- Intel and other semi-conductor stocks did not have good mid-quarter updates. More correctly the updates were not received well by the market. Since November 1 the semi-conductor sector as measured by the Semi-conductor HOLDR was up 14.9% before the Texas Instruments update yesterday. That compares a 4.5% lift for the S+P 500 in the same time frame. Point being semis have been an important market leader that looks to be rolling over.
- Merck and GM continue to make bad news. I think these are both just train wreck types of stories as opposed to market moving stories but if GM fails it will become a market moving story.
- I think 1180-1270 in the S+P 500 was the rally. From here it could move up a little more but we have seen the bulk of the lift. A 90 point move in the index exhausted a lot of buying power. Chasing too much risk now, after a big move, may not work out too well.
- The big rally in the US dollar looks like it may be rolling over as well. A big part of this rally has been the repatriation of dollars for a tax break. This has a finite time limit so this will no longer be a source of demand for US dollars.
- Bond yields in the middle of the curve are quite flat and staying low. I have said before on the show that the reissuance of the 30 year bond by the treasury should push rates on the ten year higher. I still believe that but if I am wrong that means we will have an inverted curve. Unlike many other folks I am not will to bet that an inverted curve will be different this time.
Thursday, December 08, 2005
I will be appearing on Asian Squawk Box tonight at around 8:10 pm EST. Here is a list of things that might come up.
Posted by Roger Nusbaum at 3:24 PM