Stock-market charts of the day
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Dshort and Clusterstock both have eye-catching stock-market charts today:
These present two very different views of the recent rally. The first shows it to be a strong bounce off a deep low, which brings us back to a point which is perfectly normal for a recession. The second shows the bounce to be smaller, and largely a function of the weak dollar.
My feeling is that looking backwards at charts of where we’ve come is never a useful way of working out where we’re going. But the first chart does a good job of explaining why we’re all breathing so much easier now than we were in March, and the second chart does a good job of keeping us sober. And raises the question: if the euro weakens against the dollar, could that precipitate a broad-based stock-market fall?
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Since the S&P 500 has earnings overwhelmingly in US Dollars and, I would presume, stockholders who are overwhelmingly US-based, why would the strength of the Euro matter?