Global equity markets were mostly higher overnight with Russian stocks and the Australian market trading lower. The US market was waffling around both sides of unchanged due to hints from financial market talking heads, regarding the prospect of a problem for sticks developing from soaring interest rates. In other words, if yield reaches a level where money begins to aggressively rotate out of stocks to interest paying instruments, it could rob the market of significant buying fuel. Furthermore, with many individual issues and index measures within striking distance of record highs, we have to think that the threat of rotation is extremely high. On the other hand, the market is hopeful of tax cuts, infrastructure spending, and reduced regulation. We think that the path of least resistance is pointing upward, but we also think that the knee-jerk reaction has largely run its course and the market might be buffeted by Trump cabinet news or by revived political snipping on each new appointee. As mentioned already, the bulls have to fret over the prospect of rotation away from stocks toward interest paying instruments. December E mini S&P support comes in at the 214850 to 214775 range. The higher high for the move was rejected at 2175 overnight and that hints at a near term top.
Series 3 Licensed
Senior Market Strategist
Jeff studied finance at the University of Wisconsin-Madison and at Loyola University. He left the corporate world in 1995 to pursue his dream of working in the financial markets. Jeff's trading career began as a clerk in the S&P 500 pit at the Chicago Mercantile Exchange. This is where he developed a great interest in the options market that led him to the retail futures business. Jeff spent a few years as a broker's assistant before managing clients of his own.