The Third Quarter Arrives: Hold On to Your Hats!
The second half of 2013 is upon us.
The third quarter cometh and not a moment too soon; you could almost hear hair follicles hitting the trading desks last week as fund managers put the final touches on the first half of their year.
While June was a volatile month, 2013 is shaping up just fine, thank you: The Dow Jones Industrial Average (INDEXDJX:.DJI), S&P 500 (INDEXSP:.INX), and Nasdaq (INDEXNASDAQ:.IXIC) are all hovering at or near 13% which isn’t too shabby, all things considered.
We covered a lot of ground last week; on Monday we asked if Shibor Will Become the Modern Day Sub-Prime.
On Tuesday, we offered that China Is Trying to Teach the USA Free-Market Capitalism.
On Wednesday, after the paltry 1.8% GDP, we discussed the difference between a Stock Market Rally and an Economic Recovery, and gave a Pop Quiz: Will the Stock Market Rally Last?
Thursday, we highlighted the technical landscape in The US Stock Market: Highway to the Danger Zone and Friday we asked if Gold Was a Leading Indicator of Equities before offering that Gold could see a $100 rally the before Friday (as I write, gold has traded $68 off the low print).
We began this abbreviated holiday stretch—flush with Q3 agendas, thin skeletal ranks manning trading desks, and all sorts of technical influences—on a positive note after Japan set the global tone (+1.3%) and Chinese equities edged higher (Shanghai lost over 20% in June alone; the bounce, thus far, is all of 7%).
All eyes turn to the United States of America to see if the country will indeed have a happy birthday.
The stateside tape opened higher, testing the 50-day moving average at S&P 1623. Thus far, S&P 1600—past resistance and near-term support—held two tests of that level.
The banks, breadth, gold, and tech should help guide us as we together find our way. Goldman Sachs Group Inc (NYSE:GS), Citigroup Inc. (NYSE:C), JPMorgan Chase & Co. (NYSE:JPM), Deutsche Bank AG (USA) (NYSE:DB) and Barclays PLC (ADR) (NYSE:BCS) remain our primary single-stock tells.
With unregulated over-the-counter derivatives tying the world together—not just still, but now more than ever—we must respect the unexpected. Risk has not disappeared; it has simply changed shape.
- Stocks have rallied, as has gold (+ almost $70 since we sniffed a bounce on Friday; who was it that said to never let an opinion get in the way of making money?). Either way, the updated S&P vs. Gold chart is pasted below for your review.
- We update our views, risk, and insights in real-time each and every session on the Buzz & Banter; click here for a free two-week trial—and thanks!
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Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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