Another Dull Day at the Office

On Monday, the market heard that the LEI, the leading economic indicators, had fallen a mild 0.2%, very much in line with the 0.3% forecasters had estimated.  One of the problems was that last month’s number was revised downward quite a bit, from up 1.1% to up only 0.5%.  Tuesday brings the PPI and we know what a crowd pleaser that number can be—Not.  The inflation numbers have really not been on the market’s radar screen for quite a while.  What’s on the Wednesday Update radar screen happens to be the housing numbers that are coming out later in the week.  We’ll see if the market can be stirred by these numbers, probably not.

Among other factors at work on Monday was the drop in oil prices of over $2 but not below $60 just yet.  Then, there was the ORCL (Oracle) earnings news after the close which had a negative effect on the price of that stock.  Later in the evening, the new Fed Chairman graced the world with a speech were he basically said he doesn’t know why longer term rates haven’t moved up as the Fed has pushed short rates up, but not to worry, the Fed doesn’t have a problem with the inverted yield curve.

For a Monday the market didn’t seem to have much life in it.  In the early going, the market did manage a little pop but that quickly faded and there was pretty much a flat line across the rest of the day, more or less a yawn of a day.  There is little to report either in economic news or market news.  Yes, the NASDAQ Comp was up a little but there is still a lid on it at 2325; and then there is still the January high of 2331.  This area has brought much resistance to the Comp over the past several months while the Dow has continued higher.  Now, the market is becoming overbought once again without much upside potential, it just appears tired.

By the way, we have re-assessed our thought on the momentum high.  We have said that the momentum high happened back in January.  Well, after looking at it again, we see that the momentum high was back in late November, with price highs occurring now in the Dow.  We think it’s just a matter of time at this point before the market rolls over in a big way.  Don’t be in its way.

Be careful out there…

Dow Industrials:  11,274.53  -5.12
RYVNX:   18.54
RYAIX:  21.94
TLT:  88.99
BEGBX:  13.11