Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
UK Covd-19 FREE Lateral Flow Self Testing Kits How Use for the First Time at Home - 10th Apr 21
NVIDIA Stock ARMED and Dangeorus! - 10th Apr 21
The History of Bitcoin Hard Forks - 10th Apr 21
Gold Mining Stocks: A House Built on Shaky Ground - 9th Apr 21
Stock Market On the Verge of a Pullback - 9th Apr 21
What Is Bitcoin Unlimited? - 9th Apr 21
Most Money Managers Gamble With Your Money - 9th Apr 21
Top 5 Evolving Trends For Mobile Casinos - 9th Apr 21
Top 5 AI Tech Stocks Investing 2021 Analysis - 8th Apr 21
Dow Stock Market Trend Forecast 2021 - Crash or Continuing Bull Run? - 8th Apr 21
Don’t Be Fooled by the Stock Market Rally - 8th Apr 21
Gold and Latin: Twin Pillars of Western Rejuvenation - 8th Apr 21
Stronger US Dollar Reacts To Global Market Concerns – Which ETFs Will Benefit? Part II - 8th Apr 21
You're invited: Spot the Next BIG Move in Oil, Gas, Energy ETFs - 8th Apr 21
Ladies and Gentlemen, Mr US Dollar is Back - 8th Apr 21
Stock Market New S&P 500 Highs or Metals Rising? - 8th Apr 21
Microsoft AI Azure Cloud Computing Driving Tech Giant Profits - 7th Apr 21
Amazon Tech Stock PRIMEDAY SALE- 7th Apr 21
The US has Metals Problem - Lithium, Graphite, Copper, Nickel Supplies - 7th Apr 21
Yes, the Fed Will Cover Biden’s $4 Trillion Deficit - 7th Apr 21
S&P 500 Fireworks and Gold Going Stronger - 7th Apr 21
Stock Market Perceived Vs. Actual Risks: The Key To Success - 7th Apr 21
Investing in Google Deep Mind AI 2021 (Alphabet) - 6th Apr 21
Which ETFs Will Benefit As A Stronger US Dollar Reacts To Global Market Concerns - 6th Apr 21
Staying Out of the Red: Financial Tips for Kent Homeowners - 6th Apr 21
Stock Market Pushing Higher - 6th Apr 21
Inflation Fears Rise on Biden’s $3.9 TRILLION in Deficit Spending - 6th Apr 21
Editing and Rendering Videos Whilst Background Crypto Mining Bitcoins with NiceHash, Davinci Resolve - 5th Apr 21
Why the Financial Gurus Are WRONG About Gold - 5th Apr 21
Will Biden’s Infrastructure Plan Rebuild Gold? - 5th Apr 21
Stocks All Time Highs and Gold Double Bottom - 5th Apr 21
All Tech Stocks Revolve Around This Disruptor - 5th Apr 21
Silver $100 Price Ahead - 4th Apr 21
Is Astra Zeneca Vaccine Safe? Risk of Blood Clots and What Side Effects During 8 Days After Jab - 4th Apr 21
Are Premium Bonds A Good Investment in 2021 vs Savings, AI Stocks and Housing Alternatives - 4th Apr 21
Penny Stocks Hit $2 Trillion - The Real Story Behind This "Road to Riches" Scheme - 4th Apr 21
Should Stock Markets Fear Inflation or Deflation? - 4th Apr 21
Dow Stock Market Trend Forecast 2021 - 3rd Apr 21
Gold Price Just Can’t Seem to Breakout - 3rd Apr 21
Stocks, Gold and the Troubling Yields - 3rd Apr 21
What can you buy with cryptocurrencies?- 3rd Apr 21
What a Long and Not so Strange Trip it’s Been for the Gold Mining Stocks - 2nd Apr 21
WD My Book DUO 28tb Unboxing - What Drives Inside the Enclosure, Reds or Blues Review - 2nd Apr 21
Markets, Mayhem and Elliott Waves - 2nd Apr 21
Gold And US Dollar Hegemony - 2nd Apr 21
What Biden’s Big Infrastructure Push Means for Silver Price - 2nd Apr 21
Stock Market Support Near $14,358 On Transportation Index Suggests Rally Will Continue - 2nd Apr 21
Crypto Mine Bitcoin With Your Gaming PC - How Much Profit after 3 Weeks with NiceHash, RTX 3080 GPU - 2nd Apr 21
UK Lockdowns Ending As Europe Continues to Die, Sweet Child O' Mine 2021 Post Pandemic Hope - 2nd Apr 21
A Climbing USDX Means Gold Investors Should Care - 1st Apr 21
How To Spot Market Boom and Bust Cycles - 1st Apr 21
What Could Slay the Stock & Gold Bulls - 1st Apr 21
Precious Metals Mining Stocks Setting Up For A Breakout Rally – Wait For Confirmation - 1st Apr 21
Fed: “We’re Not Going to Take This Punchbowl Away” - 1st Apr 21
Mining Bitcoin On My Desktop PC For 3 Weeks - How Much Crypto Profit Using RTX 3080 on NiceHash - 31st Mar 21
INFLATION - Wage Slaves vs Gold Owners - 31st Mar 21
Why It‘s Reasonable to Be Bullish Stocks and Gold - 31st Mar 21
How To Be Eligible For An E-Transfer Payday Loan? - 31st Mar 21
eXcentral Review – Trade CFDs with a Customer-Centric Broker - 31st Mar 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Dow Jones Three Up Days In A Row!

Stock-Markets / US Stock Markets Nov 26, 2008 - 02:10 PM GMT

By: PaddyPowerTrader

Stock-Markets After the helter skelter of the previous two days of headline-grabbing gains, the stocks markets went about their business in a more sedate manner yesterday. They still finished above water , extending their winning streak to three. Equities were buoyed by Hank and Ben's latest trick, direct intervention into the frozen mortgage markets.

Home Building stocks were the main beneficiaries on the day, this despite another drop in the Case-Shiller home price index. The big loser was the U.S. Dollar as foreign exchange markets aren't too keen on printing presses working overtime i.e. the twin deficits could be heading for a scary 12% of GDP. If gold goes through $850 it will indicate people are losing faith in the Greenback again.

Today's Market Moving Stories

  • Not sure what the collective noun for central bankers is. Yes, I know what it rhymes with. A plethora of ECB council members have been on the wires warming us up for next weeks third cut in this cycle from the ECB. Austrian and Italian members Nowotny and Bini Smagi and the reformed German hawks Axel Weber and Jurgen Stark have all strongly implied in their coded way that another ½% cut is a done deal on Thursday 4th December. Sure, the market wants and needs more but if you are Irish, Santa is a tracker mortgage.
  • German import prices fell a stunning 3.6% month-on-month (MOM). We get German Lander CPI data later this morning with a dramatic drop of –0.5 MOM possible. This should soften the cough of any remaining hawks in the ECB.
  • Bond markets don't believe in this equity rally. There are now 12 million US households with negative equity. Housing still sucks and prices are still in freefall. Meanwhile, we learn that more banks are getting into trouble . And recall a lot of the failures we've had to date are institutions that weren't even of the watch list!
  • Incoming President Obama is set to complete his line up of former heavyweights of a bygone era with the appointment of legendary inflation fighter Paul Volker to head a new economic advisory board.
  • It's not just the retailers on Main St. that are feeling the pinch. Stats overnight from Mastercard show a dramatic falloff in e-commerce spending so far in November, which was down 4% YOY. To put this in context, just six months ago this was growing at 15%. Ebay and Amazon might be in trouble today on the back of this first ever decline in e-commerce sales.
  • The WSJ writes that the record plunge in commercial real estate securities has seen Parkcentral Global Hub, a $1.5bn fund, confirming it has been forced to liquidate to pay creditors. The FT is reporting that four hedge funds face collapse because they cannot access shares and loans held at the London arm of the defunct Lehman Brothers.
  • The UK government is becoming browned off with the banks and may force them to open theirs books to the authorities if they fail to abide by a code of practise to increase their lending. What was once so easy now appears impossible!
  • Toyota had their credit rating docked two notches by Fitch from AAA to AA.
  • Chinalco says it plans to raise its stake in Rio Tinto to at least 14.99% after the marriage of miners with BHP Billiton ended in acrimony.
  • China has just cut lending and deposit rates by a sizable 1.08% (108 basis points). I know, don't ask.

So What Are The Fed And Treasury Hoping To Achieve
The Fed is seeking to reduce the spreads on the value of Freddie and Fannie securities i.e. their cost of raising new funds (which are unusually high at the moment) which should in theory translate into lower mortgage rates for them to pass on. Indeed these onerous spreads tightened by ½% so the move should bring some tangible real economy benefits . The rally in US Treasury bonds should also help some people to refinance .

The Fed has slashed official interest rates and longer term rates on 10 and 30 year U.S. government bond are near record lows. But still, mortgage rates in many instances have actually risen! This is the idea that monetary policy is like pushing on a string. This echoes what I was talking about yesterday with the dramatic rise in the cost of borrowing for even corporates with good credit ratings .

Data Today
We have a very full data calendar in the day ahead to navigate. Firstly in the UK, the preliminary Q3 GDP report will be the main focus.

In the US, highlights include October's durable goods (consensus: -3.0%, -1.6% ex transport) and the Oct PCE numbers. There is downside risk to Chicago PMI (cons: 37.0) and the final University of Michigan Confidence (cons: 57.5).

It will not be unreasonable to expect more wild and whippy ranges ahead of the impending Thanksgiving holiday which will see US markets wind down at around 5pm today.

The American History Museum Reopens

Disclosures = None

By The Mole

The Mole is a man in the know. I don’t trade for a living, but instead work for a well-known Irish institution, heading a desk that regularly trades over €100 million a day. I aim to provide top quality, up-to-date and relevant market news and data, so that traders can make more informed decisions”.

© 2008 Copyright PaddyPowerTrader - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

PaddyPowerTrader Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules