The markets broke out this week to new highs after consolidating since late October. The S&P 500 is now two points away from hitting 1800, the Dow Jones Industrial Average is closing in on 16K, and the NASDAQ close to hitting 4K.
Since the SDR is just an aggregate of fiat currencies, it cannot really change the fundamentals of the current status quo.
Trying to find the rhyme and reason in the markets these days can cause a lot of investors to feel anxious. We continually face negative catalysts in the market — European Sovereign Debt Crisis, Fukushima, Flash Crash, Arab Spring, etc. — yet the market marches higher.
In preparation for my presentations this fall, I’ve been pulling together this kind of research that investors can put to use today. One very contrarian idea these days is investing in resources. This is an unloved and underowned area of the market, but there is a case to be made for owning commodities.
Markets are up over 8% since the October lows and as the market has vaulted higher so too have investor sentiment levels, which will have to be worked off at some point. As seen below, institutional active managers are the most bullish they have been since early 2013 with retail investors the most bullish they have been since early 2012.