WASHINGTON, October 11, 2013 — 2 p.m. Friday trading action finds the Dow Jones Industrial Average up approximately 100 points as yesterday’s irrational exuberance continues today after a tepid, tentative opening bell.
The broader-based S&P 500 average was up nearly ten points. The stock market is soaring once again as talks continue in Washington over ending a budget impasse that has partially shut down the government and threatened the U.S. with default. Short squeeze, anyone?
On an entirely different note, gold was hammered this morning by a massive trade that may or may not have been in error. In any event, a brief halt in trading was triggered before the order was completed. Gold is currently down in the neighborhood of $30 an ounce, very close to its lows of the year.
Action in the metal has remained suspicious since last fall, but it has been extraordinarily difficult to discover the reasons behind the yellow metal’s massive and continuing plunge. We’ve never been particularly fond of gold, long term, but we’ve never seen trading like this before in the metal. Then again, this is a market of, by, and for the bigwigs, so someone is making money off the gold bugs somewhere.
Meanwhile, despite two huge up days in the market, at least thus far, added to continuing happy talk emanating from Congress and the White House, the Maven finds it impossible to believe that some kind of clean solution to both the Federal government shutdown and the debt ceiling issue will unfold over the next 24-48 hours.
That, added to the fact that Monday’s Columbus Day holiday is also bank and bond trading holiday makes us mighty leery of putting on any sizeable position that will be exposed to some random politico’s intemperate remark over the weekend. Too dangerous.
If we’re indeed in rally mode again, there will be plenty of time to put on trades. If not, we may get whipsawed once again. And, having seen some of our early year brilliance wiped out over the last three months, we’re highly disinclined to leave things up to the loose lips of the Fools on the Hill over this almost-holiday weekend.
No trading recommendations today.
We’ll be back early next week, Monday if anyone is home on Wall Street, or, more likely, Tuesday when trading on all markets, including bonds, is back underway.
Have a good weekend. Here in DC, ours is likely to continue quite soggy, with the never-ending monsoons of the last three days appearing to be, well, never-ending. A bit like this nation’s budget wrangles.
Read more of Terry’s news and reviews at Curtain Up! in the Entertain Us neighborhood of the Washington Times Communities. For Terry’s investing and political insights, visit his Communities columns, The Prudent Man and Morning Market Maven, in Business.
Follow Terry on Twitter @terryp17
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