A quick media round up:
Yesterday Morning’s RR&A commentary was picked up by the WSJ — with Jim Bianco and David Rosenberg — that’s some pretty good company. (It also turned out that the advice was pretty good):
As the market starts to digest the Federal Reserve’s post-meeting minutes9 from late June, released a few minutes ago, some analysts are warning of yesterday’s Ben Bernanke-aided rally: be afraid. The post-Bernanke re-think hasn’t amounted to much of a selloff, save for technology stocks, which are ostensibly getting hurt more because of disappointing earnings from chip behemoth Intel.
"To us, this has all the appearances of an oversold bounce. Historically, these huge one day lifts — especially coming after a sharp downward stretch — are not very reliable buy signals," wrote Barry Ritholtz of Ritholtz Capital Markets, in an afternoon comment today. "We know from history that the most vicious rallies take place in bear markets."
James Bianco of Bianco Research said the same thing in commentary today, pointing out that the "incontrovertible evidence is thrice in a three-month period Bernanke has unleashed a violent short-covering rally simply by hinting the Federal Reserve will someday cease and desist in its rate-hike campaign. These rallies have been short-lived affairs."
Mr. Bianco pointed out that on April 26, the day before the first such rally, the S&P 500 was at 1305.41, and today, it is around 1259. The bearish Mr. Ritholtz concurs, saying that the "One and Done crowd may have finally gotten their wish. This Ship of Fools have been behind nearly every failed rally of recent vintage … as history has shown us more often that not, when the Fed finally stops it is because growth has slowed to the point where inflation has been tamed, but at a cost of setting the economy to the point of contraction."
David Rosenberg, chief North American economist at Merrill Lynch, added: "The equity market is too caught up in the ‘pause’ — it’s repeatedly treating it as an ‘ease’."
See also in the media Thursday/Friday:
• U.S. stock futures rise after Microsoft, Google (Reuters)
• Consumer prices fan inflation fears (Atlanta Journal-Constitution.)
• A rocky road lies ahead for U.S. equities (MarketWatch)
• Lookahead: No Satisfaction (WSJ)
David A. Gaffen
WSJ, July 20, 2007, 2:19 p.m.
Consumer prices fan inflation fears
MICHAEL E. KANELL
Atlanta Journal-Constitution, Thursday, July 20, 2006
US stock futures rise after Microsoft, Google
Fri Jul 21, 2006 7:08am ET
A rocky road lies ahead for U.S. equities
MarketWatch, Friday July 21, 7:50 pm ET
Lookahead: No Satisfaction
WSJ, July 21, 2006 9:27 p.m.