Mr. Market waits for the Fed minutes tonight about the tapering continues or not. My bet is no or a slight tapering further. Within few hours we are going to have ADP employment data from US and Friday the nonfarm-payrolls data. All macros are crucial about the directions. Now the SP500 is in consolidation mood and doing nothing serious, but I suppose this week we are going to see breakout, my bet is a long breakout.
The peripheral markets are doing well in these ranging market climate in the last few days. In sort of quiet trading days yesterday only the IBEX could gain significantly with more than 3%. The Spanish and Italian indices did well yesterday. My bet for this year these two indexes we have to own and buy. Why? The reason is obvious. They are both brutally underperformed in the last years. Most of indices are on historical record levels and Madrid and Milan still massively lagging. This rally could continue in longer term in quarterly or yearly basis.
Fundamentally Spain is doing well and macros are better and better from Iberia. The unemployment is declining, the GDP grows steadily and revised in each quarter to higher levels. So I don’t see recently any huge risk on the buying side.
Ibex chart:
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