Let’s start with the good. The Nasdaq became the first major average to reclaim its 200-day moving average level to close out the week (the small-cap S&P 600 index did so on Thursday). According to the Investor’s Business Daily, new highs outnumbered new lows for just the second time in the past two weeks; and, the market closed near the highs of the day for the second straight session. But … the rally last Friday was on extremely low volume — for the Nasdaq, it was actually the low-water mark of the year. The market is still devoid of follow-throughs on big volume — that is a problem for the bulls.
• Gold may be near-term overbought: we remain long-term bullish on gold, but there is a herd mentality now that is a little disconcerting
• While you were sleeping: global equity markets are up sharply to start off the week and in turn, the safe-haven sphere of government bonds are selling off
• Why the U.S. States are not PIIGS: the comparison of the U.S. State and local government with the nanny states in Europe is unfair
• U.S. consumer sentiment up a tad
• Double-dip, anyone? The latest figure on the smooth ECRI weekly leading index has now turned negative, which is now signaling an 80% chance of a double-dip recession
• No sails in retail sales: U.S. retail sales came in far weaker than expected in May