The Morning Call---Market flashes biggest divergence since Black Monday

 

The Morning Call

 

2/6/24

 

The Market

         

    Technical

 

            Monday in the charts.

            https://www.zerohedge.com/markets/bonds-bullion-banks-bitcoin-battered-good-news-bad-news-again-after-powell

 

            Long term, nothing is more bullish than all-time highs.

            https://theirrelevantinvestor.com/2024/02/03/nothing-is-more-bullish-than-all-time-highs/

 

            But short term, get ready for a dip.

            https://allstarcharts.com/divergences-add-up-ahead-of-rug-pull/

 

            Market flashes the biggest divergence since Black Monday.

            https://www.zerohedge.com/markets/market-just-flashed-biggest-divergence-black-monday-crash-1987

 

            Markets are anchoring on a potential Trump victory.

            https://www.zerohedge.com/markets/markets-are-now-anchoring-potential-trump-victory-ex-soros-cio-says-all-pullbacks-should-be

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

The January services PMI was 52.5 versus estimates of 52.9; the January composite PMI was 52.0 versus 52.3.

https://www.advisorperspectives.com/dshort/updates/2024/02/05/s-p-global-services-pmi-growth-accelerates-to-7-month-high

 

The January ISM nonmanufacturing index was 53.4 versus predictions of 52.0.

                          https://www.advisorperspectives.com/dshort/updates/2024/02/05/ism-services-pmi-expands-for-13th-straight-month

 

                        International

 

December Japanese household spending fell 0.9% versus consensus of +0.2%; December YoY average cash earnings were up 1.0% versus +1.3%.

 

December German factory orders were up 8.9% versus expectations of 0.0%; the December construction PMI was 36.3 versus 37.4.

The December EU construction PMI was 41.3 versus forecasts of 44.0; December retail sales fell 1.1% versus -1.0%.

 

The December UK construction PMI was 48.8 versus projections of 48.2.

 

                        Other

 

            The Fed

 

              The Fed is not as powerful as you think.

              https://www.forbes.com/sites/johntamny/2024/02/04/the-federal-reserves-sizeable-irrelevance-is-the-inflation-lesson/?sh=1a1112925792

 

                        Fiscal Policy

 

              Tax increases versus spending cuts.

              https://www.clubforgrowth.org/icymi-mcintosh-cass-debate-pro-growth-vs-populist-policies-the-deficit/

 

                          The great growth hoax.

              https://www.zerohedge.com/personal-finance/great-growth-hoax

 

                          This is how your government manages your tax dollars.

              https://www.zerohedge.com/geopolitical/waste-day-over-1-billion-weapons-missing-ukraine

 

                        Recession

 

              Don’t count on a soft landing.

              https://www.project-syndicate.org/commentary/biggest-risks-facing-world-economy-in-2024-by-kenneth-rogoff-2024-02

 

              Update on big four recession indicators.

              https://www.advisorperspectives.com/dshort/updates/2024/02/02/the-big-four-recession-indicators-january-employment

 

                          More on the problems in commercial real estate.

              https://www.advisorperspectives.com/commentaries/2024/02/04/industrial-size-surplus-john-mauldin

 

                The Financial System

 

              Banks reported tighter lending standards and weaker loan demand.

              https://www.zerohedge.com/markets/banks-report-tighter-standards-weaker-loan-demand-some-improvement-financial-conditions

 

 

                        War in the Middle East

 

              More signs of US impotence.

  https://www.nakedcapitalism.com/2024/02/more-signs-of-us-impotence-in-middle-east-overkill-yet-ineffective-strikes-deluded-reshaping-the-middle-east-planted-piece-hamas-blame-pre-positioning-for-probably-ceasefire-negotiation-fail.html

 

 

     Bottom line

 

            The strong jobs number confirms the bull thesis for stocks.

            https://investorplace.com/hypergrowthinvesting/2024/02/strong-jobs-report-confirms-the-2024-bull-thesis-for-stocks/

 

    News on Stocks in Our Portfolios

 

 

 

What I am reading today

 

            Quote of the day.

            https://cafehayek.com/2024/02/quotation-of-the-day-4534.html

 

            You can’t have it both ways.

            https://www.adamsmith.org/blog/exxon-knew

 

            How suspicion and intrigue eroded Alexander’s empire.

            How suspicion and intrigue eroded Alexander the Great's empire (nationalgeographic.com)

 

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