What was looking like the possibility of a ‘risk on’ day has turned into a big nothing done. Even a better than expected University of Michigan Consumer Confidence number could not garner any kind of thrust to the upside. The headlines out of Europe continue to be bi-polar and problematic. Much was made of headlines out of Technocrat Mario Monti who said the German Chancellor was boxed in on Eurobonds. Today the Dutch confirmed they are also against the idea of Eurobonds until countries get their respective fiscal houses in order. So it sounds like Mr. Monti may find himself boxed in instead. German Consumer Confidence was a touch better, again no real reaction. Headlines out of Spain were garnering most of the attention. Unfortunately for the beleaguered Euro , Spain is a much bigger problem then the Greeks. The common currency briefly touched levels not seen since August 2010. King Copper continued its bearish streak down for a fifth consecutive week. It’s longest losing streak since May 2010. The parallels to the summer of 2010 are becoming all too common. U.S markets will be closed for the Memorial Day holiday on Monday. The rest of the globe will be open for business. Sunday night will see the release of China ’s Leading Index. The prior reading was 100.52. Can anyone say reserve cut in Cantonese? A heavy dose of data will come out of Japan on Monday, including Jobless data and Retail Sales. U.S. traders will head back to work on Tuesday and the docket will be full. German CPI, Case-Shiller, Consumer Confidence and Dallas Fed Manufacturing will all be released. Can we break the current trend of negative Friday’s as the whole month of May has seen a red candle to end the week? As ‘risk off’ and Friday’s have become synonymous. Currently the market looks like it will be content to take its ~2% rally on the week and head to the boardwalk! Obviously liquidity may dry up as we head into the close and outsized moves could be made on very little volume. Have a wonderful holiday weekend. Remember the real meaning of the holiday and thank those who have so valiantly served so that we may remain free. Ancient Greek historian Thucydides rapped it up nicely; “The secret of happiness is Freedom, and the secret of Freedom, Courage.” Enjoy.
Eric J. Schumacher
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