Random Roger, following up on the 300-point rally meme, agrees that during bear markets, there does tend to be more volatility. Remember, volatility doesn’t necessarily equal whatever is happening (or not happening) in the VIX. And more importantly, volatility doesn’t equal large-size selloffs – monster one-day rallies are constitutive of volatility, too!
Adam has had enough of people deriving some major magical causal link between the price of crude and equity rallies. We couldn’t agree more – oil-related stories are always great…
Ok, stupid pun. But the August crude futures contract (CLU8) is down another $2 today (about 1.6%), and the market indexes don’t seem to care that much. While the NDX(QQQQ) and RUT(IWM) are up about 1%, SPX(SPY) and DJIA(DIA) are only modestly higher. A small rally this morning faded pretty quickly, and we wouldn’t be surprised to make a new low for the week into the close.
Among the key sectors we follow, broker/dealers, banks, and biotech are bringing up the…
The inverse relationship between oil prices and equity markets still seems intact: as crude has sold off over the past week, markets have lifted, and some analysts have even tried charting an hour-by-hour mapping of the correlation. While we’re long-term bullish on oil (how could anyone not be?), we don’t anticipate an immediate or intense turn around in crude prices. At the same time, while the price of oil could certainly drift a bit lower, we don’t foresee any catalysts…
Sunday, August 10, 2008
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