© 2012 ROHR International, Inc. All International rights reserved.

The full calendar is available through the link in the right hand column. The focused comments below it are already available as well in the calendar section this week as Summary Perspective on Key Influences. We hope you find that useful as well.

For those of you who have not already seen it, there was also a fresh post yesterday on some of the factors that might in fact buffer the current ‘crisis’ risk-off atmosphere to some degree. It cites the interesting combination of both the ECB and the Fed likely being a bit more willing to provide accommodation if equity markets continue to deteriorate. And in spite of the current rhetoric, it is still unlikely there will be any overt military reaction to Iran's continued nuclear program intransigence.

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© 2012 ROHR International, Inc. All International rights reserved.

Short & Sweet on the specific market comments in this post, because we are out today with the UK and Europe. That said, Friday’s TrendView Market Alert was also a view on some very interesting influences coming up early this week. Might this possibly be the beginning of a more substantial significant trend reversal in equities? That's quite a bit more problematic into the beginning of a new quarter and the June S&P 500 future only dropping to initial support at 1,375-67 so far. 

And without a new trading high of any substance last week (i.e. only marginally above the previous week’s 1,415.50), there is not even a bona fide pattern top in place. While across time the equities might still be topping out, the seasonal phase and significant support below the market indicate any major trend reversal will most likely occur on a ‘trading’ basis. There will more likely be some further filling out in a more convincing top between the mid-1,300 and low-1,400 area than any further sharp capitulation.

That said, there are a couple of wild cards out there.

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© 2012 ROHR International, Inc. All International rights reserved.

Just as with his predecessor J. C. Trichet, ECB President Draghi’s post-rate decision press conferences are always interesting affairs. And possibly even more so under his regime, due to his leaning toward far more accommodation than anything Monsieur Trichet would have ever allowed. And that left a key question unanswered today, because it went unasked.

Yet, along the way there was quite a bit of interesting insight. ECB vice president Vitor Constâncio explained the degree to which €50 billion of rescue funds were likely enough to recapitalize and reorganize ailing Greek banks. That was certainly a constructive bit of insight.

There was also the reconfirmation that the current European Social Model is dead. Signore Draghi was quick to point out that this only meant the current form of it, and not Europe's overall commitment to social efforts. (More on that below.)

However, one of the most interesting exchanges of the Q&A after the formal statement was (typically) from Ralph Atkinson of the Financial Times. The original question was not specifically on the topic of quantitative easing (QE.) Yet, the ECB President launched into an explanation of why its extended operations were NOT a form of QE. And that is where (in our humble opinion) the most interesting question went unasked…

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© 2012 ROHR International, Inc. All International rights reserved.

Whatever the other asset classes may be doing, it is a very interesting equity market right now. And spite of some still formidable tail risks in Europe and the like, the market does have reasons to be encouraged. As we noted in our formal research, this week sees the information equivalent of carpet bombing by the liquidity infusion-oriented major central banks.

For those who’ve been reticent about diving into the equities since the first of the year, there seems a compelling (Nike-inspired) “Just Do It” imperative to not miss the further appreciation. And various factors this week would seem to support the idea the equities will find encouragement from quite a few quarters.  After FOMC minutes this afternoon, it’s the ECB meeting and press conference tomorrow, all followed by the Bank of England meeting and somewhat limited statement on Thursday.

What we know for certain is moderate (Goldilocks “not too hot, not too cold”) US growth was highlighted again in the FOMC minutes. That will be seen as constructive, while allowing (‘50s pop group) Benny & the Doves to maintain further QE (quantitative easing) potential. Even if that was played down in the minutes, the rate hike horizon being pulled forward to late 2013 somehow does not seem much of a threat. The perception remains QE will be implemented if the economy weakens. There is still a ‘Bernanke Put’ out there.

There will also likely be another upbeat ADP Employment Change report tomorrow, driving bullish anticipation for Friday's US Employment report. So after relatively constructive global Manufacturing PMI's and other economic data, the only question becomes why aren’t the equities stronger?

It seems that on both the data and the central bank influences a June S&P 500 future that Closed yesterday above the 1,400-07 resistance for the second time in the current rally should have been doing better. Might it be that there are some broadly acknowledged tail risks out there, even if they are not dominant at present? Maybe it’s the Triple-E threat!

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© 2012 ROHR International, Inc. All International rights reserved.

The full calendar is available through the link in the right hand column. The focused comments below it will be available in the calendar section shortly after the weekly calendar is posted each week as Summary Perspective on Key Influences. We hope you find that useful as well.

For those of you who have not already seen it, there was also a fresh post on Friday regarding an insight into how the current US administration views economic theory and practice: Quick Post: Obamanomics encourages OSD (Occupy Supply-Demand) Movement. It cites an interesting section of Mr. Obama’s mini-speech from last Thursday on repealing oil company subsidies that revealed either a lack of understanding or desire to ignore the basic laws of economics.

It’s a critical mid-week decision horizon this week. Not to say that there are no important influences at the end of the week as well. Especially the truncated US trading session on Friday (fools!!) to allow for a reaction the US Employment report will be telling.  However, most of what is potentially radical in the market influences rolls out of heavy central bank releases or activity between Tuesday and Wednesday. 

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