* I call B.S. to the broadening (and healthy) market thesis...
Lesson # 7 Markets are strongest when they are broad and weakest when they narrow to a handful of blue-chip names…
– Bob Farrell, “10 Investing Lessons”
On CNBC, a perma-bullish technician (Ryan Dietrich) just suggested that today was another day in which the advance in equities is healthy and broad.
I call B.S.
This chart exemplifies the narrowness of the markets (with only one of 11 S&P groups showing better than average strength):
For now I wouldn’t even look for a broadening of this market and I would not suggest buying any of the battered sectors (like consumer staples or consumer discretionary).
Investors are narrowly focused on large-cap technology.
If I wanted to diversify, I would purchase short-term treasuries.
Doug Kass is a world-renowned hedge fund manager with decades of experience and success navigating through some of the most turbulent periods in market history. He is known for his time-tested analytical skills and ability to look past the current noise and herd mentality.
On TheStreet Pro, Kass provides frequent market commentary and investing ideas for active investors throughout each trading day in Doug’s Daily Diary. He also serves as president of Seabreeze Partners Management Inc. Previously, he served as a senior manager at Omega Advisors, a $6 billion investment partnership. He co-authored a book with Ralph Nader and the Center for the Study of Responsive Law called “Citibank: The Ralph Nader Report” and can be found as a guest host on CNBC's "Squawk Box."
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