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Need to Know
MAY 20, 2013
5 gut checks before the stock
market's opening bell
By Shawn Langlois
Good
morning.
Yahoo shelling out more than $1 billion for Tumblr, with its cat beards and toothless
actresses , isn't doing much to throw water on the
increasingly popular notion that the market's bubbly melt-up mode is only
in the beginning stages.
Ed Yardeni says that Ben Bernanke's commencement speech over
the weekend is "reminiscent of his predecessor's cheerleading of the
1990s bull market" and could lead to a melt-up from these levels .
We seem to be in one of those rare situations -- both scary and wonderful
at the same time -- where no news is bad news. Any sort of grim
economic readings will only give the Federal Reserve more reason to keep
the cash flowing, while any good news, well, is still good news. "God
forbid things do improve, watch out above," Upside Trader wrote in his
"Throw out your playbook" blog post
.
"The bulls want to be so much 'more long' than they are, but they are
waiting for a pullback to take meaningful long positions." he said.
"A non meaningful pullback leaves them no choice but to chase prices
higher."
Key market gauges: With short sellers flocking in
numbers not seen since way back in 2006, gold is looking at its
eighth straight losing session, off more than 1% early. This would mark the
longest such streak since 2009. And silver isn't all that healthy,
either. Read: Metal stocks .
In Asia, stocks kicked off the week in the green, with the Hang Seng
leading the way, up 1.8% to 23,493. Not bad, but there's a long way
to go before the Hong Kong index hits 50,000, as
Morgan Stanley predicts . The Nikkei rose 1.5% to close
above the Dow for the first time in more than three years .
South Korea stocks sat out the fun. Read: Asia Markets .
Europe is playing along, with most indexes up in morning action.
Italy's FTSE MIB is one exception. Futures on the Dow and
S&P are just flailing around the flat line .
The buzz: Along with Yahoo, gold and silver
are jockeying for the top spot on the StockTwits trending list as
investors mull their respective swoons. Our call of the day might be able
to help out on that front. Qihoo , Caesars and Elan are also on
the radar this morning.
Boeing is a hot topic on Google with its Dreamliner 787 getting back in the air in the U.S.
after being grounded at the beginning of the year for battery problems. The
stock is up 1% premarket. Now it's time to focus on other issues .
On Market IQ, Solar City is drawing clicks after the stock surged 26%
Friday. Shares are up more than 2% in premarket action, as well. Here's one
guy who says a Goldman Sachs financing deal gives the
stock plenty of more upside from here. Not a bad year for Tesla's Elon
Musk, who chairs the company.
The chart of the day: Traders are diving into the dollar
these days, with cumulative positioning hovering above $30 billion for only
the fifth week in the past 15 years, according to the Short Side of Long blog . All the
other times took place in June 2012, when the euro crisis was in full
bloom. At the same time, the blogger pointed out that traders are short
every single major currency in the G-10, except for the Kiwi dollar.
The
call of the day: Are you holding out for
that inevitable snap back in precious metal prices? Grab a hard hat because
The Fly from the iBankCoin blog isn't mincing
words: "If you're still in gold/silver, you deserve to lose
money." He warned investors of the "Great Big Silver Run of
2013" and said the "generational top" has been in for
months. "You're just too god damned stupid to realize it" and you
continue to buy into a thesis that is "supported by hunched backed
creatures, who live in different realms, think about the world in different
terms." So, you DON'T like gold right now?
Cam Hui, of the Humble Student of the Markets blog ,
sees it all together differently, suggesting there's some upside from here as commodities
stabilize.
Random reads: Economists are not equipped to to be stockpickers,
says economist.
Now that we know the next installment of the Star Wars series will be
filmed in the U.K., here are the kinds of things we can expect to see .
In that listy spirit, let's go back to Tumblr, which could turn out to be a "far more expensive mistake"
than Flickr. Useful -- 10 blogs "that make travel more interesting."
Not useful -- "Kim
Jong-Il looking at things ."
Take a glimpse at the Tumblr guy's life.
And speaking of North Korea, it's back in "attention-seeking toddler" mode
.
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