Category Archives: Equities

S&P Gets It Done

Posted on March 28, 2013 by macromon

The S&P500 finishes Q1 at a new all-time closing high of 1569.19 taking out the 1565.13 October 2007 high.    Impressive getting it done without Apple and Google with today’s slam dunk (see video)  led, again,  by utilities and healthcare. Next … Continue reading →

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Staples Outperformance Signalling a Correction?

Posted on March 27, 2013 by macromon

Let’s revisit the S&P500 (SPY)  and Consumer Disretionary: Staples ratio (XLY/XLP). Last month we flagged the outperformance of consumer staple stocks relative to consumer discretionary was signaling the pullback albeit a small one — just over 3 percent around the … Continue reading →

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Cyprus Deal Unleashes Bidzilla

Posted on March 24, 2013 by macromon

The BIDzilla for U.S. equities is relentless.  Though Europe is far from out of the woods (see last week’s PMIs) and it’s still unclear when the banks in Cyprus will reopen tonight’s bailout removes the uncertainty of a Cyprus eurozone … Continue reading →

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S&P500 Testing Key Support

Posted on March 21, 2013 by macromon

Hard to to discern the cause of the increase in chop in U.S. equities.  Cyprus?  Overbought? Earnings worry?  Strong dollar’s impact on earnings (see Oracle’s release)? Here’s what we said on March 4th: No doubt the stronger dollar will be … Continue reading →

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WTF Were They Thinking?

Posted on March 18, 2013 by macromon

That’s our System 1 (fast) thinking  kicking in after hearing the news of the Cyprus bail-in of depositors.  Our fast thinking really fears contagion and makes us want to vendere la casa!   We often get into trouble trading with … Continue reading →

Posted in ECB, Equities, Euro, Germany, Sovereign Debt, Sovereign Risk | Tagged , , | 7 Comments

Stocks Better Than Alternatives – Economist

Posted on March 7, 2013 by macromon

The Economist sums the melt up best: It is tempting to attribute the strength of the Dow to optimism about the American economy. Tempting, but wrong. Studies have shown almost no correlation between GDP growth and equity returns. Indeed, the … Continue reading →

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No Joy In Shortsville As Noise Traders Find No Sellers

Posted on March 4, 2013 by macromon

In 1990 Brad De Long, Andrei Scheifer, Larry Summers, and Robert Waldmann published, Noise Trader Risk in Financial Markets, in the Journal of Political Economy.   The piece made the distinction between short-term traders with long-term investors and concluded that their … Continue reading →

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That Was Ugly

Posted on February 28, 2013 by macromon

Ugly close. The Dow was within 15 points of its all-time when the sellers ambushed the market at 2:30 New York and beat it like a drum into the close.   The VIX couldn’t pierce the 14 level and spiked 8 … Continue reading →

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The Bernanke Stock Squeeze

Posted on February 27, 2013 by macromon

So Bernanke says 2016 is when he thinks unemployment moves to the monetary policy target of 6.5 percent.   That’s a long time before the party in U.S. stocks will end.    Nutcracker short squeeze. The shakeout over the past … Continue reading →

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VIX Spikes and the S&P500

Posted on February 25, 2013 by macromon

Epic 34% spike in the VIX today. The 1oth largest daily percent increase since 1990 and biggest since August 2011, which, at the time was in the midst of a nasty correction/mini bear market.   The S&P500 is only off … Continue reading →

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