Morning Note: Unamused European Central Bank

Asian equities closed mostly in the green (12 of the 16 markets we track) overnight, Europe’s trading mostly higher this morning as well (14 of 19), and the U.S. averages are somewhat mixed as the session gets underway: Dow up 209 points (0.75%), S&P 500 up 0.58%, Nasdaq down -0.13%, Russell 2000 flat +0.04%.

The VIX (SP500 implied volatility) is off a titch, -0.11%, while VXN (Nasdaq vol) continues to reflect heightened risk in the tech sector, up 6.37%.

Oil futures are down 2.10%, gold’s down 1.43%, silver’s down 2.33%, copper futures are down 0.45% and the ag complex (in the aggregate) is down 0.61%.

The 10-yr treasury is up on the morning (yield down), and the dollar is catching a very nice bid (hence the drubbing in commodities), up 0.53%.

Despite commodities taking a beating this morning, our core portfolio is up 0.21% as I type. The 11 positions presently in the green are being led by utilities, Verizon, consumer staples, financials and Eurozone equities. The biggest losers being silver, gold, base metals, emerging market equities and ag commodities.

I’ve made mention herein of what I view as the notably oversold state of the dollar, and overbought state of the Euro. A technical correcting (helped along by a European Central Bank who’s no doubt unamused by the Euro’s strength) of this situation would of course have the dollar rallying and the Euro tanking, which is precisely what’s playing out this morning. More on that in the forthcoming “This Week’s Message.”

Have a great day!


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