Mon, March 21, 16
08:45 ET Update: [Stockboardasset] S&P futures -09bps
08:45 ET Update: [Stockboardasset] Nikkei -0bps
08:45ET Update: [Stockboardasset]FTSE100 -16bps DAX -25bps
US Companies are set to report a dismal earnings season for 1Q. “If the index reports a decline in earnings for Q1, it will mark the first time the index has seen four consecutive quarters of year-over-year declines in earnings since Q4 2008 through Q3 2009”– FACTSET. A tactical reset in valuations for the SPX is at 1700. The number 1 buyer of corporate equity are corporations themselves. Expect a blackout of buybacks to commence as earning season starts. The great divergence of market price vs. fundamentals is at an all time high. A decade of ZIRP, and now NIRP is leading global economies into a liquidity trap. The latest rally in equities and commodities have had an absence of fundamentals due to 3 central banks priming the market in a coordinated fashion. Last year, this tactic by central banks would of only taken 1 , but shows the belief system in central banks is waning. Central Banks generate an illusion that markets cannot go down. We’ve seen this in the 2-year Dome (rounding top) in US Equities. Growth will not return to US markets until 2H16. We continue our call of finding the unfair high of this so-called rally and play reversions to point of control SPY low 190s.