long positions should continue to outperform shorts
Not much change today [Wednesday] after the big move
on Tuesday with US stocks. There has been noticeable
selling in the Treasury bond market and that money
getting cycled into stocks. We are in between cycles of
news events so the market isn’t focused on anything too
important right now. We have only Producer Price Index
tomorrow which reflects how much costs have gone up
and may be used for an inflation indicator. Consumer
Price Index (CPI) comes out Friday.
The Michigan Sentiment comes out Friday, which has
been weighed fairly heavily this last few months. The
long positions should continue to outperform shorts.
Still maintain an overall awareness of when the market
trend may be changing and adjust your longs or shorts
accordingly. Don’t assume we continue to move up for
long periods of time. Usually there are events that mark
a trend change with high volume and have a perceived
fundamental influence on markets.
The Dow30, Nasdaq Composite, and the S&P 500 had
virtually no change. The Russell 2000 was down 0.92% and
the CBOE Volatility Index which is a gauge used to measure
fear in the market place was up 3.7%.
In economic news, Import Prices rose 0.4% in February
which was less than expected. The Current Account Balance
hit a three year high at -$124.1B compared to the $113.8B
that was expected.
The Fed announced Tuesday that all but four US financial
institutions exceeded expectations in recent stress tests. C,
Citigroup which was down 3.4%, STI, Suntrust Bank up
4.5%, Metlife down 5.8%, and Ally Financial were the four
that did not meet the expectations according to this report.
Some of the institutions that exceeded expectations of the stress tests were JPM, JPMorgan which was up 0.4%, BAC,
Bank of America up 4.1%, WFC, Wells Fargo which was virtually unchanged and USB, US Bancorp was up 1.5% at the
close on Wednesday.
In other news:
Gold was down 3.2% to close at $1639.40 an ounce and oil was down 1% and closed at $106.18 a barrel.