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Inside the Market |
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2/27/09 Yesterday’s Market Update Another bout of normalization for the Equity markets which infers lower prices was the story yesterday. Treasury prices held their ground and the Yen kept sliding. Finally, the correction in Gold continued. Economic Reports Economic reports remained incredibly anemic on the Durable Goods and Initial Claims front. But the markets are still in the mode of trying to digest bailout uncertainties rather than economic reports. More and more the Obama stimulus plan looks more and more horrible for long term economic growth. Stocks The near term positive outlook we posted for Bank of America came through nicely with almost a 10% gain at its highs, but the Doc will say that’s about it. The overall picture for the company remains dire. Fixed Income Forget about it. Currencies You know the story…the Yen is a pile and the EURO is waiting for a catalyst to rally. Gold & Silver The correction the Doc has been alluding to could have posted enough downside at yesterday’s lows. I would be surprise to see a Gold print of $900 over the short term. The recent downside pressure has been a re-confidence emerging in US banking. This will probably dissipate as reality sets in again.
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2/26/09 Yesterday’s Market Update The continued flapping by policy makers is just getting nauseating. Stocks reacted to the post Obama talk by selling off. Treasury prices got slammed and the Greenback posted little movement. Economic Reports Hey housing data came out….with just pathetic results. Stocks As we mentioned yesterday…nothing has changed despite the daily rhetoric by policy makers. One point I would make is that perhaps Bank of America is positioned properly for the proposed bail out plans but that doesn’t mean they’re out of the woods by any juncture. Path of least resistance remains lower for Stocks. Fixed Income A little slamming of 10 Year prices….a little more of this and let’s see how mortgage payments will be lowered in the new bailout plan. Currencies Yawn…except for the fact that the YEN and Greenback are overvalued at current levels. Gold As we mentioned yesterday…it’s short term shake out time.
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2/25/09 Yesterday’s Market Update Stocks managed to climb from the abyss as a host of jawboning and a pre-Obama address most likely caused a short squeeze. Treasury prices did little to nothing and the greenback made up some big ground on the Yen. Economic Reports Well what do you know, the mighty Japanese economy got slammed again with a massive drop in exports. Hey what about that safe-haven? Now didn’t the Doc tell you that was all crap? Hey…there was an Obama address last night and Bernanke spoke yesterday as well…. OK. Stocks What you probably had was a pre-Obama address short squeeze in Stocks while Bernanke jawboning also kept the pulse of the market positive yesterday. Pure and simple…nothing as changed. Fixed Income Still in the middle of a wild range as there is no real market value here. Currencies As the Doc alluded to yesterday, the Yen was overvalued to dirt and wide swings were about to occur…well is was about a 2 big figure Yen depreciation which is simply no surprise at all. Japan safe-haven? How about smoke and mirrors. Gold & Silver The Silver resistance at about $14.50 did ultimately hold. At this juncture what you may see is a shake out of weak long positions initiated above Gold $980. Long term however…smoking.
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2/24/09 Yesterday’s Market Update It was simply more cleansing, which means hammering for the beleaguered US Equity markets which are finally approaching historically correct valuations but still have more downside to go to get there. Treasury prices posted a quiet session and the Greenback rallied a bit via the EURO. Stocks As the Doc has warned since we’ve been back on-line….the downside trade is the path of least resistance for Stocks. The one positive for the massive carnage is that prices are finally getting back to more realistic valuations, but actually need more declines to really get there. This market remains riddled with downside risk, which should be no surprise given the smoke and mirrors economy and market valuations we’ve experienced over the past decade. Fixed Income Sorry…no reason to waste time on this sector yet. With all the talk about lowering mortgage payments and nationalizing banks…there is simply no real value to this market. International investors will probably wise up to this soon. Currencies The Buck still remains well overvalued to the EURO and the Yen massively overvalued to dirt. Keep an eye out for some big policy statements and some wild moves soon.
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02/21/09 Yesterday’s Market Update Stocks got hammered once again and although 100 points doesn’t look like much, on a percentage basis it’s a lot. Treasury prices jerked back and forth and the Greenback gave up a good chunk of ground to the EURO. Oh, by the way…Gold was on fire again. Economic Reports Don’t even bother. One particular point to note is that Alan Greenspan had the nerve to mention that banks should be nationalized. Why doesn’t he simply shut his mouth as his genius monetary policy that maintained negative real interest rates for years helped create the debacle we’re in. Just shut up and go away or be held accountable. Stocks This shellacking in Stocks is simply no surprise as we are entering the cleansing period of over a decade of bubble policy where earnings were propped up by consumer purchases of products and services with money they really didn’t have. The fallout is finally hitting the average Joe and it’s the average Joe that provides the underpinnings to American prosperity not corporate CEOs. No reason to buy stocks. Fixed Income Still in the middle of a wild range as there is no real market value here. Currencies Well it looks like the Doc won’t have to eat crow for a while as the Greenback backed away from EURO 1.2400. Yes the EURO Zone is in tough shape but the pathetic pulse of US fiscal policy is making Japan look conservative. Gold The Silver resistance was a bit higher at $14.50. It may take a couple of shots to get through it. Long term….what are you kidding me? Would you rather have a couple of shares of Google or a shiny coin with intrinsic value ?? All you genius analysts who have labeled Gold bulls as extremists….well, we won’t tell you what to do with your stocks.
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2/20/2009 Yesterday’s Market Update As the Doc warned, Stocks managed to break through the old Dow 7500 support and slowly deteriorated lower while Treasury prices got whacked again. This time the Greenback gave back some ground to the EURO. Economic Reports Oh my, Leading Indicators was the talk of the town as the release posted a mild upside surprise. This series is simply useless and economic reports at this juncture are just going to be filled with high variances. Just keep an eye on the Jobs situation which is horrible and will get worse. Stocks As the Doc mentioned yesterday…it didn’t look like the 7500 mark would hold. In fact, given the overall fallout on the Obama plan, highlighted by Rick Santelli’s comments in the link below, the downside is the direction to be careful of. Unemployment will continue to rise significantly from levels we are already seeing and consumption should wane dramatically. Go Rick: http://www.cnbc.com/id/15840232?video=1039849853 Fixed Income This market will be tricky, as the fallout from undisciplined fiscal policy is beginning to slowly weigh on longer dated Treasuries, however the stimulus plan is calling for lower mortgage payments. This will be interesting to see how price activity plays out. Middle of a wide and wild range in 10 years right now. Currencies The Doc would be surprise to see a EURO print of 1.2400 to the Greenback. The Buck may have run its course at recent levels. A trade through EURO 1.2400 and the Doc will have to apologize and eat some crow. Gold The Silver market ran into a bit of technical resistance at cash $14.35 which may reduce some technical buying over the short term. Long term for Gold and Silver…do I have to keep playing the record?
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2/19/2009 Yesterday’s Market Update Stocks held onto the 7,500 range bottom in a listless session while Treasury prices slide. The Greenback held onto its recent strength via the EURO and finally Gold surged again. Stocks Well so far, the Obama stimulus package has been received like a wet taco. At this juncture, the Doc would not bet on the farm for the Dow to hold the magical 7500 level which has held for months now. The economy is continuing to deteriorate quickly and risk remains quite high. Fixed Income No major moves just yet, but time is ticking for the international appetite to more and more shy away from Treasury paper at current Yields. Currency stability will play a key role but so far has not plagued the Fixed Income sector YET. Currencies The Greenback remains overvalued at current levels. However one point to make is despite the poor fundamentals for the US$, other global currencies are plagued as well. What you have is global currency crisis. And people wonder why Gold is appreciating.
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2/17/2009 The Doc is back and ready to go. Last Week's Market Update Stocks managed to post sizable losses last week while Treasury prices stopped the downside hemorrhaging. Finally the Greenback was inappropriately stable. Oh yes…Gold was red hot. Stocks The Doc’s Dow range of 7500 to 9000 remains well intact and the next driver of direction will be the market’s perception of the massive printing of money bailout plan passed last week. So far the global markets aren’t impressed. Perhaps it was the atrocious Japanese GDP number that kept the negative tone to those however. Keep your eyes close to the screen….will Wall Street applause the massive shoveling of US$s or simply hammer it. Fixed Income It’s simply the massive printing of US$s with the perception of it not being well allocated that will probably begin to erode prices in the longer end of the Treasury curve. Last week’s auction showed first signs of boycotting US paper. This will soon begin to be a very interesting market. Currencies The Greenback has caught an overnight bid off of some negative EURO news but that shouldn’t last long as the Buck is well overvalued at current levels. Gold Do I really need to tell you about this? My only comment is the amount of analysts who say they hate the Gold market. That’s simply pathetic. Those are the ones who probably thought the Japanese economy was a safe haven….get their market research from the tabloids.
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2/12/2009 The Market Doctor is back and will be posting market analysis on Tuesday, Feb. 17th. No thanks to Web.com for their total lack of customer service, nonexistent technical support and complete incompetence causing our site to be unavailable all of this time.
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| Stephan Kudyba (MBA, PhD) THE MARKET DOCTOR |
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Market Doctor Disclaimer All information contained herein is for informational purposes only and does not constitute an offer to sell nor the solicitation of an offer to buy any security. “The Market Doctor” or anyone affiliated with the production of the investment market information is not responsible for any activities conducted by viewers. This material is informational only and does not recommend investment activities for corresponding viewers. |
