The major market indices traded in a tight range as traders seemed to take bad news in Europe in stride.
Russia made mincemeat of the ceasefire agreed to in Minsk last week, while in Brussels Greek debt talks broke down.
Despite the news, Keith Bliss of Cuttone & Co. says Greece will not leave the eurozone despite their “posturing” to the contrary.
He thinks a deal will get done sometime next week and it will “soothe the markets even further. This market wants to go higher and you see that in today’s price action.”
A day before the Federal Reserve releases the latest FOMC minutes, Bliss also said that rate hike everyone has been waiting for is already baked into the market. Still, for those hanging on every word of Janet Yellen and company, Bliss says keep an eye on the word “patience” in the minutes and any future statements. He notes that as Yellen herself has said, “once that word comes out of the statement then look for a rate increase two meetings beyond.”
Bliss told Yahoo Finance that despite all these potential headwinds “the path of least resistance is higher” for markets and he is looking for the S&P 500 (^GSPC) to move higher towards the 2150-2160 level.
Oil continues its wild ride this week, something Yahoo Finance Columnist Rick Newman says will continue as long as oil policy in Saudi Arabia remains the same: That is to keep pumping oil out even while the supply is so high.
Newman contends the price of crude will continue to trade in this $45- $52 range until a change in that Saudi policy or something equally dramatic forces prices one way or the other.
Meanwhile, gold (GCH15.CMX) has now come back to Earth and is just 2% higher for the year, after being up as much as 10% this year thanks to market volatility, as well as concerns about Russia and Ukraine and Greece.
Yahoo Finance Editor-in-Chief Aaron Task says the return to the $1,200 level actually comes in part thanks to Greece. While investors hedged their bets with the yellow metal earlier this year, a consensus now seems to be forming that Greece will not leave the eurozone, thus making such hedges passe. Add to that higher U.S. Treasury yields (^TNX) and Task says investorS will opt for those in favor of gold.
Wild weather in the Midwest and the Northeast, coupled with a worker slowdown / strike at major West Coast ports could make for a significant drag on Q1 GDP.
Rick Newman shrugs off any concern, noting that weather is always a bit of a drag in Q1 and the port issue has yet to reach a level that will have any long-lasting impact. Still, he admits that when the port issue starts moving away from small things like coffee cup sleeves and onto car parts that slow down auto production it’s at least worth keeping an eye one.
Task says the ports in question account for 12% of the country’s GDP and would be a “huge deal” if no agreement were struck to keep things moving there.
The New York Times is citing a new study out of George Washington University that argues the wealth gap has actually not gotten any wider since the economic crisis that started in 2007.
While the numbers may not lie they also don’t tell the whole story. The rich are still richer and the poor are still poorer.
What happened was that the rich simply had more to lose during the crisis and have yet to make it all back yet.
As both Rick Newman and Aaron Task note, the timeline of the study is narrow. While the data may be accurate for the sliver of time from the beginning of the crisis to now, the gap is still a huge problem when you take a look from 2000 to today or even more from the 1970s to today.
“The wealthiest in this country and around the world continue to gain wealth while the average American, their wages are stagnant if not down,” says Task. “The rich are doing better and the average person is doing worse.”
What do you think? Is the wealth gap still a problem? Is it getting better or worse? Let us know on Twitter @YahooFinance.
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