By Nicholas Santiago on March 23rd, 2010 12:58pm Eastern Time
Everyday we see the markets continuing to climb. This has been a bull run for the ages since March 2009. During this one year rally the market has not had a single ten percent correction. This move has been impressive to say the least.
Since the February 5th, 2010 pivot pullback low the market has emerged with new leaders. The iShares Russell 2000 Index (NYSE:IWM) was the first index to make a new high in 2010. This index represents small business and is viewed by many as a leading indicator.
Last years lagging and government owned stocks such as American International Group Inc (NYSE:AIG), and Citigroup Inc (NYSE:C) have all rallied higher during the first quarter of 2010. This is also a sign that speculators believe times are getting better. Traders and investors are seeking out the bottom of the barrel names in order to get a return.
Historically the market leaders have been copper and copper stocks. This usually tells traders and investors that there is building and expansion taking place. Currently the only building and growth that is taking place comes from China and parts of Asia. However, since China is starting to tighten their lending requirements for banks, copper has not outperformed. Leading copper stocks such as Freeport-McMoRan Copper & Gold Inc (NYSE:FCX) and Southern Copper Corporation (NYSE:SCCO) are still below their January 2010 highs. This pattern has historically been a negative signal for the markets.
The markets have continued to climb higher and the trend is clearly up. This reminds me of the children game musical chairs. The market continues to move higher everyday. Currently the markets are saying every thing is just fine. However, be careful to not get caught when the music stops.
Nicholas Santiago
Chief Market Strategist
InTheMoneyStocks.com
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