By Gareth Soloway on October 25th, 2010 11:40am Eastern Time
The big G20 meeting was held this weekend. If anyone expected a consensus on currencies they were sadly mistaken. Following the meeting, the Dollar continued its rapid decent lower. The move lower today, move lower, jumped the markets sharply higher. The SPDR S&P 500 ETF (NYSE:SPY) is trading at $119.02, +0.67 (+0.57%).
It is likely the markets will be held neutral to higher into the elections next week. While many want to deny any sort of connection between politics and the manipulation in the markets, it becomes clearer every day. The Federal Reserve wants a weak Dollar as do the Democrats. If the President is going to keep control of both the Senate and the House, he needs all the help he can get. Keeping the markets strong will make people think the economy is improving into the elections. This is the only chance the Democrats have. After the elections, if the Republicans take over, the markets can pull back as the public will push blame on them. In addition, if the Democrats hold power, the next elections are not for some time.
Technology and commodities are leading the market today. Apple Inc. (NASDAQ:AAPL) is inching higher while Amazon.com, Inc. (NASDAQ:AMZN) and Google Inc. (NASDAQ:GOOG) are both higher as well. Chevron Corporation (NYSE:CVX) is also sharply higher, trading at $85.17, +0.62 (+0.73%).
The one and only weak sector today is again financial stocks. Goldman Sachs Group, Inc. (NYSE:GS) and JPMorgan Chase & Co. (NYSE:JPM) are both lower on the day. To gain more insight, analysis, guidance and education, join the Research Center.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
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Published: Saturday, 23 Oct 2010 | 7:20 AM ET Text Size
By: Reuters
German Economy Minister Rainer Bruederle on Saturday took issue with what he called a U.S. policy of increasing liquidity, saying it indirectly manipulated exchange rates.
http://www.cnbc.com/id/39808247Read more…
Posted by Nin-Hai Tseng, reporter
October 18, 2010 10:35 am
Currency volatility is certainly a problem, but no one's quite sure if we'll know when it becomes a full-blown war. Tensions are escalating among some of the world's biggest economies as finance ministers find incentives to devalue their currencies. But are we in a currency war, or merely a currency spat?
http://finance.fortune.cnn.com/2010/10/18/what-exactly-is-a-currency-war/Read more…
On the interplay between the FED and STOCKS: Since Sept 1 – when QE was becoming a mainstream focus – if you only owned S&P on days when the Fed conducted Open Market Operations (in US Treasuries), your cumulative return is over 11%. in addition, 6 of the 7 times when S&P rallied 1% or more, OMO was conducted that day. this compares to a YTD return of 5.8%. the point: you would have outperformed the market 2x by being long on just the 16 days when – this is the important part – you knew in advance that OMO was to be conducted. The market's performance on the 19 non-OMO days: +70bps.
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By Luciana Lopez and Yoo Choonsik
GYEONGJU, South Korea | Sat Oct 23, 2010 4:05am EDT
(Reuters) - Group of 20 finance leaders struck a landmark deal on Saturday to boost developing countries' power in the International Monetary Fund even as they failed to set targets for a wide-ranging global economic rebalancing.
http://www.reuters.com/article/idUSTRE69K0Q720101023Read more…
