With the price of crude oil surging more than 3% while stocks and gold take a breather to consolidate recent gains, here is an excellent snapshot of what to look at today.
Bulls & Bears
February 27 (King World News) – Here is the latest from Peter Boockvar as the world awaits the next round of monetary madness: Sentiment got a touch more bullish w/o/w according to Investors Intelligence. Bulls rose for the 8th straight week to 52.4 from 51.9 and that’s the longest streak since right after the presidential election. Bulls fell to a 10 week low to 20.4 from 20.7 while those expecting a Correction remains around a 4 month low. The spread between bulls and bears is the most since mid October…
To listen to Doug Casey’s just-released KWN interview discussing his prediction of financial and economic chaos and a panic into gold CLICK HERE OR BELOW:
Bottom line, while not extreme, sentiment clearly has shifted firmly to the Bull side with it above 50 and Bears at 20.
Meanwhile, the CNN Fear & Greed index is up to 73, just a few pts from entering the ‘Extreme Greed’ category. This was 55 one month ago and touched 2 in late December. Thus, from purely a contrarian perspective, sentiment is not much of a help anymore.
While mortgage rates were little changed w/o/w, mortgage applications did bounce. Purchases rose 6.1% w/o/w and are now up 2.7% y/o/y. Refi’s grew by 5.8% from last week and are now flat with last year (easy comparison).
Pending home sales for January surprised to the upside with a 4.6% m/o/m increase, well above the estimate of up 1%. This follows 6 months in a row of declines and sales y/o/y were still down by 3.2%. Sales in the South did a U turn as they grew by 8.9% after 6 months of declines and that led the rebound. The NAR cited the lower mortgage rate environment and government reopening as helping the tone of contract signings.
The Rush To Take Advantage Of Sudden Drop In Rates
Bottom line to the mortgage data and pending home sales, let’s hope it continues and that this is just more than a rush to take advantage of the sudden drop in rates over the past few months.
If you didn’t see, Toll Brothers released earnings last night and said orders fell 24% in Q1 y/o/y. The CEO said “We attribute the decline in our first quarter contracts to a difficult y/o/y comparison, a lack of current inventory in certain locations and the industry wide slowdown that began in the 2nd half of 2018.” They do remain bullish on the industry in part due to the recent drop in rates.
Robert Lighthizer is on the tape saying “much needs to be done” when and if a deal is done but there is still the unanswered questions of what happens to the existing tariffs. Will they stay on and be used as an enforcement mechanism or taken off and threatened to be put back on if the deal is not adhered to.
KWN has now released one of the greatest audio interviews ever with Bill Fleckenstein and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.
***Also just released: A Stunning “Smart Money” Update In Stocks CLICK HERE TO READ.
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