Stocks Soar Through January; Big Week Upcoming

Stocks staged their best cumulative effort of the new year, as January equity returns continued to explode through the final full week of trading in the United States.

Making the gains all the more impressive is the fact that the month has seen only 18 out of a possible 20 trading days, due to the New Year and MLK holidays falling on Mondays. Three more sessions to start the new week will conclude January trading.

Stocks have been the major story of the year thus far, along with the continued decline of the US dollar against other major currencies, especially the Yen, Euro and British Pound.

President Donald J. Trump returned from Davos over the weekend, preparing for his first State of the Unions address to congress on Tuesday night.

Also of note this week is the FOMC policy rate meeting of the Federal Reserve. While the Fed is not expected to raise key interest rates at this meeting, there's general impetus for a planned rate hike at the March meeting. The FOMC meets on Tuesday and Wednesday, January 30 and 31. The March meeting is March 20-21.

The week concludes with the January Non-farm Payroll release by the BLS on Friday, Feb. 2. The data release includes publication changes related to the annual sample review and the conversion to NAICS 2017.. Expectations will be high, given the explosive nature of the stock market and recent touting of strong economic growth by President Trump.

At the Close, Friday, January 26, 2018:
Dow: 26,616.71, +223.92 (+0.85%)
NASDAQ: 7,505.77, +94.61 (+1.28%)
S&P 500: 2,872.87, +33.62 (+1.18%)
NYSE Composite: 13,637.02, +124.36 (+0.92%)

For the Week:
Dow: +544.99 (+2.09%)
NASDAQ: +169.39 (+2.31%)
S&P 500: +62.57 (+2.23%)
NYSE Composite: +252.56 (+1.89%)

Dow Soars

Really?

At the Close, Thursday, January 25, 2018:
Dow: 26,392.79, +140.67 (+0.54%)
NASDAQ: 7,411.16, -3.89 (-0.05%)
S&P 500: 2,839.25, +1.71 (+0.06%)
NYSE Composite: 13,512.66, +5.00 (+0.04%)

Stocks a Little Shaky As Dollar Plummets, Silver, Gold Soar

Chalk this up to various theories of unintended consequences.

Even the brilliant thinkers at the Federal Reserve are unable to explain the strange divergence of bonds and the dollar over the past number of weeks because that's not the way it's supposed to go.

With the Fed becoming more hawkish as they attempt to unwind literally trillions of dollars worth of bonds on their vast balance sheet, interest rates have risen, but the value of the dollar in relation to other major currencies has taken a noticeable hit, not just in the past few weeks, but for the better part of the past year.

The mighty US dollar was beaten like a trailer park hooker, down nearly one percent on the day per the dollar index, which, in the forex universe, is a pretty severe move.

Other currencies were the beneficiaries of the dollar demise, with the British pound up 2.4%, Japan's yen up nearly one percent, and the Aussie dollar gaining 0.90%.

Fueled by Treasury Secretary Steven Mnuchin's comments at the World Economic Forum in Davos, Switzerland, that a weaker dollar was good for US trade, currency pairs were traded with one thing in mind: dollar dumping.

Bonds, however, failed to play along, with the 10-year benchmark unchanged at 2.65% and both long and short-dated maturities moving less than a basis point.

Besides the currencies of nations not the United States, commodities were bid large, with WTI oil futures making another in a series of three-year highs and precious metals continuing a rally that began in December but had recently stalled.

Not so today, as silver led the way with a gain of over three percent, topping out at 17.70, the highest since breaking briefly over $18 per ounce in early September of 2017. From a technical perspective, silver has ripped through a long, declining resistance line dating back to its peak in 2011. A clear breakout holding above $17.50 would be a significant development for the world's most unappreciated asset.

Gold was also well-taken, finishing in New York up $16.80 (1.50%), at $1358.70 the ounce.

Stocks meandered along the unchanged line, ending split, with the Dow higher while the NASDAQ and S&P fell.

With many pension funds chartered to rebalance by month's end, the rapid rise of equities in the early days of the new year may be coming to a quick conclusion. Estimates range from $12 to $120 billion of stocks which must be sold and converted to bonds in the next week. If that's the case, it will take a concerted effort from the central bank cartel (who also may be selling into the weakness) to keep the stock bubble adequately inflated.

If there's a downside other than stocks taking a much-needed shave, it's that any decline in the stock market will be blamed on President Trump and his administration's tough currency and trade policies.

The President is set to address the assemblage at Davos on Friday, concluding this year's fete of economic manipulators and would-be statist social constructionists.

The President is expected to deliver remarks touting America's re-emergence as the world's greatest economic force.

At the Close, Wednesday, January 24, 2018:
Dow: 26,252.12, +41.31 (0.16%)
S&P 500: 2,837.54, -1.59 (-0.06%)
NASDAQ: 7,415.06, -45.23 (-0.61%)

Revenge of the Gold (and Silver) Bugs As Dollar Crashes

Stocks may be hurtling towards infinity and beyond, but the long-suffering holders of gold and silver are about to be rewarded for their patience and prescience.

Overnight, the dollar index breached the 90 level to the downside extending the trend which saw the dollar lose the most value in 14 years in 2017.

As the dollar falls, gold and silver can do nothing but appreciate in dollar terms, and with Treasury Secretary Steven Mnuchin speaking out in favor of a weaker dollar, the trend seems set to accelerate.

Meanwhile, the US Postal Service continues to cater to the Amazons of the world by hiking postage rates (particularly to retail and the lowest tier of commercial rates, Commercial Base) and punish small business.

Likewise, cell carrier Verizon continues to throttle the speeds of users of its "unlimited" bandwidth service in spite of regulations and court rulings which forbid the practice.

The corrupt news media continues to taunt the public with stories that President Trump is about to be grilled by special prosecutor Robert Mueller in the "Russiagate" probe, while all along the true traitors are still employed by the FBI and Department of Justice.

It seems that the tree of liberty is ready to be to be quenched again.

At the Close, Tuesday, January 23, 2018:
Dow: 26,210.81, -3.79 (-0.01%)
NASDAQ: 7,460.29, +52.2568 (+0.7054%)
S&P 500: 2,839.13, +6.16 (+0.22%)
NYSE Composite: 13,474.11, +3.74 (+0.03%)

Trump and Republicans Carry the Day (and Water) for Wall Street

Just to be certain that the big government shutdown over the weekend was a big puff of smoke that left nothing other than a fog and stench, here is a comment made by a presumably knowledgeable person on how big business perceives the machinations and meanderings of the politicians in Washington, DC.

So far Wall Street is the dog that didn't bark in the night time. Indeed, all of Big Business is.

I work coordinating business meetings, mostly for Fortune 500 companies; the companies that spend enough on meetings to bother hiring professionals to handle them. I'm usually pretty busy during these meetings, but I keep an ear open for interesting tidbits when I can, and sometimes I have nothing to do but listen to every word.

Usually these companies do discuss politics, and how they plan to position themselves vis-a-vis the political climate. Not lately, they haven't been. Almost nary a peep. And that includes pharmaceutical companies, which usually are about as attuned politically as anyone.

The companies I work for, and you've heard of them, are ignoring:

- Attempts to change ACA (they know the entire healthcare finance system is already broken anyway, and they have to buy their employees health insurance no matter what happens so they don't care);

- Efforts to raise the US minimum wage to $15/hr. (they're already planning to raise pay because they can't hire people at the prevailing suppressed wages);

- The tax bill (they already pay corporate taxes at an effective rate so much lower than the headline rates it doesn't matter, and their top executives already mask most of their income from the tax system so effectively no legislation conceivable in the current political climate matters at all to them);

- Immigration (they simply don't care because they have no liability or consequences no matter what);

- Carbon-based fuels (they're all getting out of them anyway because they're too expensive and inefficient; if Trump wants to subsidize them while they're doing it they're fine with that);

- Government regulations (they pay their way out of them anyway, one way or the other, and write off the costs);

- Global trade agreements (all the methods they use to evade existing duties, tariffs and sanctions supersede such things anyway); etc.

- War and rumors of war (None of the wars involve or will involve anything they have an interest in. They have deep enough contacts to know there isn't going to be a nuclear war, and no other wars on the table pose more risk than profit opportunities to corporate interests);

- Ethics investigations, "RussiaGate," Uranium 1, PizzaGate, FISA-gate, or any of the popcorn nonsense dominating the partisan media (who invented ad campaigns in the first place?).

Indeed, most of the issues we concern ourselves with don't even interest the executives of the biggest corporations in America.

This is reflected in Wall Street. Where it matters, they know they've got the system dicked. It simply doesn't matter to them one way or the other, which faction of the Oligarchy has the upper hand today or tomorrow.

Here's the link to the comment (from a site on which the Money Daily staff has been banned twice for speaking truth to power).

Thus, stocks gained on the eve of the shutdown and also on the end of the shutdown. The shutdown was bad theater engineered by obstructionist Democrats who have nothing left in their quiver of attack arrows outside of assiduously assaulting the sitting president.

...and, apparently, it wasn't even close to being enough, as their gambit blew up in their collectivist faces, and especially so on the visage of one NY Senator Chuck Schumer, a sell-out to his constituents and to his party.

At the Close, Monday, January 22, 2018:
Dow: 26,214.60, +142.88 (+0.55%)
NASDAQ: 7,408.03, +71.65 (+0.98%)
S&P 500: 2,832.97, +22.67 (+0.81%)
NYSE Composite: 13,470.37, +85.91 (+0.64%)