We had one of the longest winning streaks in several decades end last week.
That move took the S&P 500 stock-index from below 4200 to above 4400 in just 10 trading days.
We again made the trip down and back up.
This time seems significant as it was accomplished in such a short period of time.
It seems that 4200 is the new 3900 that became a floor for the market.
It is important to establish these levels as they become stepping stones for a move north.
It seems to build confidence in the market traders that we have es-
tablished a floor.
As you saw over the last year, it
takes several attempts to move on.
While this is all great speculation, we are still led by 7 stocks.
That does bother me.
It is much better to have the breadth of more stocks in more sectors.
That may be old news and things are different this time.
I don’t believe it is ever different.
I have been optimistic this last quarter would be good for equities.
I didn’t think it would happen in over two weeks. That leaves plenty of time for more action before the end of the year.
The new favorite on the block are the pharmaceuticals that produce weight-loss drugs.
I was skeptical as the cost has been prohibitive to make only the rich able to purchase these drugs.
I have contended for some time that one of the greatest health risks is not illegal drugs, but the fact that we have the vast portion of the population overweight, which causes a myriad of problems, from diabetes to heart disease.
We seem more concerned about the climate while millions lose their life from heart attack, diabetes and other related diseases.
Not sure I see millions of people forking over $1,000 plus a month to lose weight.
Speaking of climate, there are forecasts for a wetter and colder winter.
That could impact the price of natural gas which could drive up electric rates.
It is not that long ago for us to remember the impact of Uri and the cold snap that brought the Texas economy to a standstill for almost a week.
We came perilously close this summer with record electric use due to high temperatures.
I haven’t seen any significant improvement in the electric grid or generating systems to offset any unusually high electric demand.
Just another pebble in the shoe of the economy to destabilize the situation.
I won’t go into foreign affairs, the debt crisis and higher interest rates.
I am cognizant of such, but I am focused on the fact that the economy is stronger than many expected.
There was all the talk about a recession.
Our focus is short lived as evidenced by a change in temperature and abundant rain.
What drought?
It seems that while there is much to keep our attention toward caution, there is plenty for optimism.