Daily Investment Interpretations

January 20, 2010

2010-1-20:  The indices fell today approximately as much as they rose yesterday. The reason is political. Yesterday's election of a Republican Senator to replace Democrat Ted Kennedy is being interpreted as a development that will strengthen the dollar, which, in turn, has led to some short-covering of bets against the dollar. And lately, the equity markets have moved down when the dollar has moved up. The NASDAQ Composite lost 29.15 points, (-1.26%) to close at 2,391.25, the Dow backed up 115.78 points (-1.14%) to close at 10,603.15, and the S&P 500 gave up 12.19 points (-1.06%) to 1,138.04. Oil ended the day at $77.62 a barrel. Gold doffed $27 to end at $1,113. The VIX rose 0.33 to 18.68.
    December home sales were disappointing: Builder stocks fall on FHA news, housing starts. Mark Hulbert observes what my advisory service has observed: that the breadth and continuing drift to new highs argues for still-higher highs ahead: New high data suggests new highs ahead. However, the World Bank today offered a sobering prospect for a second leg of a double-dip recession this year: World Bank worried about recovery.