The Market's Unheeded Flashing Signals

 | Sep 07, 2012 | 3:44 PM EDT  | Comments
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Stock quotes in this article:

fxe

,

cat

,

kmb

,

ko

,

fcx

,

pg

,

jnj

,

utx

,

mmm

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aa

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ba

Sometimes I feel that I am the only guy looking at stuff, because the moves are so breathtaking, I think no one should be talking about anything else.

I am talking about the gigantic breakout moves in copper and the euro today. These are big billboards saying "Buy China" and "Buy international companies with big European businesses," and I think not everyone is seeing it right.

First, 40% of copper is used by China. You can't get this lift unless something is really happening there, something meaning a lot more than what we have currently heard about.

Second, so many of our companies are using $123 on the CurrencyShares Euro Trust (FXE) as the benchmark for the quarter that if this keeps up, we are going to have revisions upward for Procter & Gamble (PG) and Kimberly-Clark (KMB) and Coca-Cola (KO) and Johnson & Johnson (JNJ), and they aren't moving up enough right now on that good news.

Sure, Caterpillar (CAT) and Freeport-McMoRan (FCX) are roaring. I like that. The coal plays have traction. But these are breakout moves that are game-changers. So much of what has stalled this market had to do with a breakdown of both of these.

What if we get a breakout?

I think there are plenty of stocks as diverse as United Technologies (UTX) and 3M (MMM) to Alcoa (AA) and Boeing (BA) that don't reflect either move.

Nah, the people I talk to? Everyone hates this market today as much as they hated it before.

Like it doesn't matter. Like nothing matters.

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