Sunday, April 24, 2016

Stocks Finish Week In Volatile, Split Fashion; FOMC, BOJ To Drive Markets Last Week Of April

Nothing monumental was happening in the markets on Friday, but the mood was decidedly risk-averse heading into the weekend. The week as a whole mirrored Friday, with the Dow and S&P showing small gains while the NASDAQ took on water.

For the week:
DOW: +106.29 (0.59%)
S&P 500: +10.85 (0.52%)
NASDAQ: -31.99 (0.65%)

The week was among the lesser moves of the year, though it became apparent that the markets were testing the upper limits of their recent range. While the Dow managed to finish just above the 18,000 mark, the S&P remained at a critical inflection point at 2091-2092, almost by magic. Moving above the 2100 mark - which the SPX accomplished mid-week - may prove to be short-lived if investors take recent earnings weakness seriously, though that position is still debatable, considering the virtually unlimited power of the Fed and associated central banks in Japan (BOJ) and Europe (ECB) to print, cajole and promote inflationary, free-money policies.

Central banks cannot, however, remain the only vital force in the markets forever. More and more voices are beginning to openly question the intelligence of placing blind faith in the currency-controllers and are advising that a return to "normalcy" is something the Fed cannot and probably will not approach in the near term. Among them David Stockman, Jeff Gundlach, Bill Gross have been the latest to scoff at the Fed's financially-repressive control policies.

Notwithstanding the naysayers, the Fed, BOJ and ECB continue to stay the course. While Mario Draghi of the ECB didn't move markets one iota with his stand pat position this week, the Fed will likely accomplish little with their FOMC meeting this week (Tuesday and Wednesday), though the BOJ is considering lowering its key interest rate further into the red. The BOJ's next two-day policy review ends on April 28 (Thursday).

The coming week will be focused on central bank nothingness rather than fundamentals, which is what the complainers have been howling about for some time.

Expect their voices to become more numerous and louder if the global economy continues to sputter and stall.

S&P 500: 2,091.58, +0.10 (0.00%)
Dow: 18,003.75, +21.23 (0.12%)
NASDAQ: 4,906.23, -39.66 (0.80%)

Crude Oil 43.71 +1.23% Gold 1,234.90 -1.23% EUR/USD 1.1228 -0.55% 10-Yr Bond 1.89 +0.96% Corn 378.25 -2.95% Copper 2.27 +0.93% Silver 16.97 -0.73% Natural Gas 2.26 +2.13% Russell 2000 1,144.24 +0.75% VIX 13.34 -4.37% BATS 1000 20,682.61 0.00% GBP/USD 1.4413 +0.63% USD/JPY 111.6330 +2.02%

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