How an a rally be dull?
When it's a staged annual event designed only to enhance confidence in the markets, lasts only one day and the bulk of the gains occur in the first fifteen minutes of trading, that qualifies as dull and that's what we had today.
Last year, stocks showed the same kind of activity on the first trading day of the new year. Did it help? Maybe, for the first four months, but markets topped out in late April and ended the year nearly flat and about 5-7% below the 2011 highs.
Today's opening bell ramp job also featured low volume, now a trademark of a market where individual investors are uncomfortable and have been pulling out money since the 2008 collapse, but especially since the flash crash of 2010.
The reasons for today's jump at the open were rather obvious. europe didn't implode over the holidays and the Euro was up against the US Dollar. That's all the traders and fund and portfolio managers needed to know to give the thumbs up for a "risk on" session as has been the pattern for the past 18-24 months.
Tomorrow or next week or next month, there will be more volatility from a failing Euro, a political flap or shoddy earnings reports and this rally will be forgotten, as all others have been. It's just the "new normal" of a market dominated by a few, well-heeled, major players.
Just as last week was dull for the absence of volume and price swings, this week promises a new kind of dullness, as stocks rally for no good reasons other than everybody wants to feel good about stocks.
Besides, the real money today was made in oil futures - up 4.18% thanks to Iran's sabre-rattling - and silver - up 5.94%.
Dow 12,397.38, +179.82 (1.47%)
NASDAQ 2,648.72, +43.57 (1.67%)
S&P 500 1,277.06, +19.46 (1.55%)
NYSE Composite 7,624.33, +147.30 (1.97%)
NASDAQ Volume 1,656,354,375
NYSE Volume 3,901,734,250
Combined NYSE & NASDAQ Advance - Decline: 4326-1409
Combined NYSE & NASDAQ New highs - New lows: 277-35
WTI crude oil: 102.96, +4.13
Gold: 1,600.50, +33.70
Silver: 29.57, +1.66
Tuesday, January 3, 2012
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