DJ> DAX ~6600 ?
thanks for posting your positions / PEG's, Dude. One of the measures that Gersh and I like to follow is the money flows into and out of StockFunds, BondFunds and MoneyMarket. This week-end, Barron's reports...
"...snapshot of sidelined cash shows a major seasonal outflow from MoneyMarket Funds. A hefty $26 billion rolled out of money funds in the week ended Wednesday ... as the public wrote cheques to pay tax bills ... last year, $35 billion ran out of MoneyMarket Funds in the two weeks following the 15-April tax filing date...
"...the seemingly liquidity-induced tax-time market weakness appears to be an annual - and fleeting - phenomenon. In the past five years, the major stock indices have lost 2%-3% on average in the 10 days before tax day, bottoming on the day before (sounds familiar). A rather sharp rally has then tended to ensue over the following 10 days."
BONDS
Higher-rated, taxable BondFunds now have APR yields around 7.2%~7.4% and the best performers QTR-1 were those concentrated in TYX government bonds: corporate bonds continue to languish; political uncertainty has induced uncommon volatility in "Agency" (eg., FannieMae) bonds; and, there were large in-flows of kapital to tax-free, "Municipal" bonds right at the end of QTR-1, which were as quickly taken out again the first two weeks of April. Bond traders expect EuroLand kapital to continue to be supportive of USD denominated government bonds, which also serve as a hedge against the decaying euro. Newer, "inflation indexed" government bonds have attracted some retail volume.
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CrudeOil prices, which declined sharply from a ~$30/bbl peak have bounced but, most folks are expecting a trading range. Executives here in Houston talk about the underlying rig count trend being positive, and expect the OSX.X sector's earnings growth to continue.
Documentaries recently aired in TheStates have revealed that 2/3 of U.S. energy is produced by coal, which may become a political issue. There is some talk about reviving at least our research programmes for nuclear energy: hydro-power is out; wind & bio-mass would require greater surface area than we now allocate to farming; solar can only supplement; hydrogen as fuel is a problem because we have no cost-effective, carbon-free sources for H raw material.
Politically, Gore is seen as "progressive" on energy & environment but he would have to make a deal with the industry to actually implement a progressive agenda. Bush is already aligned with BigOil, but he has shown exceptionally poor judgement, and a somewhat surprising lack of leadership here in Texas: Houston is now America's most (air) polluted city.
There was a state-wide plan for improved auto & industrial air quality, with funds allocated. As soon as a few Bubba's started grumbling about having their pickup trucks inspected, Bush suddenly cancelled the programme in the same month that it was to have begun. The environmental companies who were under contract sued the State: Bush ended up paying the companies for the cost of the aborted programme, though the programme itself was never implemented.
To pay the liability + damages, Bush raided the State's environmental fund, which has all but ceased to function. Houston remains more foul than L.A., and now there is no money for any environmental programme. Texans will overwhelmingly support Bush come November; there is considerable anti-Clinton/Gore sentiment nationwide, too. We're not optimistic about U.S. energy and environmental progress, even if Gore beats Bush.
Industrial metals prices (in USD) for Al and Cu are declining: primary capacity utilisation increased during QTR-1; the CIS continues to dump aluminium (for hard currency) on the EU. In the aluminium biz, growth is most evident in the Primary Foundry Alloys area, which serves the automotive sector. Margins for PFA's now exceed those for bellwether 6063 alloy billet aluminium - metal used for architectural extrusions. Scrap (a huge U.S. export) prices paid for aluminium are going down; many U.S. municipalities are now abandoning their taxpayer-subsidized programmes for recycling paper, glass and plastics. Most of the recyclers who used to handle these scraps, before the States and local governments took them over - went out of business; those few that remain refuse to buy these scraps and demand to be paid to take them. Municipalities are reviving land-fill programmes as a consequence.
Apparently the Alcan-Alusuisse-Pechiney merger was upset by pressure from VIAG-VAW: Alcan & VAW each own a 50% interest in that monstrous "Norf" plant in Germany. The EU's gotta do something, though, because AA - Alcoa has a superb management, as well as secure sources for bauxite/alumina raw materials. From what I can tell, Alcoa will take advantage of their exceptionally low costs & management efficiencies, ramp up their primary production pot-lines, dump Al on the world market - and the EU metal market gets crushed between Alcoa on one side and the CIS on the other. It's a lousy time to be "green" :-/
-Steve |
