Tuesday Outlook: Commodities, Emerging Markets

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Someone said to me once that to be short is to cheer bad news. That might be so but then bulls seem to be cheering a lot of bad news lately as well. Each time major firms announce layoffs of thousands of employees [UBS and C for example] bulls cheer and buy those stocks, driving prices higher. So I’d say it’s an even proposition.

Until the Fed decides what it's going to do, markets will stay tense. Clearly, there was a leak indicating perhaps no interest rate cut or a cut and pause. The reaction was a hit to commodity prices and a bump in the dollar. The Fed must have noticed the reaction and would like nothing better than to have that impact. After all interest rates are very low.

I may or may not post tomorrow. Have a pleasant day.

Disclaimer: The ETF Digest maintains a position in IYR, XLB, XLE and MOO.

Comments

[Russ Abbott:]

When you say that FXI had a "nice tradable bounce off $120," that sounds great in hindsight. But where on that bounce was there a signal to get in?

2008 Apr 29 07:26 PM

[swellman:]

There was no signal, and there will never be. The comments as you can see are just that, comments. They are there to entertain folk. Mr. Fry can't predict the future anymore than you can. Enjoy the charts but don't think the people who draw lines on these charts have some secret way of predicting market moves because they don't.

2008 Apr 30 10:27 PM