Stocks are higher this morning on the heels of a Stock rally in China that was ignited by the Chinese government's plan for a $586 Billion stimulus package. Should Stocks hold or add onto their gains, it will likely add selling pressure to Bonds. Also adding selling pressure to Bonds this week will be auctions of Treasury Notes today and Wednesday.
In other news, the poor economy is being felt across the board, as Circuit City filed for Chapter 11 Bankruptcy and the department store Nordstrom is reporting that its growth rate is down 16%. Additionally, the automobile industry’s woes continue, as Deutsche Bank downgraded shares of General Motors from hold to sell, giving a price target of $0...yes, $0.
Currently, Bonds sit very close to both the 50 and 200-day Moving Averages. For now, I recommend floating, but I will keep you posted of any changes. The Bond market closes early today at 2 pm Eastern Time and will be closed tomorrow for Veterans Day. Stock markets, however, will conduct their normal business hours this week.
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