US equity indexes closed broadly higher, sp +17pts at 2355. The two
leaders - Trans/R2K, settled higher by 1.7% and 1.2% respectively. VIX settled -5.2% at 14.15. Near
term outlook threatens a little weakness, with the market primed to
settle opex/weekend around 2350.
sp'daily5
VIX'daily3
Summary
The moderate swings continue, with today seeing the market managing some broad upside. A minor gap of 2353/57 was filled, Mr Market washed out the sp'2360 short-stops, before some cooling into the close.. partly due to what appears to be another Paris terror attack.
*Notably, the Nasdaq comp' is a mere 10pts from breaking a new historic high (5936). The 6000s are clearly within range before end month.
Market volatility remains naturally subdued... with the VIX back in the low 14s. The 13s are clearly viable tomorrow, but the 12s look out of range, as we have the uncertainly of round one of the French election this Sunday.
US equity indexes closed mixed, sp -4pts at 2338. The two leaders -
Trans/R2K, settled higher by 0.5% and 0.4% respectively. VIX settled +3.5% at 13.94. Near term
outlook offers chop into opex/weekend. A big push to new historic highs
in the sp'2400s looks out of range until early May.
sp'daily5
VIX'daily3
Summary
There is little to note, on what was just another day of moderate swings. Price action is set to remain choppy into this Friday's opex. Clearly, the French election (April 23rd AND May 7th) will be a cloud over US equities, as the mainstream are a little concerned that someone 'not conventional' might be elected.
Volatility itself remains naturally subdued, seeing the mid 13s in the morning, but leaning upward into the afternoon, as equities cooled.
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One of the more kooky videos of the day...
... and that was somewhat in sync with what Fed official Rosengren was speaking about today.
The Fed will burn ALL deflationary bears
Rosengren covered a fair few things today. First, there was the issue that the fed balance sheet is due to start being reduced within a few months. However, that will surely go no lower than around 3.5 trn when the next recession hits. Then there was the issue that 'asset buying' was to be seen as the 'new norm' whenever a recession hits.
Lets be clear... the Fed will be more than willing to print TENS of trillions in the 2020s to keep the game going. The deflationary collapse scenario will simply NOT be allowed to happen.
Further, it was made clear that with a recession, rates will again be reduced to near zero. The implications for long term savers are of course dire, but hey, when did the fed/societal elite ever care about that?
US equity indexes closed moderately mixed, sp -6pts at 2342 (intra low
2334). The two leaders - Trans/R2K, settled -0.6% and u/c respectively.
VIX settled -1.6% at 14.42. Near term outlook offers another moderate wave higher to the
sp'2350/60s. Broadly, a push to new historic highs in the 2400s now
looks out of range until early May.
sp'daily5
VIX'daily3
Summary
US equities opened moderately weak, partly weighed by a (moderate) earnings miss from GS, but more so, the news of a UK election. An opening reversal failed to hold in early morning, with another wave lower to sp'2334. From there, a rather standard (if choppy) latter day recovery.
Volatility was itself choppy, and with a moderate equity recovery in the afternoon, even turned negative into the close.
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Meanwhile, in the land of yours truly...
PM/Conservative leader May has called for an election. I feel inclined to reference Palpatine...
Seriously, its a very shrewd political move. The main opposition party 'Labour' (the UK version of the democrats), is deeply fractured, and are trailing in the polls by around 20pts.
May* is seizing the opportunity to greatly increase her parliamentary majority, and safely 'bank' a further five years of power to summer 2022. Unlike the French elections, there is near zero doubt on the outcome of the June 8th UK election.
Naturally - even though the result is clear, the UK equity/capital market will be somewhat clouded until the election is out of the way.
A brief look at the UK equity market....
FTSE 100, monthly, 20yr
Last year's break above 7k was massively decisive.That is now core support, and should hold into the June election. If you backwards extrapolate, you have to start from 10k before the next major decline can begin, and that is clearly not viable any time before late spring 2018.
If you believe that, you should also recognise there are indirect implications for the US market.
Goodnight from London
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*I'm not suggesting May is on the level of a Sith Lord, but her voting pattern across the last decade is pretty dark sided.
