..all around the world

                                                                   
How time …doesn’t fly!.  

Back in April, …."Our speculation..... Possibly a May sizable correction coinciding with the “Sell and go away in May” almanac trading mentality returning..”  

Only today, some 50+ trading days from a mid May day, we can we say the market finally achieved a close above that May close and above any June close.   The June peak retest is underway.  Is this the significant step to move forward?.   Most importantly, is performance anxiety going to rule and force investors to get their money off the sidelines and into the markets.   Unfortunately,  it won’t be so fast based purely on technicals because of what’s transpired from the European crisis to Flash Crash to Double Dip chatter in the past 3 months that has really left confidence in shambles.    Also, money managers/MF’s are as invested as they’ve ever been and don’t have excess cash to put in the market without new money inflow, instead of the usual outflow redemptions we've seen for months.  Simply, today’s great, but it’s not so clear cut.   

What today’s global market exuberance off Global PMI/ISM’s did was show those left on the double dip camp falling off.    Last week, we highlighted the importance and the market’s wait and see on the Macro picture into Monday‘s trade.   Today’s market gains are a pure reflection of how integral these PMI’s were to add to the micro earnings picture that developed over the past few weeks!.  It was not only the China #’s noted yesterday before trading,  it was followed by a stronger Eurozone, we can even sprinkle in some Australian and Indian PMI figures for taste.   The icing on the cake was the US ISM#!.   This was the big surprise (GS had a terrible expectation) considering all previous ‘regional’ (excl. Chi PMI Friday) were horrendous!.   What happened in the last weeks/ days of July to propel this final number after such a sluggish start?.   Whatever the fuel was,  it was definitely a changed landscape.

Now, the question is if the market can build on today?.   If it wasn’t for the big 7% month in July, we’d say it would be easy retest and break of the June peak, but sentiment is close to peaking on overbought territory due to the big July.   Still, we can go to 1150 in an overbought state.   Recall, recently called a sentiment bottom here and it prevailed in a very timely fashion.   So, taking it one day at time, but the employment ISM part is very encouraging for a good print on NFP# Friday.   After some probable early consolidation following today’s gains, an effort to go higher into NFP is probable, based on this ISM labor prelude.