[Chart courtesy of MarketWatch.com]
- Moving the Markets
Friday’s strong rebound continued today although at a lesser pace. Nevertheless, the major indexes rose in unison as Wall Street traders kept the prospect for the tax cuts and corporate earnings in focus. Despite political upheaval in Germany, caused by Chancellor Merkel not being able to form a coalition government, equities on both sides of the Atlantic were not affected.
Our ETF portfolios performed better than the major averages thanks to nice advances in Semiconductors (SMH +1.21%), Aerospace & Defense (ITA +0.83%) and US SmallCaps (SCHA +0.61%). The gains were solid across the board with no red numbers in sight.
Interest rates rose with the yield on the 10-year bond adding 2 basis points to end the session at 2.37%. Last week’s volatility in the High Yield sector slowed down with HYG losing a tiny -0.04%. Oil dropped and gold got hammered early on as someone decided to dump a huge amount of futures contracts in an obvious attempt to stop gold from reclaiming its $1,300 level. The drop was almost $20, which caused a break below the 50- and 100-day M/As.
With the Euro plunging, thanks to uncertainty in Germany, the US Dollar (UUP) benefited and rallied +0.49% to stay above its 50-day M/A.