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

mercoledì 8 agosto 2012

Market Comment - August 8

(Marco Bonelli) How healthy and sustainable is an energy and basic materials driven stock market rally?

In the last three days, oil & gas and basic materials were the only sectors - besides technology - that appeared among the best performers every single day. Sure, it goes hand in hand with crude rallying 19.8%, heating oil up 18.5%, gasoline flying 25.2% from its respective lows end of June, followed by a recovery some industrial commodities that supported the run in the mentioned sectors. The only other sector that joined the leading group in the past three days was technology, while industrials appeared twice and financials only once. The undisputed group of underperformers since Friday gets occupied by the healthcare, utilities and telecom sector.

Overall, a not too healthy combination of leaders but as the latest leg of the rally is just three days old, let's not be too critical. At least small and mid-caps started outperforming large-caps after a dreadful months-long period of underperformance, which adds one positive ingredient to the risk-on rally, although only time will tell if that rebound (in relative performance) is the start of a longer trend or only a technical reaction.

Traders watch the SPX drop below the psychological 1400 level in the first minutes of trading as they have to deal with another round of disappointing economic data out of Europe, rising Spanish bond yields, a larger than expected rise of unit labor costs and the second consecutive month of disappointing sales from MCD. Not surprisingly, these data won't get perceived as "really new" news and it's unlikely that the newfound optimism regarding a second half recovery gets derailed by that. In this context, this and next week's earnings from retailers (M already started this morning with slightly beating Q2 estimates) as well as upcoming earnings from CSCO and DELL will be closely watched and each positive data-point will probably get utilized to support the "positive" outlook.

Although this traders' rally is based on very questionable hopes and depends on the "delivery" of certain scenarios, it's unlikely that the run towards the highs from last year is already over. As the current move is just a few days old, occasional reminders of the very slow growth environment and flat earnings growth might even act as a boost to the rally as the majority of investors remain skeptical of (but too afraid to sell) the levels stocks trade at and each single day the market moves higher. Needless to say that this process doesn't last forever if the hoped-for scenarios fail to materialize.

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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