Jay Powell heads to the Senate today and I hope he gets some better questioning because yesterday’s Q&A was a real snoozer.
Along with the bounce back in stocks, Investors Intelligence saw more Bulls at 52.9% from 47.6% last week and vs 52.8% in the week prior. Bears were little changed at 19.2% vs 19.1% and that actually is the most since last April while most of the Bulls came out of the Correction side which stands at 27.9% vs 33.3% last week. Bottom line, after seeing extreme bull readings in a variety of metrics literally days before the virus outbreak, the pullback in stocks rung some of that optimism out but it’s coming back rather quickly. Buy on the dip remains firmly embedded in the mentality of the investor as we know.
According to the MBA, mortgage applications were mixed as purchases fell for a 2nd week and by 5.8% but the y/o/y gain was still 16% (easy comparison’s though after the aftermath of the tough Q4 of 2018). Refi’s rose 5% as mortgage rates hold at multi year lows and are higher by 207% y/o/y.
MBA PURCHASE APPS

Following a slew of industrial production misses seen over the past week from some European countries, today’s release of the data for the entire region saw a 2.1% m/o/m decline, one tenth more than expected, November was revised down by 2 tenths and the y/o/y decline was 4.1% which matches the worst print since 2009. This figure has declined y/o/y for 14 straight months. And now the global economy has the major disruptions that the virus brings.
The global stock markets are pricing in the rebound likely to come this spring time while global bonds are more worried about the economic here and now. Oil is bouncing back above $50 (the dividend yields that big oil stocks are paying are pretty compelling I believe so let the ESG people sell as much as they want) and copper is higher for a 2nd day.
Reflecting the upside down world of the epic bond bubble we are experiencing, the Greek 10 yr bond yield has broken below 1% at .98%. Now I’ve been a bull on Greek stocks over the past year plus on the positives that President Kyriakos Mitsotakis was expected and is currently bringing to their economy but this move in yields is quite astonishing.
GREEK 10 yr yield
