Tuesday, June 30, 2009

Marc Faber On Bloomberg- Short term Predictions June 2009

Marc Faber appeared on Bloomberg giving his short term outlook which contradict his long term outlook. His short term outlook is as follows..

- dollar will recover somewhat;
- bonds will rally;
- industrial commodities will be under pressure;
- gold will trade sideways to moderately down;

to watch the video click here

Buy Financial Stocks as Rally Persists, UBS Says

une 30 (Bloomberg) -- Financial stocks are poised to keep rising worldwide after posting this quarter’s best performance, according to Jeffrey Palma, a global strategist at UBS AG.

The industry stands to benefit from “a much improved backdrop,” Palma wrote yesterday in a report. He recommended that investors increase their percentage of assets in financials to a “modest overweight” relative to benchmark indexes. They had been “neutral.”

As the CHART OF THE DAY shows, financials are headed for the second quarter’s biggest gain among the 10 main industry groups in the MSCI World Index. They last set the pace in the second quarter of 2003, according to data compiled by Bloomberg. The chart has the MSCI World Financials Index’s quarterly rankings and percentage moves during the past six years, including this quarter’s gain through yesterday. (more)

Corn, Soybeans, Wheat Plummet as U.S. Farmers Boost Acreage

June 30 (Bloomberg) -- Corn plunged by the Chicago Board of Trade’s limit after a government report showed U.S. farmers planted more acreage with the grain than estimated in March. Wheat and soybeans also tumbled on signs of increasing supplies.

About 87.035 million acres were planted with corn, the U.S. Department of Agriculture said today in a report following a survey of farmers. That was up 2.4 percent from the March forecast on growers’ intentions and 1.2 percent higher than 85.982 million last year. The average estimate of 24 analysts in a Bloomberg News survey was for 85.16 million acres. (more)

The U.S. housing market has finally stopped accelerating into the abyss?

Both home price indexes delivered an annual return of negative 18% in April, S&P and Case-Shiller report today. While that’s still a lousy number, it marks the third month in a row of flat-to-rising annual rates of return… neither the 10- or 20-city index has set an yearly record decline since January.

We hasten to note that home prices are still falling -- S&P/Case-Shiller say home prices are down roughly 33% from their 2006 peak. But at least “the pace of decline has moderated,” as S&P likes to say.

“Every metro area, except for Charlotte, recorded an improvement in monthly returns over March,” adds David Blitzer of S&P. “While one month’s data cannot determine if a turnaround has begun, it seems that some stabilization may be appearing in some of the regions. We are entering the seasonally strong period in the housing market, so it will take some time to determine if a recovery is really here.

“The stock market bottomed in March and measures of consumer confidence have turned upward. This report shows that these better spirits are also appearing in the housing market.”

Funny Mr. Blitzer should mention consumer sentiment. The Conference Board’s measure of consumer confidence unexpectedly fell in June, the group reports today. Their index of consumer vibes slipped to 49.3, from a downwardly revised 54.8 in May… the Street was expecting a slight increase to 55. That’s the first fall in consumer confidence since April.

Wall Street Journal June 30, 2009

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