Wednesday, November 25, 2009
Midday Briefing for November 25th: Cross-Currents
Many cross-currents in the markets lately: yields on 10-year Treasury notes continue to decline (top chart) in the wake of continued Fed ease. That has given the green light for USD selling and strong performances today in the euro and Aussie dollar; it has also supported the commodities, with gold registering yet another fresh high.
All of that is supportive of stock prices, and the ES futures are knocking at the door of their recent bull highs. Still, small cap issues lag and financial stocks (bottom chart) are notably weak. GS, for example, has been making day over day lows with consistency. Today we see fewer than 1000 stocks making fresh 20-day highs across the NYSE, NASDAQ, and ASE thus far. With such a narrow base to stock strength and glaring weakness among banking issues, it's difficult to get too excited about today's strength, in spite of the supportive macro picture.