"If you can't beat 'em, join 'em" seems to be the clarion call from many in the markets as traders who should, and do, know better, hold their noses, pluck out their eyes, plug their ears and buy stocks with both hands and feet. As former fund manager Richard Breslow noted this morning, there's something different with this equity rally.
Different indeed...
Via Bloomberg,
US equity futures have hit a new records, helped by surging Asian and European stocks which have all started November on a euphoric note. Surging commodity prices, optimism about tax reform and hope for a new dovish Fed chair all combined to drive global stock markets to record highs on Wednesday, with the MSCI’s world stock index climbing 0.3% to a fresh all time high. Mining stocks lead gains as nickel and other industrial metals soar.
Yesterday's sharp Chinese selloff is now a distant memory after the BTFDers emerged, and this morning U.S. equity futures are once again levitating as the FOMC begins its two-day policy meeting, following an uneventful BOJ announcement on Tuesday morning which left all QE parameters unchanged. Asian stocks traded mixed steady while European shares climb.
With the Nikkei 225 having only suffered one down day (so far) in the whole month of October (a record), The BoJ decided it's better not to rock the boat and left monetary policy unchanged, as expected.
With new members at The BoJ, there was perhaps some uncertainty about Kuroda's decision today...
Boradly speaking Japanese economic data has been supportive but in recent days, disappointment has begun to set in once again...
International equity markets seem to effortlessly surge to brand new record highs with each passing day. As we note fairly frequently, declines have grown shallower over the past two years and the S&P 500 has now gone 246 trading days without trading more than 3% below its record high, the longest streak ever for the index, according to LPL Financial. Meanwhile, the S&P hasn’t had a decline of 10% or more from a recent peak since February 2016.