholders.
LONDON (Reuters) - BP's refining operations are exposed to high safety risks that can lead to deadly accidents and pollution as a result of slack management and a lack of investment, according to a leaked internal report from 2015.
LONDON (Reuters) - In the waters off Malaysia, Royal Dutch Shell is finding gas quickly and cheaply to replenish depleting fields where only a few years ago geologists had lost hope of discovering any new reserves.
SAN FRANCISCO (Reuters) - Alphabet Inc's Google self-driving car project will become an independent entity within the technology company called Waymo, executives said on Tuesday, signaling a willingness to finally monetize its valuable research amid fierce competition from rivals.
MILAN/LONDON (Reuters) - Italy's largest bank, UniCredit , plans to raise 13 billion euros ($13.8 billion) in the country's biggest-ever share issue to shore up its balance sheet and shield itself from a broader banking crisis.
Small Business Optimism was "basically unchanged from October's reading up to the point of the election and then rose dramatically after the results of the election were known," according to NFIB chief economist Bill Dunkelberg. In fact the surge was the sharpest since 2009 as the balance of those who thought business conditions would improve exploded from -6 to +38. However, actual sales continue to decline and "business uncertainty" has never been higher.
As Bloomberg reports, "Small businesses like unified Republican government," said Neil Dutta, head of U.S. economics at Renaissance Macro Research LLC, who highlighted that the NFIB's index fell in November 2012 — when Obama won re-election — but recorded a solid rise in November 2004 after voters granted George W. Bush a second term.
However, the vast majority of segments that showed improvements in November's survey were forward-looking in nature; on both actual sales and earnings changes, the balance of opinion remained steeply negative.
As optimism soars, actual employment declined...
And as actual sales tumble, so hope for future sales soars...
We realize that it's the holiday season and markets are thin, but they sure are interesting. Full of complexities. Or is it contradictions? As Bloomberg's Richard Breslow notes, so many assets, economic story lines and geopolitical risks can go either way. Yet traders seem to be set on their current leaps of faith and happy to ignore the rest as next year's problem.
Despite all the debatable points there's a remarkable, some would argue reckless, amount of confidence being espoused. People are sure that things are setting up quite clearly for us to be about to enter the year of the [fill in the blank]. How we close this year will have a lot of influence on market psychology as positions are rebuilt and P/Ls started anew come January.
One favorite, no surprise, is the dollar is the place to be. Rates, safe haven, fiscal stimulus. USD/JPY is motoring and EUR/USD will have to test lower. Yet the minds of traders work in mysterious ways.
Monday we made a multi-month high in USD/JPY and then had a sloppy close. Failure came the screams. Mostly from people who don't have the trade. A month of fundamental analysis went out the window. Until the pair re-took 115 Tuesday. Sloppy closes should be a chapter heading when they write the history of this year and are not as informative as they were in the past.
For now, the dollar index is between 100.50 and 102. Trade away in-between. Declaim outside.
While the US has been bombarded by the artificial, mainstream media-fabricated concept of "fake news" for the past month, a strawman erected in an attempt to impose creeping limits on free speech and eliminate any outlet that does not comply with the government narrative and is accused of being "Russian propaganda", China does not need to beat around the bush. Instead, it has shortcuts, like newspaper editors unexpectedly "falling" to their death.
Case in point: Liu Jiandong, the general manager the 21st Century Business Herald, a major Chinese newspaper group that has been in trouble with the government for alleged blackmail and corruption, mysteriously "fell to his death on Monday", the newspaper said.
The 21st Century Business Herald carried a short statement on its official microblog from publisher 21st Century Media Ltd saying 21st Century Media's general manager, Liu Jiandong, had fallen from a building and died despite efforts to save him. As Reuters adds, Liu took up his job in January 2015, which he was dedicated to, and was "upright and honest", the paper said, adding an investigation was going on.
In a "suicide" that was a carbon copy of the death of Monte Paschi's David Rossi, the police in the southern city of Guangzhou, where the newspaper is based, said it had responded to a call about a man "falling from an office building." Police only identified him by his family name, Liu, and said he was a company general manager.
They added that "at the moment" there was no suspicion of murder. They will certainly have no suspicion of murder if their investigation reveals that the Chinese government itself is involved in the "suicide."
Why was the newspaper on China's black list? As the WSJ report ...
"This time is different", or maybe it's just 1929 all over again, because according to Deutsche Bank, after 8 years of easing sent the S&P to all time highs, the only thing that is more bullish than a dovish Fed, is a Hawkish one, and as a result no matter what the Fed does tomorrow, and how it hikes rates, equities can only go "higher."
Battery-powered electric cars outsold gasoline ones at the dawn of the automotive age. In a decade or so they may well do so again. Investors need to watch out they don't get caught on the wrong side of history.
A MarketWatch reader recently took to the comments section to hail Donald Trump as "the 21st Century's Abe Lincoln." Microsoft's Bill Gates has now offered a flattering presidential parallel of his own.
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