It’s the economy today…
The stock market rallying has the commodites moving higher and the commodity currencies in demand today. Energy, copper, and other industrial metals are up today which has things looking good. The Wells Fargo earning have people wondering as well. Remember Wells is in California and maybe it does not say it is “happy days” again – they have a lot of million dollar homes with jumbo sized mortgages which are underwater – but the yield curve is certainly benefiting cash flow earnings and can dramatic especially if bank mortgages have all been written off. If homeowners make payments the spread between mortage rates and free money, rings the cash register day to day. It is when payments don’t come in and houses are written off at foreclosure prices. In addition, do not underestimate the Trade Balance today as well. It will add to GDP.
In a related market, the Financial Select Sector SPDR (symbol XLF), has been rebounding and is testing resistance after selling off sharply last month. Banks are not out of the woods as people are still losing jobs and that leads to mortgage defaults, but perhaps stabilization may be upon the US, and the yield curve helps.
Ironically, both Canada and Australia had weaker employment reports today, yet both their currencies are moving higher. The commodity/economy story is trumping the employment picture (much like it is in the banking stocks). The USDCAD is now moving through the low from Monday at the 1.2222 level. The next level is 1.2189 to 1.2200 which represents a series of low going back to March 19th
Loading ...
No Responses to “It’s the economy today…”
Add a comment