Trader Talk
- Stocks Lurking Near New Highs Again
- Risk Trade Is Back On
- This Week's Biggest Story: The Dollar
- Corporate Issuance Continues at Torrid Pace
- The Bernanke Dollar Bounce & Gross Says Forget About Rate Hike
- Colgate Really Sparkles After Hours
- Light Volume Has Traders Complaining
- Gold Shatters Another Record
- Have Retailers Reached Their Limits?
- The Retail Mind Game
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Reporter
If you are confused by the action today, you shouldn't be. Biggest question is, why aren't stocks up more because the non-farm payroll data was better than expected?
The data was indeed good news (ignore all the noise about whether or not the stats are accurate; this is an eternal gripe among traders).
But the information on an improving economy puts pressure on various parts of the market, all of which is normal.
Here's how it works:
1) Better economic data helps the dollar.
2) But the stronger dollar puts pressure on commodities and some stocks.
3) Treasuries: traders are now seeking higher yields as they begin to price in earlier rate hikes than expected.
Peter Boockvar and others have noted that the fed funds futures is now pricing in a 48 percent chance of a quarter point rate hike by the September meeting; up from a 2% chance just yesterday.
4) The flattening yield curve may hurt banks
The battle lines are simple: does consumer have sufficient buying power to lift economy in next 6 months?
Bears:
No--markets will drop in Sept-Oct.
Bulls:
Yes--not roaring recovery, but sufficient
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POPULAR TRADER TALK POSTS
- Stocks Lurking Near New Highs Again
- Risk Trade Is Back On
- This Week's Biggest Story: The Dollar
- Corporate Issuance Continues at Torrid Pace
- The Bernanke Dollar Bounce & Gross Says Forget About Rate Hike
- Colgate Really Sparkles After Hours
- Light Volume Has Traders Complaining
- Gold Shatters Another Record
- Have Retailers Reached Their Limits?
- The Retail Mind Game








