Strong Dollar

Monday, stocks moved little in Asia and gained slightly in Europe as the U.S. markets were closed for Labor Day. Tuesday, in Asia, Europe, and the U.S. stocks went nowhere on very low volume. Precious metals tumbled about 2% on dollar strength and miners fell about twice that amount. Wednesday, stocks rose 0.8% in Asia, 0.7% in Europe, but just slightly in the U.S. on very low volume. Here’s a link that claims stock bearishness has descended even further.

Thursday, in Asia stocks changed little, but they ramped up sharply in Europe in response to more easing by the European Central Bank. In the U.S., stocks dropped 0.4% on low volume. During the day, the S&P 500 Index hit another all-time high, but by the close, it had dropped below the magic 2000 mark. Precious metals fell 1% on dollar strength (as the Euro fell below 1.30 dollars) while precious metals miners fell more than twice that amount. Fear crept up with VXO rising nearly 5% to close at 11.67.

Friday, stocks fell 0.3% in Asia and 0.4% in Europe, and the U.S. on low volume bringing the S&P 500 Index to a new all-time closing high just in time for the weekend — mission accomplished. The VXO to end the week at 10.41. Friday’s gain in stocks was basically the gain for the week as well.