Monday, May 11, 2009

Gloomy Monday and Semis

As we start the week, Asian and European stocks are mostly lower, U.S. Futures are lower, oil is lower, gold is lower. There is no big news, no good news, no earnings news and the banks are quiet. In short, it's a perfect morning to test whether the buyers of stocks need a break. It looks like they do.

I have been positive on the semiconductor trade from a cyclical perspective and was thinking that maybe it was time to take it off. The chart pictured is a 6-month view of the Semiconducor Holdrs ETF (black bars) vs. the S&P 500 (red line). The outperformance is hardly shocking, which makes me inclined to hang in there.

I am looking for more a-cyclical ideas, though.

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