Thoughts from Joe - July 20, 2012July 20, 2012 Posted by: Joe Morgan, CFA
Top EightThe IPO market is attempting a comeback after Palo Alto Networks and Kayak priced above their ranges and rallied on Friday. This week marks the most active IPO week post-Facebook with over $600 million raised. Next week, eight companies could go out raising north of $900 million. The IPO market is definitely back!
The Spanish bailout came through this week, but indicators continue to point to trouble ahead. Yields on Spanish 10-year bonds have swung from 7 percent down to 6.77 and back up to 7.23 at the end of the day Friday. The new Euro-era high in yields is a strong indicator that markets do not believe Spain can be saved. The dominos are falling and Spain won't be the last.
Fed Chairman Ben Bernanke appeared before Congress this week providing a downbeat assessment of the economy. In a slight disappointment to the markets, Bernanke offered no hint of QE3 anytime soon. The concern over QE3 is distracting from real economic challenges. Even those that want QE3 realize it is not a long term solution to economic woes. The sooner Washington begins to deal with our true issues - mortgage financing, fiscal issues, defining new regulations - the sooner recovery...Read More