Il Primo Ministro greco Lucas Papademos riceve l'approvazione del governo su tagli al bilancio che corrispondono al 7% del Pil nei prossimi tre anni e su una ristrutturazione finalizzata a ridurre di €100 mld gli oltre €200 mld di debito detenuto dai creditori privati, atteso il voto del parlamento • Standard & Poor's declassa il merito creditizio di 34 banche italiane tra cui UniCredit a BBB+ da A, Intesa Sanpaolo a BBB+ da A e Banca Monte dei Paschi di Siena a BBB da BBB+, S&P anticipa "una redditività decisamente debole per le banche italiane nei prossimi anni" • La produzione industriale italiana aumenta a dicembre +1,4% da novembre +0,3%, oltre le stime degli economisti +0,5%, anche se i dati del quarto trimestre -2,1% suggeriscono che la terza economia della zona euro è entrata nella seconda recessione dal 2009 • I Btp decennali salgono per la quinta settimana consecutiva, il periodo di recupero più lungo in oltre cinque anni, la prossima settimana il Tesoro vende €4 mld di buoni al 6% con scadenza 2014 • L'euro cala dal massimo di due mesi contro il dollaro, il mercato azionario europeo cala dal massimo di sei settimane e l'azionario Usa registra la prima settimana di perdite del 2012 dopo che i ministri delle finanze europee non hanno concesso il pacchetto di aiuto necessario a prevenire il collasso economico della Grecia

giovedì 15 marzo 2012

Market Comment - March 15

(Marco Bonelli)

"The heat is on, on the Street
Inside your head, on every beat
And the beat's so loud, deep inside
The pressure's high, just to stay alive
'Cause the heat is on..."

This song from 1985 probably serves as a great description of the atmosphere in the markets today.


Some commentators were disappointed yesterday that the rally didn't carry on and were even questioning if the rally finally runs out of steam as they didn't see a continuation of asset-allocation shifts out of bonds into stocks. In a certain way, this snap-shot catches the comfort level (complacency!) of market participants who are getting used to steady gains without any breaks but how surprising was it that the SPX couldn't move higher than 1399.42 (how many attempts did the Dow Jones need to finally take the 13000 level?) and how surprising was it that the market consolidated the gains from Tuesday. Although market breadth was considerably negative, there wasn't a lot of profit-taking in Tuesday's winning sectors, financials, technology and industrials (the worst performers yesterday were utilities, energy, basic materials and telcos for obvious reasons in the commodity  markets), so let's call it a solid consolidation.

Regarding commodities and energy, the heat in the crude oil speculation disappeared a little bit while natgas continues to slide and gasoline continues to grind higher, nevertheless metals gave up some gains and the CRB Index fell back to the uptrend from 2008. In the recent excitement about the economic recovery, high crude and gasoline prices get pretty much ignored or -along with the Fed's assessment - put into the temporary drawer. Among cyclical sectors, only the Dow Jones Transportation Index showed sizeable weakness but as the transportation sector was the lonely sector that already showed weakness beginning of February, why should investors pay attention now, right (particularly since economic numbers, especially several manufacturing indexes continue to show (questionable) gains and confirm the recovery scenario)?

The action in the bond market is almost more interesting than stocks (30yr yields rose from 3.03% to 3.40% in two weeks, 10yr yields from 1.9% to 2.27% and even 5yr yields from 0.82% to 1.11%), a move that will probably continue to benefit stocks and the Dollar. Even as investors might still have troubles buying at current elevated levels and confusion about the direction of the stock market in the next few weeks persists, the break-out to new highs creates a nice playground for traders, who will go day by day and don't care too much about the real fundamental picture as long as expectations are high! It would actually be surprising if the recently hot financial sectors didn't move higher, short-term speaking!

Trade well.


(Marco Bonelli is the Managing Director of International for CL King & Associates in New York. The opinions expressed are his own.)

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