There’s a global rally in stocks underway today. Shares are getting a bump from some progress in Ukraine where separatists have handed over the bodies as well the jet’s flight recorders recovered from the wreckage of Malaysia Airlines MK17. They also now pledge to allow investigators access to the crash site. This has sparked hopes that Russia will back away from its support of the separatists, easing tensions in the region. Of course this is just speculation and it remains to be seen if Moscow is truly in a conciliatory mood. Read more about In the Sweet Spot, for Now 07-22-14
Janet Yellen is back on Capitol Hill this week answering congressional queries. To no one’s surprise she reinforced the view that the Federal Reserve will maintain an ultra-easy monetary policy for some time to come, due to persistent slack in the labor market (despite the 6.1 percent headline unemployment rate). The consensus pegs mid 2015 as the likely start of Fed tightening, and an increasing number of economists expect the first rate hike could occur sooner. Read more about Sidelined, But Likely Not for Long 07-15-14
The title of our last update proclaimed that “Future Good News is Apt to be Less Well Received.” It didn’t take long for that call to ring true. Last Thursday the Bureau of Labor Statistics released a beauty of an employment report, with 288,000 non-farm payrolls created in June and the unemployment rate down to 6.1 percent. Stocks initially climbed on the news, but subsequently gave up all of those gains and then some. Read more about That Was Quick 07-08-14
The first half of 2014 was a fruitful one for investors, with stocks, bonds and commodities all generating solid returns. Returns in the second half are likely to be more modest, but we’re getting off on the right foot, aided by generally favorable U.S. economic reports.
Weekly chain store sales out today came in a bit below expectations, but nevertheless climbed at a 1 percent annualized rate. Year over year they were up 4.6 percent, an improvement over the prior 4.1 percent reading. Read more about Future Good News Apt to Be Less Well Received 07-01-14
As we’ve written often in recent updates, the market just does not want to correct or post a meaningful decline. Far from it. Last week, the S&P 500 closed at a new record high. Market technicals, however, remain similar to those we’ve observed in the past several weeks—stocks are moving generally higher on low volume, in what could be best described as “quiet trade.” Read more about Traders Stay Quiet 06-24-14