Investors continue to focus on Europe. And today there were a few meaty headlines to consider:
Greece: Papandreou is out. New head of interim government to be named Tuesday. Who will it be? And are they in favor of accepting bailout deal?
Italy: Rising rates are becoming a problem. Berlusconi’s coalition treading on thin ice. Are they the new Greece…just 10 times larger???
These headlines had markets down slightly in Europe. That usually means weakness for US stocks as well. That was the case early in the session, but stocks kept rallying into a modestly higher finish.
What does that mean for Tuesday? Nothing.
Each day brings fresh headlines and a recalibration of the odds of success in Europe. Until better contained, then simply no way for stocks to press beyond the 1285 mark we hit on October 28th.
However, I had an interesting thought. If you read most investment articles it paints a horrifying picture of what is happening in Europe. As if there is no chance for success.
If that were true, then wouldn’t the market be much lower now???
Meaning that right now we are only 2% away from the highs made on October 28th when a debt deal seemed secured and US GDP came in at an impressive +2.5%. So if the big money investors, with supposedly more insight into these matters, were more worried about Europe, then we would be much closer to 1100 on the S&P as we were a month ago.
Yet we are not there. We are a full 15% above that and only 2% away from the highs. That means odds of success in Europe is better than the popular media would lead us to believe. And that is why I have a slight bullish bias in the portfolio (about 50% long). However, I am loath to stick out our necks any further without more concrete proof of success.
So the waiting game continues… |
发表于 2011-11-8 09:01
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