Asia was 1% to 2% higher and Europe rallied a couple of percent, as Glencore bounced another 12%. Whether that was a catalyst for Europe I don’t know, but there was quite a party thrown around the globe on the last day of the quarter, and the SPOOs were not about to sit on the sidelines. Thus, our market erupted and managed to tack on 1.5% in about 90 minutes this morning, with the Nasdaq 2% higher and lots of stocks leaping for more than the averages indicated. All the bulls are going to say that this was a successful test of the lows, which I think won’t turn out to be accurate, but we won’t know for sure until the rally fails and the lows are taken out (at which time we could see quite a panic).
Shop Till You Drop
If we have entered a bear market, which I believe we have, we will see rallies that look better than bull-market ones. For example, Fred Hickey pointed out this morning that seven years ago, on September 30, 2008, the Dow rallied 485 points, and then proceeded to plunge 27% in the next eight days.
I’m not sure we’ll get anything quite that ferocious, but we could. The point being, there is a tremendous amount of damage that has been done to the market beneath the surface, and despite what the mainstream media and Bubblevision think, the market is in a great deal of trouble.
Turning back to the action, despite a midday dip the market closed on the highs with a gain of about 2%. It appears that the quarter-end markup that we often see came a day later this time. Now we need to see how long the rally can hold together. Away from stocks, green paper was higher, as it followed the stock market, oil was flattish, though copper exploded for about 4%, fixed income was weaker, though not dramatically so, and the metals lost 1%, plus or minus. The miners acted better today in the face of gold’s decline, after behaving poorly in the last couple of days when gold was not too weak, as the bottoming process continues.
Wall Street Sets Up First Booth for Nonfarmers’ Market
By way of a heads-up, Friday will see the release of the nonfarm payroll report. Given the state of the market, there could be a great deal of volatility, though the last couple of reports have not produced that. On the other hand, I will be traveling, so maybe that will coincide with more volatility, as it so often does.
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