Morning Note: We have serious 'fundamental' concerns, however...

You'd expect that a trillion dollars of fresh government spending would have the Dow up triple digits. And you'd also expect that such support for markets would have money screaming in, in a real FOMO (fear of missing out) sort of way.

Well, that's a yes on the former. However, on the latter, not so much, at least at this early hour: The S&P 500 is seeing volume 33% below its 20-day average for this time of day. Even looking at the 5-day average, which captures the typically low-volume Christmas week, it's 35% below average. 

Now, that said, low-volume is absolutely to be expected during any holiday week, so -- despite the additional government support -- we won't make too much of it.

What is definitely a positive, on the other hand, this morning is breadth. As I type 417 of S&P 500 members are trading higher, 87 lower. That's bullish!

Asian equities leaned green overnight, with 11 of the 16 markets we track closing higher.

Europe's higher literally across the board, with all 19 bourses we follow in the green as I type.

U.S. major averages are all positive as well: Dow up 283 points (0.94%), SP500 up 0.79%, Nasdaq up 0.35%, Russell 2000 up 0.60%.

The VIX (SP500 implied volatility) is down 1.02%. VXN (Nasdaq i.v.) is up 0.50%.

Oil futures are up 0.10%, gold's up 0.73%, silver's up 3.21%, copper futures are up 0.68% and the ag complex is down 0.63%.

The 10-year treasury is down (yield up) and the dollar's off by 0.15%.

Led by silver, oil service companies, energy, banks and Eurozone equities, our core portfolio is up 0.60% to start the day. Ag commodities is our only down position thus far.

While, as you've noticed, we have serious concerns about the fundamental health of equity markets going forward, per the following from Part Four of our year-end letter, we see opportunities in certain sectors (and certain commodities) to (operative word) carefully exploit, nevertheless:

"For the moment, while policymakers' backstopping stocks is plenty to like all by itself, it would indeed be a stretch to, at this time, confidently expand a list of good reasons to own them -- in the aggregate, that is.

On a sector by sector basis, however, absolutely, when, for example, we consider infrastructure spending on the horizon, and, thinking globally, when we branch beyond U.S. borders, there are indeed opportunities in stocks to be thoughtfully exploited going forward."

Have a nice day!
Marty