All Clear

If investors needed proof that the market’s bottom is in, this week provided it. It was the best week of the year in stock market gains and it looks like we have more on the way.

So far, so good

  This week’s behavior in the stock market went according to plan. We broke through several technical supports, reached a fairly critical level, and then bounced back. However, October isn’t over and the probability that we experience more downside remains high. Here’s my take on the week ahead.

Are we there yet?

  No, is the short answer to that headline. The S&P 500 Index needs to test 1,905 or thereabouts before all is said and done. You might ask why.

  Volatility was the buzz word this week in the stock market. The averages moved up and down by a percent or so on a daily basis but ended the week on a high note. Can we expect more of the same?

  The dollars running, stocks are falling, bond prices are jumping while commodities are tanking.  Welcome to another week in the financial markets. Expect more of the same in October.

Waiting on the Fed

It should be clear to you by now that in the United States the Federal Reserve Bank is calling the shots in our financial markets.  To a lesser extent this phenomena is happening all over the world. As such, the markets did little this week because the Fed doesn’t meet again until Tuesday.

  As expected, the European Central Bank announced additional monetary stimulus in its effort to jump-start the EU economies. Global markets liked what they heard and bought stocks to celebrate.

At the beginning of the year Wall Street was certain that interest rates were on their way up. Investors dumped all kinds of bonds anticipating that prices would plummet.  Bond prices did the upset. Go figure.

Labor on their mind

  It is that time of the year again when the world’s central bankers gather together in Wyoming to sort out the economic conditions of the global economy. This year most bankers will be looking at labor growth, or lack thereof, and what to do about it.

Just a few months ago things were looking up in Europe. The economy seemed to be growing modestly, their central bank was talking about further efforts to stimulate the economy and even the PIGS were beginning to recover. And then came Putin.