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Sorry for the lack of posts yesterday. I was in and out of meetings all day, and will be today also. It happens.

This morning, the market is getting a strong bounce on the benign PPI data. Yesterday, the market also bounced strongly at the open, only to be knocked down like a feather by the closing bell.

If you've been reading me for more than a day, you now know why I don't like strong opens. I prefer a market that opens weak and builds strength into the close. How many times can the market sell-off late in the day before it totally breaks down? Just askin.

The core PPI actually fell this morning (-0.3% vs. +0.2% consensus). That's a pretty good sign that inflation has peaked, as I have been saying for a while now. And that is what the 10-year yield has been telling us.

The consumer staple stocks have been on fire (read: defensive). PEP announced the retirement of its CEO and still rallied. Check out the rallies in MO, K, GIS, etc. They are all up big. Have you seen the pop in DEO? Same story. I think this sector rotation is nearly played out, and it is time to start leaning the other way.

MMM authorized an additional $1 billion buyback. I hope that is enough to lift this stock off of the canvas.

There was also good pin action in the solar plays, courtesy of strong earnings from STP. My favorite related play there is WFR.

The NAR home sales report showed more slowdowns in housing prices. I'll try to do a wrap-up on that later. For now...more steam!

long DEO, PEP; net long WFR

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