Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
We are currently in one of those teflon markets where nothing affects it. Thus far (very early in the season) earning reports are beating expectations by the lowest % since the recession ‘ended’. Usually that would be a bad thing. But right now the market could care less – any piece of good news is enough to buy and crowd out the noise from the misses.
If you are keeping track at home, we are on pace for a 50%+ type of gain this year. And it could be the first year on record with no weekly losses. 
At this point everyone (and their mother) is pointing to S&P 1350 as the next rest stop. Rarely is “everyone” correct. So more likely the index either stops short of that level or blows right past it. I would be shocked to see a scenario where a figure every silicon and carbon based life form is pointing at, conveniently serve as accurate.
Mutual fund inflows have been negative for a long time. The teflon market has finally turned that tide – we see the first inflows since August 2011. For some this will be yet another contrarian indicator. That said, this market has been steamrolling over anyone who is listening to any contrarian signals. It is punishing anyone not fully long or utilizing hedging…. or as David Tepper says “balls to the wall”.
Domestic stock funds saw infllows of $753 mil per ICI. First weekly inflows since Aug 17, 2011.
Disclosure Notice
Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). For a list of the aforementioned fund’s holdings at the end of the prior quarter, visit the Paladin Funds website at http://www.paladinfunds.com/holdings/blog
