The Morning Call
7/23/20
The
Market
Technical
The Averages (27005, 3276) were up again on the day. The S&P continued its advance above its
June high, establishing a very short term uptrend and indicating a likely
challenge of its February all time high (3393).
The Dow was finally able to fill its ‘island top’ on a closing basis, a big
technical plus. Volume was up, breadth was
mixed, as was the VIX (its 200 DMA reverted to resistance but it remains unable
to push through its June low. I am
sticking with my assumption that the Market’s bias is to the upside.
Bad breadth.
Valuations.
The top five have
set a new record.
Gold was up another
1 ½% on big volume, making another new nine year high. The long bond was also up, keeping its upward
momentum going. The dollar declined,
ending below the lower boundary of its short term trading range for a third day
thereby resetting to a downtrend. All
this suggests a weak economy.
Bond yields likely
to stay low.
Deutschebank top
credit analyst admits that he is a gold bug.
Insider selling is
picking up.
Wednesday in the
charts.
Fundamental
Headlines
The
Economy
US
June existing home sales rose 20.7% versus
forecasts of +24.5%.
International
Other
Architecture billings are beginning to stabilize.
Gun sales skyrocketing, banks hoarding cash.
The difference between de-dollarization and
being de-dollarized.
https://alhambrapartners.com/2020/07/20/huge-massive-difference-de-dollarizing-vs-being-de-dollared/
This is for the optimists. His analysis might be more spot on if he
included versus GDP by economic sector.
The
coronavirus
Four months of egregious government
malfeasance.
How long does a typical coronavirus infection
last?
China
Chinese debt fuels debt crisis in Africa.
Bottom
line. however
stock investors may be interpreting the economic, political, social (unrest)
news flow, the big boys in the bond, dollar and gold markets are betting their
money on a weak economy and political/social uncertainty. That makes me feel all warm and fuzzy about
my cash and GDX positions and confident in any sales of stocks that reach their
Sell Half Price.
News on Stocks in Our Portfolios
Canadian National Railway (NYSE:CNI): Q2
Non-GAAP EPS of C$1.28 beats by C$0.02; GAAP EPS of C$0.77 misses
by C$0.48.
Revenue of C$3.21B (-18.9% Y/Y) misses by C$50M.
Canadian National Railway (NYSE:CNI) declares CAD
0.575/share quarterly dividend, in line with previous.
What
I am reading today
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