Monday Market Comments 30/11/09

On the surface, today was a strong day on the market, up +118 points on the XAO, +2.6%.

This was a fairly narrowly based move. The only Industry Sector to outperform the XAO was the Financials Sector, up +4.2%. The Advance/Decline Ratio was only 1.6. That's more like the ratio you would expect on a 40 0r 50 point up day.

Small Ordinaries was up only +1.2% while the Fifty Leaders was up +3.0%, and the 20 Leaders were up +3.2%.

The Financials Sector has recently been the worst performing sector in the market. While we must acknowlege the strength of today's move in the general market, much of the movement seems due to a short squeeze in the Financial Sector.

So - it was a strong day - but the strength must be looked at with a certain skepticism.

This was more like a 1.0-1.5% up day than a 2.6% day. After last Friday's big down day - an up day was expected. Let's see what follow through buying there is in the next couple of days before believing that this is returning to the long-term bull rally conditions.