The Great Stock Market Bubble of 2013 Continues To Percolate

Equities start the day higher as the Great Stock Market bubble of 2013 continues to percolate. Since every major publication only writes about bubbles now I may as well join the fray. Do I think the market is a bubble? Of course not, but I hate missing out on trends (like bitcoin for example, how am I missing this? It basically only goes up). 1,798. We closed at 1,798 on Friday…amazing. Now you know me, you know my style, you know I’ve been bullish for a while. So while I don’t think this market is a bubble I am a bit concerned about consensus. Most people think the rally will continue into year-end unabated, in fact you’d be hard pressed to find someone (other than a permabear) who thinks it’s a good time to dance on the sidelines. That bothers me a bit, it’s almost never this easy. Does it blow your mind that a 20% correction wouldn’t even wipe out 2013’s gains? I know that’s not groundbreaking stuff but it’s weird to hear it that way. No real news overnight, just a futures ramp near the open as everyone wanted to see that magical 1,800 level. Hey, at least we got breadth on our side, that’s a great thing for the “non bubble” crowd. Anyway, let’s see what kind of trouble we got in today.

After the open we hit 1,800 within the first minute! You know what’s great about where the S&P is trading right now? I can start making random historical references no one will get. 1,800 you say? That was a great year for the U.S. The Library of Congress was founded and the flag featured 15 stars and 15 stripes. If you aren’t bored with my market musings wait until I hit you with 19th century Russian history! So yea, Mondays have become the defacto “no one cares” day and this one was no different. Very very quiet all morning long as we hovered around unchanged. Last Monday featured a 1 pt range for most of the day. However, and this is insane, we were three times as volatile today! A whole 3 point range! Boom! No crazy stock moves to make fun of either, just your garden variety churning. Winners DNB, PCP, TSN, BA, and JPM. Losers IGT, PXD, SWY, CNX, and TSLA (this thing is melting down…yea I said it). But I’m optimistic! As optimistic as these people in London that something juicy will happen this week! (they realize the sun comes out like 10 days a year in the UK right?). By lunch we sat on unchanged going nowhere fast.

 

Late in the afternoon a couple headlines hit saying that Icahn is “cautious” and thinks the market “could easily have a big drop”. Come on Uncle Carl, what are you doing to us here? All you had to do was keep knocking on CEO doors and asking for bigger dividends and everything would’ve been fine! Now you’re out there calling top? Oh the humanity. Well, that was it for sideways price action, and by the close we landed on 1,791 down 37bps. One guy, one sentence, instant losses. Think people are a little jittery up here? You think the ability to move an entire stock market is intoxicating? It has to be right? Does Icahn go home and say “Honey, I moved the deepest most liquid stock market in the world with a few random quotes. Now let’s eat that pot roast!”
Final Score: Dow +9bps, S&P500 -37bps, Nasdaq -98bps, Rus2k -80bps.

 
News Highlights:

We’ll end tonight with some crazy skating skills. How long does it take to learn this stuff? Is this a couple year kind of thing? Or a lifetime kind of thing?

 

http://youtu.be/PJ_fFrdSKlg

 

Have a good night.