The Morning Call--You can't keep a Fed fueled Market down

 

The Morning Call

 

2/25/21

 

The Market

         

    Technical

 

            Wednesday in the charts.

            https://www.zerohedge.com/markets/stocks-bonds-dumped-n-pumped-powell-promises-moar

 

The long bond penetrated the lower boundary of its very short term trading range intraday but recovered to close above that level.  The question is will this support level continue to hold?

 

            Winners and losers in the bond market.

            http://www.capitalspectator.com/reflation-trades-winners-and-losers-in-the-bond-market-in-2021/#more-15596

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

The second estimate Q4 GDP growth was 4.1% versus forecasts of 4.2%; the price index was +1.8% versus +2.0%.

                              https://www.zerohedge.com/economics/q4-gdp-revised-41-missing-expectations

 

                          Weekly jobless claims rose 730,000 versus predictions of 838,000.

                          https://www.zerohedge.com/personal-finance/first-time-jobless-benefits-seekers-plunge-covid-crisis-lows-amid-collapse-caoh

 

January durable goods orders were up 3.4% versus expectations of +1.1%; ex transportation, they were up 1.4% versus +0.7%.

                          https://www.zerohedge.com/economics/us-durable-goods-orders-surge-january-pre-covid-highs

 

                          January new home sales rose 4.3% versus consensus of +2.1%.

                          https://www.advisorperspectives.com/dshort/updates/2021/02/24/new-home-sales-up-4-3-in-january

 

               

                        International

 

The December Japanese leading economic indicators came in at 95.3 versus projections of 94.9.

 

February EU consumer confidence was -14.5 versus projections of -14.8; economic sentiment was 93.4 versus 92.0; services sentiment was -17.1 versus -18.1; industrial sentiment was -3.3 versus -5.0.

 

March German consumer confidence  was -13.9 versus estimates of -14.3.

 

                        Other

 

                          Closer to the breaking point.

                              https://themarket.ch/interview/were-getting-closer-to-a-breaking-point-ld.3681

 

                          Architecture billings continue to contract.

                          https://www.calculatedriskblog.com/2021/02/aia-architecture-billings-continue-to.html

 

                          Mortgage delinquency rate decreased in January.

                          https://www.calculatedriskblog.com/2021/02/black-knight-national-mortgage.html

 

            The Fed

 

              More gasoline on the fire.

              https://www.zerohedge.com/markets/stocks-bonds-suddenly-bid-brainard-powell-double-dove-down

 

            Fiscal Policy

 

              Why not print checks and give money away infinitely?

              https://thereformedbroker.com/2021/02/24/why-not-just-print-and-give-away-money-infinitely/

 

                  More debt doesn’t grow the economy.

              https://thereformedbroker.com/2021/02/24/grantham-more-debt-doesnt-grow-the-economy/

 

 

            Inflation

 

              More positive feedback for the optimists.

              https://www.advisorperspectives.com/commentaries/2021/02/24/fiscal-spending-could-cause-a-u-s-growth-spike-compounding-investors-concerns-on-inflation

 

              Still more: four reasons not to worry about inflation.

              https://www.bloomberg.com/opinion/articles/2021-02-23/four-reasons-not-to-worry-about-u-s-inflation?sref=loFkkPMQ

 

            The coronavirus

 

              Latest stats.

              https://marginalrevolution.com/marginalrevolution/2021/02/a-majority-of-doses-are-now-second-doses.html

 

            Bottom line.

 

              More for the optimists: three reasons why stocks can survive higher rates.

              https://www.marketwatch.com/story/3-reasons-why-the-stock-market-might-be-able-to-survive-rising-bond-yields-in-2021-11614119111?mod=home-page

 

 

    News on Stocks in Our Portfolios

 

 

 

What I am reading today

                             

            The sorry state of our political class.

            https://www.zerohedge.com/political/chicago-faces-135-increase-carjackings-so-dem-lawmakers-plan-ban-grand-theft-auto

 

            Reasons for optimism.

            https://www.adamsmith.org/blog/reasons-for-optimism-health

 

            New claim that Russia was behind JFK assassination---of course the authors are     CIA, which has also been implicated.

                https://nypost.com/2021/02/22/soviets-ordered-lee-harvey-oswald-to-kill-jfk-ex-cia-chief/

 

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