The Morning Call
5/12/20
The
Market
Technical
The Averages (24221, 2909) had a roller coaster day with
the Dow finishing down and the S&P basically unchanged. Both of the indices closed above their 4/17
highs; and the S&P ended right on the level of its preceding 4/29 high for
a second day. It appears the standoff of
the last three weeks is getting resolved to the upside---though yesterday’s pin
action did little to support that notion.
So, it will take a couple more upbeat days to confirm it.
GLD and the long
bond sold off while the dollar was up on heavy volume. All their charts remain strong; but that is
what is a bit confusing. They shouldn’t
be trading in unison to the upside unless investors are nervous---and equity
investors appear anything but nervous.
Monday in the
charts.
Fundamental
Headlines
Not
much economic data yesterday. April consumer inflation expectations were above estimates. Overseas, April Chinese loan growth was higher
than anticipated.
The
economy
Update on big four
economic indicators.
Savings ‘mirage’
won’t save the economy.
Inflation will
likely not be a problem.
The economic pain
will persist even after the pandemic is over.
How long could
high unemployment last?
We are all
government sponsored enterprises now.
The
coronavirus
***overnight update.
More coronavirus
aid.
Bottom line. much of the Market is very overvalued. Even those stocks that had traded down into
the Buy Value Ranges in the March selloff have appreciated enough that they are
no longer buy candidates. Hence, I am
not a buyer of stocks at this time and would likely become a seller if any of
our stocks trade into their Sell Half Range.
The
corona effect on investing.
What happens to
stocks after a big up month?
News on Stocks in Our Portfolios
Economics
This Week’s Data
US
April
consumer inflation expectations rose to 2.62% versus expectations of 2.5%.
The April small
business optimism index came in at 90.9 versus estimates of 80.0.
April CPI was
-0.8%, in line; core CPI was -0.4% versus -0.2%.
International
The March Japanese leading economic
indicators were reported ate 83.8 versus forecasts of 83.6.
April Chinese CPI was -0.9% versus
consensus of -0.5%.
Other
Bank of China eases
monetary policy.
Chinese
officials call for renegotiating terms of Phase 1 trade deal.
What
I am reading today
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