Midday Market Commentary For 05-09-2013
By noon the markets have nowhere except sideways on falling volume. Investors are skittish about what Mr. Market is going to do next. Although the current wisdom appears to be bullish, it remains to be seen if there any investors left to push the averages higher.
The markets will most likely remain flat and lackluster for the remainder of today’s session.
The Depressing Effect Of QE
It is rather like sitting in the middle of the desert. We have $100 billion of new sand being pumped in by the Fed each month.
Our desert doesn’t get much wider as defined by new issuance and so one dune is heaped on another, the compression continues and yields, even from here, will decline.
Our sand trap is a fabulous world for borrowers and issuers and a miserable world for investors. The general thinking usually stops here but there is more to this story than that.
Over a period of time wealth declines as the bonds markets hold five times the assets of the equity markets and so the lack of yield, of income, begins to take its toll on consumer spending, on corporate revenues and then on profits and on the ability of those dependent of savings to maintain their standard of living.
The continual flow of money has helped the banks and helped corporate borrowers but it has not filtered down to the savers and, in fact, their position has been lessened by what the Fed has done.
The DOW at 12:30 is at 15097 down 8 or -0.05%.
The SP500 is at 1629 down 4 or -0.23%.
SPY is at 163.08 down 0.25 or -0.16%.
The $RUT is at 968.14 down 2 or -0.23%.
NASDAQ is at 3413 down 0.33 or -0.11%.
NASDAQ 100 is at 2965 down 3 or -0.20%. (A lot of analysts are currently watching the 100 for a heads and shoulder formation.)
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is sideways.
WTI oil is trading between 96.66 and 95.37 today. The session bias is bearish and is currently trading down at 95.82.
More Widening For The Brent/WTI Spread ahead?
Brent crude is trading between 104.61 and 103.45 today. The session bias is bullish to neutral and is currently trading up at 103.97.
Gold fell from 1474.75 earlier to 1458.83 and is currently trading up at 1469.05.
Here’s why copper has lost its indicator role
Dr. Copper is at 3.334 fell from 3.378 earlier.
The US dollar is trading between 81.83 and 82.35 and is currently trading up at 82.28, the bias is currently bullish.
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Written by Gary
