Here comes Santa Claus!! Better late than never as investor enthusiasm bubbles over, a stark contrast to last weeks' depth of pessimism. Positive vibes out of the Federal Reserve meeting are a key ingredient with the coming rise in interest rates pushed down the road. The breakthrough with Cuba, while not a major economic event, lowers the level of international tension by a few degrees, and further isolates Russia. Economic sanctions and the fall in the price of oil are crushing the Russian economy with the US seemingly winning this international conflict without firing a shot. Spillover to the European economy from Russian sanctions are hampering efforts to pull the Eurozone out of recession but overall it appears that the strategy is working. Today's markets are continuing the amazing rally that started yesterday morning. Oil seems to have found a bottom and that is encouraging because it can help energy companies better plan for capital spending next year. Even commodities are looking up, after sagging for the last few months. It is definitely a risk off go-go scenario with the greatest risk to short sellers who are getting squeezed, being forced to buy back stocks to cover losing positions. Interest rates continue to fall with the 30 year mortgage under 4%. Expect these index levels to continue upward as short sellers are squeezed out of the market.
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