Daily Alert – Wednesday 8th September 2021: Institutions sour on US equities

Mark NugentDaily Alert, Sept 2021

Daily Alert – Wednesday 8th September 2021: Institutions sour on US equities

US equities dropped yesterday as the market began to tell itself that the US economic recovery is going to be “somewhat less exuberant than hoped”. The rationale stated is excessive valuations, lockdowns, travel curbs and a general feeling that the world is not ready for the tapering than many central banks are talking about. Morgan Stanley, Citigroup and others are said to be “underweight” in US equities.

This may or may not be real. Sometimes when things are quiet the market can get its knickers in a twist and when the next distraction comes along, all is forgotten. Meanwhile, I will position for a move up.

WTI hit the bottom (support) of its recent range yesterday and is now at the top (resistance). I am watching this closely.

Despite the move downwards in US equities, the US 10-year yield climbed, so risk sentiment was mixed and as such the JPY/commodity currency play remained elusive.

Later today we have the rate decision and statement from the Bank of Canada and the private sector oil inventory report.

I’ll be back tomorrow.

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