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This Market Rally is for Real and the Big Money" is confirming it


The data is announcing that the institutional side lined money, i.e. Pension managers and Mutual Fund houses have been among the biggest buyers of the DJIA in recent weeks, confirming the growing belief the recession is over. Between July 14 and July 21, when the DJIA gained almost 600 pts to close at 8915, net buying by pension managers and mutual fund managers, the so-called "long-term" or "big" money managers, totaled US$1.9B, according to Thomson Reuters, who analyzed settlement records of the Dow components.The following week, when the DJIA approached 9000, Pensions and Mutual Funds were net sellers but only at US$578M, while hedge funds were net buyers of US$19M in Dow stocks but not after selling US$166M the previous week, the settlement records showed. "There is some momentum lost among pensions and mutual fund investors, but the move is still generally positive," Shacket said on Tuesday. "These buyers are saying that this market is going to go higher, and not lower any time soon." The move by these institutional investors into Dow stocks corroborates with economic data and earnings that have been better than expected.