From the Slope of Hope: Being an equity bear has been brutal for, oh, nearly eight years now. With the S&P up about 250% since bottoming in March 2009, equities have been, on the whole, raging higher, with some sectors in particular benefiting tremendously from the Trumpgasm. One area, though, seems to be recognizing a bitterly cold chill of reality, and that is retail.
Anyone else get this feeling today...
S&P 2,300; Dow 20,100 early on but couldn't extend gains...
NOTE Dow was closed right at 20100...
With global stock markets basking in the afterglow of Dow crossing 20,000 for the first time, on Thursday they propelled higher in sympathy with the US, as Asia and Europe are trading solidly in the green, as is the dollar which rebounded strongly off a 5 week low. Copper touched the highest price since November after reports of lower production. Global government bonds extended declines as France’s 10-year yield breached 1% for the first time in more than a year. Gold declined.
With the recent performance of the S&P, in which there has not been even a single 1% drawdown since the election, not only is complacency raging but some traders have forgotten what it even means to experience a modest 5% correction, let alone a 20% bear market. How much longer can this go on?
For the answer, we turned to a recent report by InvesTech, according to which as the table below shows, a 5% correction has occurred about once every seven months in an ongoing bull market.
With the Dow set to open above 20,000, here are some words of encouragement from Dennis Gartman:
THE US STOCK MARKET BREAKS OUT TO THE UPSIDE: Risk does indeed happen fast but for now the risk is that stocks may move away to the upside! Those who are short shall panic; those not long shall have to become so… swiftly.