The S&P 500 has been rising steadily since reaching near-term lows roughly 10 days ago at 1627. The market is showing tremendous resilience. Interest rates are rising and the world’s economies continue to advance making equities the most attractive investment available. When new money is put to work, it is going into growth rather than income and risk rather than safety.
Syria may be a distraction. Japan’s Q2 GDP was revised up to 3.8% growth on an annualized basis from 2.6% and China claimed exports jumped higher-than-expected at a 7.2% rate in August. Strong economic growth in Japan is a very encouraging development as the economy has been plagued by slow growth, aging demographics and deflation for over three decades.
The Delta MSI remains bullish. Stay long equities. At the end of this week, we will see if the indicator is gaining strength. If the market is becoming technically stronger, we are likely to put new money to work.