China Strong-Arms its Markets

Published January 8

China’s indexes conspicuously opened roughly 3% higher on Friday. Sure they had the benefit of currency inaction by government overseers, versus the devaluations of previous days, but the mood was entirely too sanguine nonetheless. For those of us already skeptical of the conventions of the mainland, rumors of government support of equities via strategic purchases were easily believable if not expected. For European investors, it appears the same holds true given their cautious reception of the news. And for U.S. markets, it will at least provide a reprieve, while we contend with critical economic data of our own that threatens to confirm China economic softness is contagious. See the full report on China Strong-Arms a Rally.

Sector Security	Early Indication 7:30 AM ET
SPDR S&P 500 (NYSE: SPY)	+0.6%
SPDR Dow Jones (NYSE: DIA)	+0.7%
PowerShares QQQ (Nasdaq: QQQ)	+0.7%
iShares Russell 2000 (NYSE: IWM)	+0.2%
Vanguard Total Stock Market (NYSE: VTI)	+0.4%
Vanguard FTSE Europe (NYSE: VGK)	-0.0%
iShares China Large-Cap (NYSE: FXI)	+0.9%
Deutsche X-Trackers Harvest CSI 300 (NYSE: ASHR)	+2.0%
iPath S&P 500 VIX ST Futures (NYSE: VXX)	-2.4%
SPDR Gold Trust (NYSE: GLD)	-0.8%
United States Oil (NYSE: USO)	+0.7%

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only. Article is relevant to Deutsche Bank (NYSE: DB), Banco Santander (NYSE: STD), ITA (Nasdaq: ITUB), UBS (NYSE: UBS), Westpac Banking (NYSE: WBK), Lloyds Banking Group (NYSE: LYG), Barclays (NYSE: BCS), Credit Suisse (NYSE: CS), Allied Irish Bank (NYSE: AIB), Banco Latinamericano (NYSE: BLX), National Bank of Greece (NYSE: NBG), Royal Bank of Canada (NYSE: RY), BBVA Banco Frances (NYSE: BFR), The Bank of Ireland (NYSE: IRE), Bank of Montreal (NYSE: BMO), Canadian Imperial Bank of Commerce (NYSE: CM), ING Groep (NYSE: ING), Citigroup (NYSE: C).

China's Death by a Thousand Cuts Policy

Published January 7

As I watched events unfold overnight, with China’s CSI 300 Index tripping its first trading curb in 13 minutes and its second after a half-hour of trading and two minutes after restarting, it became clear what the problem was. China is allowing the devaluing of the yuan, but unlike it managed it in August with one fell swoop, this time it is via several smaller devaluations. This death by a thousand cuts appears to be just as painful as the quick slice in August, but it should end soon, possibly even this week. That means that equities can start to recover starting next week, or importantly, when the yuan has reached the point where China will defend it again. Where is that? I’m hearing somewhere between 5.6 and 5.7 Yuan per U.S. dollar onshore; it’s currently at 5.5921. In other words, this is not a forever problem, so there will soon be an important point to buy stocks. However, I do not believe that point is today. As for China, I’ll have some proposals for its best steps to long-term prosperity, along with a purely communist solution in two follow-up reports. See the full report on China's death by a thousand cuts.

Sector Security	01-07-16 11 AM ET
SPDR S&P 500 (NYSE: SPY)	-1.0%
SPDR Dow Jones (NYSE: DIA)	-0.7%
PowerShares QQQ (Nasdaq: QQQ)	-1.0%
iShares Russell 2000 (NYSE: IWM)	-1.1%
Vanguard Total Stock Market (NYSE: VTI)	-0.9%
iShares China Large-Cap (NYSE: FXI)	-1.5%
Vanguard FTSE Europe (NYSE: VGK)	-1.0%

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only. This article should interest investors in Boeing (NYSE: BA), Raytheon (NYSE: RTN), Digital Globe (NYSE: DGI), GenCorp (NYSE: GY), General Dynamics (NYSE: GD), Goodrich (NYSE: GR), Northrop Grumman (NYSE: NOC), Honeywell (NYSE: HON), Lockheed Martin (NYSE: LMT), Rockwell Collins (NYSE: COL), L-3 Communications (NYSE: LLL), EMBRAER (NYSE: ERJ), FLIR Systems (Nasdaq: FLIR), BE Aerospace (Nasdaq: BEAV), TransDigm (NYSE: TDG), Spirit Aerosystems (NYSE: SPR), CAE (NYSE: CAE), Alliant Techsystems (NYSE: ATK), Hexcel (NYSE: HXL), Triumph Group (NYSE: TGI), Esterline Technologies (NYSE: ESL), Moog (NYSE: MOG-A), Heico (NYSE: HEI), Teledyne (NYSE: TDY), Curtiss-Wright (NYSE: CW), Cavco (Nasdaq: CVCO), Skyline (NYSE: SKY), Nobility Homes (Nasdaq: NOBH), Palm Harbor Homes (Nasdaq: PHHM), Mohawk Industries (NYSE: MHK), Interface (Nasdaq: IFSIA), Albany International (NYSE: AIN), Unifi (NYSE: UFI), Illinois Tool Works (NYSE: ITW), Tyco International (NYSE: TYC), Cummins (NYSE: CMI), Kubota (NYSE: KUB), Ingersoll-Rand (NYSE: IR), Dover (NYSE: DOV), ITT Corp. (NYSE: ITT), Flowserve (NYSE: FLS), Pall (NYSE: PLL), Dresser-Rand (NYSE: DRC), SPX (NYSE: SPW), Gardner Denver (NYSE: GDI), IDEX (NYSE: IEX), Nordson (Nasdaq: NDSN), Graco (NYSE: GGG), Actuant (NYSE: ATU), Middleby (Nasdaq: MIDD), ABB (NYSE: ABB), Eaton (NYSE: ETN), Nidec (NYSE: NJ), Rockwell Automation (NYSE: ROK), Ametek (NYSE: AME), Regal Beloit (NYSE: RBC), Thomas & Betts (NYSE: TMB), Woodward Governor (Nasdaq: WGOV), Caterpillar (NYSE: CAT), Deere (NYSE: DE), CNH (NYSE: CNH), Joy Global (Nasdaq: JOYG), Bucyrus (Nasdaq: BUCY), Agco (Nasdaq: AGCO), Emerson Electric (NYSE: EMR), Parker Hannifin (NYSE: PH), Roper Industries (NYSE: ROP), Pentair (NYSE: PNR), Waste Management (NYSE: WM), Republic Services (NYSE: RSG), Fastenal (Nasdaq: FAST), Vulcan Materials (NYSE: VMC), MDU Resources (NYSE: MDU), Martin Marietta Materials (NYSE: MLM), Owens Corning (NYSE: OC), Valspar (NYSE: VAL), Precision Castparts (NYSE: PCP), United States Steel (NYSE: X), Reliance Steel (NYSE: RS), CRH (NYSE: CRH), CEMEX (NYSE: CX), Eagle Materials (NYSE: EXP), Fluor (NYSE: FLR), McDermott International (NYSE: MDR), Foster Wheeler (Nasdaq: FWLT), Empresas ICA (NYSE: ICA), Stanley Black & Decker (NYSE: SWK), Timken (NYSE: TKR), Kennametal (NYSE: KMT), Leucadia National (NYSE: LUK), Masco (NYSE: MAS), Weyerhaeuser (NYSE: WY), Quanta Services (NYSE: PWR), Chicago Bridge & Iron (NYSE: CBI), EMCOR (NYSE: EME), Snap-on (NYSE: SNA), Toro (NYSE: TTC), GM (NYSE: GM) and Ford (NYSE: F).