Daily Commentary: Sell in May and Go Away

The old adage is to sell in May and buy back in November. Whether this adage holds up is another story. But, with the Fed and the ECB showing the limits of monetary stimulus, markets have stopped their upward path. I think there are good fundamental reasons behind this given the lower earnings growth we have seen. Early this year, I said that Europe would outperform purely because of valuation and if you look at the Dax vs. The S&P, that is certainly the case so far. I continue to believe that US share prices are based on a benign if not an optimistic view of the macro environment. If we see anything less, I believe US shares will be the ones to pull back most.

Jobs data tomorrow: expecting a +250K print. The market will be disappointed with less.

As I am on a mini holiday, that’s it. Here are the links.

  • Blacks, Nonblacks Hold Sharply Different Views of Martin Case
  • Europe’s banks face $323 billion capital hole | Reuters
  • Legal skull-duggery in Greece may doom Portugal – Telegraph
  • Why Being Sleepy and Drunk Are Great for Creativity | Wired Science | Wired.com
  • ‘Hispanics’ Like Clout, Not the Label – WSJ.com
  • Worthwhile Canadian Initiative: From gold standard to CPI standard
  • Dimitris Christoulas and the legacy of his suicide for Greece | Maria Margaronis | Comment is free | guardian.co.uk
  • Americans brace for next foreclosure wave | Reuters
  • FT Alphaville » Why QE is being mis-sold
  • Nicolas Sarkozy warns of Greek tragedy if France fails to re-elect him | World news | guardian.co.uk
  • India and the Euro Zone – a complete mess | The Big Picture
  • The David House Homeland Security Suit Goes to Court – NYTimes.com
  • Austerity may not be Portugal’s best option, warns IMF – Telegraph
  • California Woman Takes Distracted Driving To Entirely New Level – The Consumerist
  • Finance expert says speculators are behind high oil and gasoline prices – KansasCity.com
  • Ex-Con Man Says JOBS Law Makes Guys Like Him Rich – Bloomberg
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