No6's Financial Markets Thread

[No6]

Maybe this needs it's own thread..

 

I'm going to be putting as much as half of my pension contributions into Japan over next few years. The Nikkei is being crushed by the absurdly strong JPY at the moment. Companies are finding it impossible to make any money in an export driven economy. Who knows how long this will last, but the fundamentals will shift into place eventually as foreign economies import less and produce more goods for themselves, and JPY imports more.

 

I've actually no doubt that the Nikkei will go lower (along with all other markets) as we ebb and flow through the secular bear market that began in 2000 (of which we are maybe 3/4 of the way through). It's a bit like if you bought gold at $240 or $300 or $400 you were still buying in the contrarian "phase 1" of a bull market.

 

One company that I am taking a close look at is Nintendo. Their shareprice is already down 2/3rds. This is a company that has a great history of reinventing itself and coming up with new products that seem to trump the competition. I think they will have a tough year in 2011 as their Wii product enters decline and everyone writes them off and their shareprice could slump a lot more, but that is precisely the time to buy, as I have no doubt at all that they will bounce back with a new line of fantastic products and games that everyone will want. They've been doing it for 40 years since the days of Donkey Kong on Game & Watch, and I would bet a lot of money on them doing it again.

 

I too like Japan, but the problem that I have with it is if there is a double dip elsewhere in the world 2011 onwards, I doubt that they would be immune from it. Japan's stock market is basically wedded to the more mature US and UK/European markets. I don't see any likelihood of decoupling. However, if there is no double dip or if it is mild, and markets continue to recover next year and beyond then Japan is so cheap by comparison that I can easily see it leading all the major markets.

[No6]

The latest below from Naked Trader, Robbie Burns blog.

 

The commentators have been telling us since, well foreever some massive downside is on the way. Indeed every week their articles get more and more desperate. Which is highly amusing considering they are supposed to be chartists and not allowing emotion to take over.

 

Everyone and his dog forecasts a big slide. Mainly because even I can see the charts are all showing a double top thingy. Well, it may happen but I have no intention of second guessing it so shall remain doing what I'm doing until it really does. Indeed one reader mailed me to say he'd given a sackload of money to a "trader" who promptly lost it all because he was convinced the markets were going to crash a couple of weeks ago and went "all in" short. Dear oh dear. The money's gone.

 

Interesting to see whether we are topping out around here or not.

 

http://www.nakedtrader.co.uk/index.htm

[No6]

After a strong start today, the FTSE has pulled back a little in line with the US. FTSE looks like it may well have already turned.

 

[littledavesab]

Some interesting comments on Japan on this thread

 

I also found Hugh Hendry's interview on KWN interesting - he talked about shorting the debt (in a clever way) of large Japanese industrials

 

I also remember Hugh on FBB (or Commodity Watch Radio as it then was) a couple of years back where he mentioned he likes 25 year cycles and Japan had (at the time) about 8 years to go to get back to its previous level (or have a good go)

 

[No6]

Japan's QE plans ahead.

 

BoJ Details Asset-Purchase Program

 

TOKYO—The Bank of Japan on Thursday unveiled key parts of its 5 trillion yen (US$61.5 billion) asset-purchase program, breaking new ground in its quest to vanquish deflation, and predicted that prices would end their long downward slide within two years.

 

http://online.wsj.com/article/SB1000142405...3510917940.html

[No6]

Some interesting comments on Japan on this thread

 

I also found Hugh Hendry's interview on KWN interesting - he talked about shorting the debt (in a clever way) of large Japanese industrials

 

I also remember Hugh on FBB (or Commodity Watch Radio as it then was) a couple of years back where he mentioned he likes 25 year cycles and Japan had (at the time) about 8 years to go to get back to its previous level (or have a good go)

 

And what is Hendry up to?

 

Prominent UK hedge fund manager, Hugh Hendry, the CIO and CEO of Eclectica Asset Management, has started taking short positions on China on expectations that the Asian powerhouse will slow down, reports the Financial Times this week. Very few fund managers are taking this stance, in large part because the very process of “going short” on China is extremely difficult; shorting Chinese stocks is tricky even for Chinese nationals. Fund managers looking to take a bearish stance are therefore required to explore indirect, proxy alternatives. Hendry himself is doing this by buying credit default swaps (simply put, a form of insurance) on Japanese corporate credits, believing these to be the instruments most likely to be affected by any form of contraction.

 

http://www.hedgeweek.com/2010/10/07/63716/...corporate-bonds

[jerpy]

One company that I am taking a close look at is Nintendo. Their shareprice is already down 2/3rds. This is a company that has a great history of reinventing itself and coming up with new products that seem to trump the competition. I think they will have a tough year in 2011 as their Wii product enters decline and everyone writes them off and their shareprice could slump a lot more, but that is precisely the time to buy, as I have no doubt at all that they will bounce back with a new line of fantastic products and games that everyone will want. They've been doing it for 40 years since the days of Donkey Kong on Game & Watch, and I would bet a lot of money on them doing it again.

 

Interesting you mention them. Caught a snippet on a BBC business round up and the above seems all the more likely, given the report below; you surely can't do worse as a retailer with a new product?

 

The firm has also been forced to delay the launch of the new 3D version of its DS hand-held console in the US until March, meaning it will miss out on key Christmas sales.

 

http://www.bbc.co.uk/news/business-11642428

[No6]

US consumer spending helps economy expand 2pc in third quarter

 

The US economy grew 2pc in the third quarter, boosted by consumer spending that rose at its fastest pace in four years, the Commerce Department said on Friday.

 

However, the expected expansion in gross domestic product between July and September was not enough to chip away at high unemployment or change perceptions of more monetary easing from the Federal Reserve next week.

 

While the US Commerce Department said consumer spending rose by 2.6pc - up from 2.2pc in the previous quarter - and business investment continued to expand, much of the rise in demand was met by imports - up 17pc - and domestic goods continued to pile up in warehouses, suggesting tepid growth in the fourth quarter.

 

http://www.telegraph.co.uk/finance/economi...rd-quarter.html

[No6]

UK property continues to slowly head towards its inevitable double dip.

 

Britain's property market in 'double-dip'

 

Britain’s property market is in the midst of a “double dip”, economists reveal, as figures show mortgage lending dropping to a tenth of the level seen during the previous month.

 

Net lending, which strips out redemptions and repayments, was just £112 million in September, down from £1.62 billion in August, according to the latest mortgage figures published by the Bank of England.

 

Lending figures are unlikely to pick up in the coming months as banks restrict the best deals to borrowers with substantial deposits.

 

http://www.telegraph.co.uk/finance/persona...double-dip.html

[drbubb]

FTSE has been weaker than the SPX in recent days / FTSE update

 

 

The 3d.MA has crossed below both the 8d and 21d MA's

 

In the past, FTSE has often led US markets lower.

 

By comparison, my favorite property bellwether, Barratt / BDEV ... update

 

... is on a nice "lazer beam" slide to the downside.

[No6]

FTSE has opened on a charge today, still doesn't look like it wants to fall at least not by much.

 

From Digital Look.

 

Week Ahead: US elections, US & UK QE, BP

 

The first week of November is a very busy one for UK corporate activity but, even so, activity may be eclipsed by events in the USA where the Democratic party is expected to get a battering in mid-term elections on Tuesday, while the Federal Open Market Committee of the US Federal Reserve will announce its decision on interest rates and quantitative easing (QE) on Wednesday. Throw in the always significant US non-farm payrolls data on the Thursday and you have a packed agenda, stateside.

 

Back on this side of the pond the Bank of England’s Monetary Policy Committee (MPC) will be making its own pronouncement on interest rates and QE on Thursday.

 

The better than expected third quarter UK gross domestic product data this week may have taken some of the steam out of the QE express, and it seems likely that the MPC will maintain the status quo, though the debate over whether to do so is likely to be a lively one.

 

In a week of big results, the biggest of the big is Tuesday’s announcement from stricken oil giant BP. Not only has the company got to withstand comparison with Shell’s announcement of an 88% increase in underlying third quarter earnings but much of the UK pension fund industry will be waiting for clues on when the dividend will be restored and at what level.

[No6]

One of the free newsletters that I receive is the Fibtimer Report, right now they put a good bull case with a possibility of a pullback.

 

The inverse head and shoulders looks compelling and seems to have been missed by many predicting a fall. Bears were pretty quick to jump on the 50/200 death cross a few weeks ago, but that has now reversed, we now have a 50/200 golden cross.

 

S&P 500 Index (SPX) Chart Analysis

 

Last week we wrote:

 

"The S&P 500 Index - SPX closed at a new weekly high Friday. One obvious difference is volume which is about 30% higher than it has been throughout this advance. In fact volume has been higher for two weeks. This appears to be a sign of distribution. Investors are taking profits but there are enough buyers to keep the SPX at its highs."

 

This week:

 

The S&P 500 Index - SPX continues to display signs of distribution, with volume above normal, lots of volatility, but little direction.

 

With the rally over extended this points to a stock market that is closer to some form of corrective activity. Whether we have a strong correction, a short pullback, a period of sideways consolidation or even higher highs ahead cannot be forecasted with certainty, but the odds of a correction have increased. The trend remains up, but all advances have corrections along the way.

 

[No6]

U.S. Stocks Rise After Best September-to-October Gain Since `98

 

U.S. stocks rose, with the Standard & Poor’s 500 Index adding to its best September and October performance in 12 years, as Chinese manufacturing expanded and data on personal incomes and spending highlighted the pressure on the Federal Reserve to boost economic growth.

 

==============

 

Stocks rose around the world today after data showed China’s manufacturing expanded at the fastest pace in six months in October, indicating the economy can bear more gains in the yuan and interest-rate increases to cool price pressures.

 

“China has clearly got us off to a good start,” Jim Reid, a global strategist at Deutsche Bank AG, wrote in an e-mail. “The undoubted highlight of the week is clearly Wednesday’s Federal Open Market Committee QE2 announcement. The truth is that none of us, including the Fed, know how much additional QE is needed.”

 

http://www.bloomberg.com/news/2010-11-01/u...confidence.html

[No6]

Nadeem Walayat sees a possible Dow correction to 10500-700 to mid November and then Dow target 12000 by Jan 2011.

 

http://www.marketoracle.co.uk/Article23909.html

[G0ldfinger]

I also found Hugh Hendry's interview on KWN interesting - he talked about shorting the debt (in a clever way) of large Japanese industrials

AFAIU, he "shorted" 10-year Japanese industrial bonds via credit insurance. He said something like "I am $2Bn short."

 

I agree with him that Japan (and China) must somehow be the first to go hyper.

[No6]

FTSE up again today on the back of some pretty good results.

 

Results from the big guns reporting this morning have generally been favourable, helping Footsie to notch up decent gains so far.

 

Beleaguered oil giant BP comfortably beat third quarter profit forecasts though it has had to take an additional $7.7bn charge in respect of the Gulf of Mexico oil spill. The market had been expecting underlying net income on a replacement cost basis to be around $4.5-$4.6bn, but after what it termed a “strong operating performance” BP boosted profits by 18% from a year earlier to $5.5bn.

 

Cigarettes maker Imperial Tobacco topped market forecasts with its full year profits, and took a big bite out of its debt mountain. Adjusted profit before tax in the year to 30 September rose 10% to £2,467m from £2,233m the year before. The market had pencilled in a figure of £2.320m. Net debt was reduced over the period by £1.5bn to £9.3bn.

 

BG Group grew third quarter earnings by 27% and now thinks there’s an extra 2.7 billion barrels of oil equivalent (boe) at its oilfields in the Santo Basin offshore Brazil, 34% more than previous estimates. Best estimates of gross resources in the Tupi, Iracema, and Guará fields increase to 10.8bn boe from 8.1bn boe before.

 

Better margins at its core banking business and bad debts under control kept state-controlled bank Lloyds on track over the past three months, despite 'subdued' loan demand. Impairments, or bad debts, have continued to decline and for the full year the level is expected to be in line with Lloyds' recent indications. Wholesale impairments will be lower than expected offset by higher Wealth and International charges, originating in Ireland and Australia primarily.

 

Insurer Aviva is on track to deliver strong profitable growth for 2010 after a decent third quarter following “good sales growth” from both life and general insurance businesses. Worldwide total sales were up 5% during the first nine months of 2010 at £35.9bn, long-term savings sales rose 6% to £28.6bn, and total life and pension sales also grew by 6% to £25.6bn.

 

Dettol and Lysol maker Reckitt Benckiser lifted third quarter profits by a fifth and has raised it full year targets thanks to strong strong sales growth in developing markets and a full contribution from its prescription pharmaceuticals businesses.

 

Bus and train group Stagecoach reported an increase in ticket sales at its train and bus operations in the first half and remains on track to meet profit expectations for the year. Like for like revenue at its UK rail business increased 6.5% in the 24 weeks to 17 October.

 

ADVFN Market Report

 

Along with some iteresting snippets of news.

 

The Saudi Arabian energy minister pushed up oil futures by $2 per barrel, after implying the powerful nation will not do anything to stop prices rising to $90. The comments will drive further fears of inflation, as transportation costs of consumer goods tends to rise with the oil price. Brent crude rose $2.06 to $85.21, as any signs about Saudi Arabia's plans for output can have a huge impact on the volatile oil market. Ali al-Naimi, the oil minister, told a conference in Singapore: "Consumers are looking for oil prices around $70, but hopefully less than $90. There's almost an anchor now for the price, the Telegraph reports.

 

A rebound in US manufacturing has handed ammunition to those at the Federal Reserve uneasy about further quantitative easing (QE), as the central bank starts its most important meeting since the depths of the crisis. Ben Bernanke, the Fed's chairman, has signalled to Wall Street that a second dose of QE is likely to be announced on Wednesday in a bid to fire up America's economic recovery, the Telegraph reports.

 

BAE Systems has been appointed a prime contractor to the FBI as the agency begins a $30bn overhaul of its technology. Europe’s largest defence company will provide the FBI with IT systems over the next eight years, the Times reports.

 

The US electricals giant Best Buy will launch an online shop in the UK within the next fortnight to take the fight to its rivals Currys, Comet and Argos on to the web. Best Buy, which opened its first UK store in May and now has five, will deliver across the UK, but not in the Channel Island or the Isle of Man, the Independent reports.

 

Tenants will be given the right to force their landlords to upgrade their homes with loft and cavity wall insulation, double glazing and new boilers, under government plans to increase energy efficiency. Local authorities will also be granted powers to require improvements to the 700,000 rented homes with the lowest ratings for energy efficiency. Landlords will face fines of up to £5,000 if they do not make the changes, the Times reports.

 

A total of 1.6m jobs will be lost across the economy as a result of the Government's deficit reduction programme – far more than so far admitted by ministers. According to the Chartered Institute of Personal and Development (CIPD), a leading labour market think-tank, spending cuts will account for 725,000 of those losses, the hike in VAT a further 250,000, and knock-on redundancies in the private sector will see 625,000 more posts disappear, the Independent reports.

 

Borrowing costs for Ireland and Portugal shot up as investors took fright at European proposals to force them to take a greater share of losses in future state bail-outs. The moves in the bond markets on Monday follow agreement at last week’s European Union summit on a Franco-German proposal on a mechanism to resolve future Greek-style sovereign debt crises, the FT reports.

[No6]

US markets seem to be quite calm considering that the elections may result in Obama's last two years being that of a lame duck President if the Republicans win big as seems likely.

 

Will US investors look to Europe?

 

The Federal Reserve’s pledge to buy more assets to shore up the economy is making European equities more lucrative for U.S. investors than domestic stocks.

 

The CHART OF THE DAY shows how U.S. and European investors fared since Fed Chairman Ben S. Bernanke said Aug. 27 the central bank “will do all that it can” to keep the recovery intact and may resort to buying securities, a strategy known as quantitative easing.

 

A U.S. investor buying the Euro Stoxx 50 Index made a 20 percent return up to the end of last week, compared with 13 percent from the Standard & Poor’s 500 Index. A Europe-based investor who bought U.S. stocks made 3 percent, trailing the 9.1 percent gain from local stocks. The dollar has slumped 9 percent against the euro in the same period as investors speculated that the Fed will announce more stimulus measures this week.

 

“While quantitative easing may boost asset prices in dollar terms, the hard-currency performance is set to lag,” David Shairp, global strategist at JPMorgan Asset Management, wrote in a report dated yesterday. “Aggressive expansion of central banks’ balance sheets represents a form of money illusion.” Hong Kong-based Shairp’s firm oversees $1.3 trillion.

 

http://www.bloomberg.com/news/2010-11-02/b...art-of-day.html

 

The Federal Reserve will probably introduce an unprecedented second round of unconventional monetary easing tomorrow by announcing a plan to buy at least $500 billion of long-term securities, according to economists surveyed by Bloomberg News.

 

Policy makers meeting today and tomorrow will restart a program of securities purchases to spur growth, reduce unemployment and increase inflation, said 53 of 56 economists surveyed last week. Twenty-nine estimated the Fed will pledge to buy $500 billion or more, while another seven predicted $50 billion to $100 billion in monthly purchases without a specified total. The remainder said the Fed would buy up to $500 billion or didn’t quantify their forecast.

 

http://www.bloomberg.com/news/2010-11-01/f...rvey-shows.html

[No6]

Posted on DrBubb's Trading diary.

 

Thanks for those positive comments.

 

NEW MOMENTUM TRADING Thread (incorporating the DrBubb moving averages)

 

I have decided to launch a new thread do include these longer comments which discuss Momentum trading and the usage of my Moving Average system*.

 

It has been in the background since the beginning, but I think it might be helpful to others if I discussed it more regularly, and in more detail.

 

The new thread will be moved to the Private Blogs section.

 

Link: http://www.greenenergyinvestors.com/index....showtopic=11727

 

== ==

 

*I always thought I would introduce these trading ideas in a book someday.

But maybe working to perfect it in a thread in the Members section will be a worthwhile start.

 

DrBubb, I am all for this but feel it will only be useful if it is applied to both bullish and bearish market moves. I suspect that had this been applied for most of the last 12-18 months there would have been far more bullish signals which would make the constant calls by bears for a possible turn in the market somewhat embarrassing. These moving averages are nice and simple and I have my own 3-10-40 EMA combined with other indicators which I find quite useful on most of longer timeframe charts. For example, a 3/10 crossover to the upside on the FTSE100 happened in the last couple of days on the daily chart indicating there might be more upside to come. Even though I wouldn't take such a move in isolation, other indicators like stochastics, MACD and ADX seem to be heading for a crossover on the upside too. We will see.

 

[littledavesab]

Well, if someone in the city wants to offer me a nice job with a six figure salary and nice austerity bonus, I'm open to offers.

 

No point in saying they could do a lot worse - they do, do a lot worse and frequently

 

Just wanted to say, am still watching your thread with interest No6 and am trying to restrict myself to useful comments rather than innane ramblings. Your thread and Bubbs diary is a great education.

 

My own investing stategy has become very confused over the last few years and is something I need to think more on. Moved from being a long only type, to still being a long only type following longer term trends and being very nervous! Have tried hedging strategies of going with the inverse UKXS once or twice but thats about it. I could claim to be a genius and that I have been long since March 2009 - but then I would have to admit not selling when the market tanked in 2008! I have really just been watching the confidence levels and since the market recovered in March 2009 it has shaken on occasions but has not suffered the shock panics that we saw before and therefore I (hope) confidence remains intact.

 

Trouble is I am not sure if watching out for confidence alone is sufficient.

The market has certainly been frothy recently and has been a nice ride. Cannot help feeling some sort of pullback is overdue.

 

Hope that was a worthwhile comment!

[No6]

No point in saying they could do a lot worse - they do, do a lot worse and frequently

 

Just wanted to say, am still watching your thread with interest No6 and am trying to restrict myself to useful comments rather than innane ramblings. Your thread and Bubbs diary is a great education.

 

My own investing stategy has become very confused over the last few years and is something I need to think more on. Moved from being a long only type, to still being a long only type following longer term trends and being very nervous! Have tried hedging strategies of going with the inverse UKXS once or twice but thats about it. I could claim to be a genius and that I have been long since March 2009 - but then I would have to admit not selling when the market tanked in 2008! I have really just been watching the confidence levels and since the market recovered in March 2009 it has shaken on occasions but has not suffered the shock panics that we saw before and therefore I (hope) confidence remains intact.

 

Trouble is I am not sure if watching out for confidence alone is sufficient.

The market has certainly been frothy recently and has been a nice ride. Cannot help feeling some sort of pullback is overdue.

 

Hope that was a worthwhile comment!

 

As the saying goes, the market climbs a wall of worry. A pullback is most certainly due and we will then see if the support levels hold. Right now the balance between good and bad news is fairly even, but the chances of big shocks ahead are still likely. In the UK it is still not clear how the private sector will pick up the slack for public sector cutbacks and in the US we will have to wait and see how Obama and the Fed respond to a New Republican Congress.

 

Here is one view which the markets may like once the dust has settled and compromise reached.

 

Republican Win May Be Tax Boon for Companies, High Incomes

 

Americans with the highest incomes and U.S. corporations, especially those with international operations, stand to be big winners as newly elected congressional Republicans signal they will extend existing tax benefits and push for new ones.

 

Republicans will use their new majority in the House to bolster their campaign to extend Bush-era tax cuts for those earning more than $250,000. They’ll also side with companies such as International Business Machines Corp., Microsoft Corp., Blackstone Group LP and Occidental Petroleum Corp., which have lobbied against President Barack Obama’s proposals to increase taxes on overseas profits.

 

“Republicans have pretty much staked their claim that they’re not going to raise taxes,” said John Feehery, who was an adviser to former House Speaker Dennis Hastert, the last Republican to hold that top post. “Republicans are much more cognizant and care more about the financial impact of these taxes on jobs.”

 

==================

 

‘Pillaged by Congress’

 

Businesses “are not going to be seen as a pool of funds to be pillaged by Congress anymore,” said Curtis Dubay, a senior tax policy analyst at the Washington-based Heritage Foundation, a research organization that usually sides with Republicans.

 

Still, even with the gains in the House, the Republicans will need to reach compromises with Democrats to achieve anything of substance. The president has veto power and the Democrats retain a majority in the Senate that allows them to prevent any measure from getting the 60 votes required to overcome procedural hurdles.

 

Immediately at stake is the renewal of more than $5 trillion of tax cuts passed in 2001 and 2003 that expire Dec. 31. These include lower income-tax rates and reduced rates on most capital gains and dividends.

 

Republicans want the cuts extended permanently for all Americans; Obama and most Democrats favor extending them only on the first $250,000 of a couple’s income. The parties also disagree on what to do about the estate tax, which was repealed for one year for 2010. Failure by Congress to act would trigger $400 billion in scheduled tax increases this year and next.

 

http://www.bloomberg.com/news/2010-11-03/r...gh-incomes.html

[No6]

Another comment worth taking note of. Not sure if the comment is totally true, but I suppose the advantage of gridlock is that Government does nothing silly, a form of limbo exists and both sides will be thinking of the next election so they are more likely to compromise and take credit for anything that works. Neither side will want to look as if they are the one creating trouble. Sometimes doing nothing is good.

 

The Fed will probably restart buying bonds to fuel economic growth, pledging to purchase $500 billion or more in securities, 29 of 56 economists in a Bloomberg survey said. Republicans gained at least 60 House seats yesterday, capitalizing on concern about government spending and delivering a rebuke to President Barack Obama’s domestic agenda, while Democrats retained control of the Senate.

 

“Investors are in a wait-and-see mode,” said David Kelly, who helps oversee $445 billion as chief market strategist for JPMorgan Funds in New York. “The market does best with a divided government because that brings down uncertainty. However, the outcome of the election had already been anticipated. On top of that, people are not willing to make a big call ahead of the Fed announcement.”

[No6]

Here's someone who is bullish.

 

Billionaire Ken Fisher Sees 16% S&P 500 Rally After Elections

 

The Standard & Poor’s 500 Index may rally as much as 16 percent in the next six months because yesterday’s election will stymie legislative initiatives in Congress, billionaire investor Kenneth Fisher said.

 

Equities have surged since July as odds that Republicans would take control of the U.S. House of Representatives increased. President Barack Obama and the Democratic Party pushed through reforms of the health-care and financial industries this year.

 

“Markets don’t like big sweeping actions,” said Fisher, who oversees more than $38 billion at Woodside, California-based Fisher Investments Inc. “Right now, every politician is chirping and burping and carrying on. It’s been in the interest of the Republicans running for office to talk down the economy. That goes away immediately after the election. Come June, you’ll see how quiet the political landscape will be -- very little legislation and a lot of baby kissing.”

 

Fisher’s optimism is based in part on history. Stocks average gains of 11 percent in the third year of U.S. presidencies and haven’t fallen since 1939 when the Dow Jones Industrial Average lost 2.9 percent, according to data since 1833 compiled by the Stock Trader’s Almanac. The fourth year, when elections are held in November, is second-best, with an average advance of 5.8 percent.

 

http://www.bloomberg.com/news/2010-11-03/b...n-gridlock.html

[No6]

Fed news is in.

 

Fed to Buy Extra $600 Billion of Treasuries to Boost Growth

 

The Federal Reserve will buy an additional $600 billion of Treasuries through June, expanding record stimulus and risking its credibility in a bid to reduce unemployment and avert deflation.

 

Policy makers, who said new purchases will be about $75 billion a month, “will adjust the program as needed to best foster maximum employment and price stability,” the Fed’s Open Market Committee said in a statement in Washington. The central bank retained its pledge to keep interest rates low for an “extended period.”

 

http://www.bloomberg.com/news/2010-11-03/f...aid-growth.html

 

U.S. Stocks Rise as Fed Announces Additional Treasury Purchases

 

U.S. stocks advanced, with banks helping benchmark indexes erase losses, after the Federal Reserve announced an additional $600 billion of Treasury purchases through June in a bid to boost growth in the world’s largest economy.

 

http://www.bloomberg.com/news/2010-11-02/s...ted-to-win.html

 

Canadian Stocks Erase Their Losses as U.S. Fed Announces Asset Purchases

 

“It’s money in the system, and stocks love liquidity,” said Doug Davis, chief executive officer of Davis-Rea Ltd. in Toronto, which manages C$400 million ($394 million). “Some people just need confirmation. They were just waiting for the real thing.”

 

http://www.bloomberg.com/news/2010-11-02/e...ty-preview.html

[No6]

FTSE on a roll this morning, up close to 100. They like the US QE announcement and the 3/10 crossover which I pointed out yesterday was a jump the gun on this news. No point fighting the trend.

[drbubb]

Here's someone who is bullish.

Billionaire Ken Fisher Sees 16% S&P 500 Rally After Elections

 

He's always bullish.

My brother-in-law opened an account with them. and lost plenty in 2008.

 

== ==

 

Momentum was strong on the close in NY yesterday, and should carry over into today.

 

Asia up 1.5% - 2.0%. Let's see if Europe can keep the good times rolling