This market has truly become a snoozer - there have only been a few times when I can remember such little intraday volatility day after day (after day, after day). I don't know if the economic data matters much nowadays since everyone is convinced 2011 is smooth sailing ahead so anything bad people can say is either backwards looking or will mean QE3 is assured, and anything good is ... good. Hence, investors are having it both ways right now in the "can't lose" market. With the four month sprint up, many people are now calling for a pullback right after the new year - but with so many people calling for that one wonders if it will be just that easy, especially with the data that is surely to be positive next week. Maybe it will be a few weeks later when earnings season begins - many stocks are now priced for perfection so if perfection is not shown in the earnings period, we could see selloffs - see Nike (NKE) a few weeks ago.
As you know by now the first day of the month is now almost always a winner ... so I'd assume the fund inflows that drive the first day of the month will only accelerate on the first day of the year. Plus China reports its Purchasing Managers Index ahead of the opening on Monday and we have also now construed the Chinese to be perfect. If the data is strong, we say "China is still on track - just booming!" If the data comes in weaker, we say "China is doing an excellent job of cooling down its inflationary conditions!" Once more, a "can't lose" psychology.
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Alessandra Ambrosio Amanda Detmer Emma Stone Raquel Alessi Marisa Coughlan
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