Daily Investment Interpretations

December 15, 2010

2010-12-15 (Wednesday Night): The markets backed up today. The NASDAQ Composite gained an anemic 10.5 points (-0.4%) to 2,617.22. The Dow fell 19.07 points (-0.17%) to  11,457.47, and the S&P 500 declined 6.36 points (-0.51%) to close at: 1,235.23. Oil fell slightly to $87.81 a barrel, and Gold ended at $1,391. The VIX rose 0.33 to 17.94.
     Moody's rethinking Spain  Moody's is threatening to lower Spain's credit rating.
     Rex Nutting: Housing is the forgotten crisis 
     Bush-tax-cut compromise heads for Senate approval 
     U.S. stocks' recent lofty perch to get even loftier 
     Emerging markets aim for gains in 2011  "Investors poured record amounts into emerging-market funds this year but future stock gains are likely to face pressure in 2011 as central banks raise rates to contain inflation in the world’s fast-growing economies.  ...this year’s performance has been hurt by a slide in China and flat numbers in Brazil, two of the so-called BRICs that have led emerging markets’ growth in recent years. The battle against inflation will likely dominate many emerging markets in 2011 according to analysts.
    "What may help drive growth in emerging markets will be the continuing effects of 'a powerful wave of liquidity” from quantitative easing measures by the U.S. Federal Reserve, and potentially by the Bank of England and Bank of Japan,' said Philip Poole, global head of macro and investment strategy at HSBC Global Asset Management. But the key driver for risk assets next year, he cautioned in a note to clients, 'is likely to be what eventually wins out – this wall of liquidity or the continuing risk that global recovery hits the wall.'
    "Looking at all funds with exposure to different countries, China so far this year has logged the largest amount of net inflows in dollar terms, with its recent take coming in at $13.4 billion. Korea has had $7.7 billion, and Brazil has had $9.2 billion. In spite of the risks of central banks turning off the taps, emerging markets are increasingly perceived as a stable asset class 'that investors need to have exposure to,' said Durham. 'Especially in an environment where you’ve got such low bond yields and disappointing equity returns in developed markets.
     Class chasm  This talks about the way billionaires have recovered from The Great Recession, whereas the rank-and-file have not.
     Hugh Johnson: Bull has legs for 2011 (audio)