Sometimes the markets don’t reflect what happened (a.k.a. the fundamentals), but who is buying and selling (a.k.a. supply and demand.)
Tuesday’s rising Treasury bond prices and falling yields were more the result of Asian central bank-buying than a weak New York Empire State manufacturing survey, according to traders. Oil and other commodity prices continued to fall as hedge funds pull riskier investments off the table to ready themselves for a possible liquidity withdrawal.
Meanwhile, the earnings parade had a negative tint Tuesday, but the Dow Jones transports continued their rally — growing ever nearer to “confirming” the Dow Jones Industrial Average’s latest record close; the latter index closed up 0.2% to an all-time high of 12,582.59.
