Another round of overnight selling was met with good buying on Thursday. The Durable Goods orders were not as weak as expected and that combined with supportive comments by the Fed’s
Janet Yellen put the bulls in charge.
The S&P 500 had a new all-time closing high but it may take a close above Monday’s high at 1858.71 to worry those who remain on the short side. The nervous bulls are now focused on the recent decline in rates, which suggests that the bond market is not convinced that the recent soft economic data is weather related as yields on the 10-year T-note continue to decline.
Crude oil has rallied impressively over the past seven weeks as the May contract hit a low of $91.39 in the middle of January and hit a high this week of $102.68. As I have been noting for the past month, the higher crude prices have not given the energy stocks much of a boost yet. Global inflation rates are also still quite low but I think stock investors should welcome a gradual increase in inflation.
Gold prices have been quite strong this year as the SPDR Gold Trust (GLD) is up about 10% in 2014 compared to just a 0.5% gain in the Spyder Trust (SPY). With crude and gold both strong, should investors be looking at the resource-heavy Australian and Canadian stock markets?
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