Despite the headwinds of higher oil prices, surging interest rates (chart above is 1-3-year bond prices SHY) and higher industrial metals, US equity markets digested strong gains from the prior week ending down less -.5%. The exception was the Russell 2000 (IWM) that was up 1.2% closing at new record highs on Friday on big weekly volume.

US Equity inflows totaled almost nine billion which mostly flowed to those small caps (IWM) which we have been highlighting as the emerging leader over the past several weeks. Momentum often precedes price and that has been clear read from our real motion indicators. Click here for the replay of the recent training.

Perhaps the pomp and circumstance of the upcoming royal wedding provided a respite from the normal spate of negative news by overcoming those soaring rates, energy prices amid rising geopolitical tensions.

Another point of interest it that the Israeli stock market put in a positive week despite the border war on the Gaza Strip. Another case of trade on the rumor and reverse on the news.

Global equity markets did not fare quite as well with some countries losing almost 5% (Italy, Mexico and Brazil) so once again US equities led the global equity markets. Populist movements across Europe are winning the popular vote which is not exactly good for global trade and hits emerging markets the hardest. In terms of sectors transportation (IYT) needs to take out recent highs to get things really percolating.