I am glad I didn't post this earlier, as I don't need to get anyone bullish at the beginning of a day like today, but do be aware that Brazil CUT rates yesterday. One of the big questions this year would be the potential of the BRICs to step on the brakes too hard. Emerging Markets rallied on the back of this yesterday and are down just a little today. I am no expert on this one, but it might make sense to invest in Brazilian debt here - there are funds that do so (or emerging markets in general). The rates are high and the finances stronger than in the U.S. (seemingly little currency risk in the long-run).
I wouldn't be too discouraged by the action today (I would say I expected it). While we still have a potential gap to fill, it doesn't have to get filled (though odds are that it does). I think that it's possible we go to 125.50 or so first. While I pay attention to the S&P 500 as being more representative than the widely watched Dow 30, it closed up YTD yesterday (barely). Now it's down a little but up including dividends I think. In any event, I continue to think that we have a shot at the Hail Mary getting caught (rally to 125.50 and then keep rallying), though the more likely scenario is a test (114-117). Of course, if it follows 1998, we will make new lows in Sep/Oct, but not by too much. For now, the 2008 style sell-off seems the least likely still.
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