Reflation trade back on: crude up,dollar down, housing sales up

go here Crude oil futures continued their momentum today with October prices at a 2009 high of $74. The market followed as all four major stock indices reached 2009 intraday highs. Strong home sales for the 4th month in a row were one of the catalysts. July sales of existing homes jumped 7.2% the fastest sales pace in two years.
Metal stocks FCX and PAAS were up 4%. Gold stocks were up 2% as gold was up 1.5%. Energy stocks were strong with KWK ,SWN and XLE all up 3%. Treasury short ETF was at 49 up 3%. Bernanke fed the bull mood saying at the Annual FED conference at Jackson Hole that the US economy is on the cusp of recovery.
The US Dollar Index was weak down 0.4% at $78. Many economists believe that a weak dollar is the path to working off the debt from the real estate bubble. The IYR and XLF are up 2%.
The Rayno Life Science portfolio is up 11% YTD.
The market leaders this week are energy stocks. Monday brought out the bears with the S&P falling under 100 but four straight days of gains have brought the SPY to 103 agin of 4% for the werek. Skeptics and gloomer/doomers abound which is a bullish sign. Many traders are short with expectations of the usual Sep/Oct weakness. The market is currently at October/November 2008 levels and 46% above March 9,2009 lows.
Stay long commodity, healthcare and tech stocks.

No comments yet.

Leave a Reply

follow url