The week that was…
The market needed a pause after the frenetic post election rally, and it finally arrived this week. The pullback was mild as bulls would like. This week’s “fear of the week” was Italy’s political referendum which happened today… and was rejected.
Italian voters were asked in a referendum to approve changes to the country’s constitution, which have been called the most sweeping since the end of World War II. The proposed reforms would cut the Senate’s size by two-thirds and reduce powers held by the country’s 20 regional governments. Italian Prime Minister Matteo Renzi believes the changes will aid efficiency in parliament.
The reforms could also “make it easier to implement important legislation (such as measures to assist the country’s ailing banking sector) without the threat of a government collapse during periods of political disagreement,” said Peter Donisanu, global research assistant at Wells Fargo, in a note published Nov. 11.
So at times when the market needs to pull back a bit, it finds a reason; this was a pretty weak knee one but it is sufficient.
As I type this S&P futures are PLUNGING 0.3% on the “no” vote. Hide the children.Continue reading