I’d say this light volume rally causes me to be wary.

Seriously, where’s the supporting news for this rally?

Earnings ahead are going to be lower and economic data remains weak. But, there will be more cheaply financed stock buybacks. Is that the only news? We’re still waiting.

Brazilian economic downturn took a real turn for the worse in February,"according to Markit's Composite PMI, which collapsed to record lows at 39.0. Despite a slightly less bad than expected GDP print this morning (still down a record 5.89% YoY), hope was quickly extinguished as PMIs showed economic activity continuing to contract at a record pace, job losses accelerating, and manufacturing's collapse accelerating.

As Markit sums up,"With the global economy also showing signs of slowing, which will impact on external demand, it looks as if the downturn is set to continue to run its course in the coming months."

That news allowed the Brazil ETF to rally nearly 7.5%. What!? Yeah, things are getting irrational. Below are some Brazilian economic charts courtesy of ZH.

What else was going on Thursday? PMI Services Index fell below a critical level to 49.7 vs prior 53.2; ISM Non Mfg Index fell slightly to 53.4 vs prior 53.5.

Factory Orders rose to 1.6% vs prior -2.9% and Productivity fell to -2.2% and Costs rose to 3.3% which isn’t good.

Oil prices fell Thursday and so did the dollar which led to increases in gold prices. The weird thing about the latter came from Canada. The country had always been a reservoir of hard assets. Today it was announced the country had liquidated its entire inventory of gold. This shocked most investors. It may be the new government of Trudeau and his more socialist policies at work.

Investors are anxiously awaiting Friday’s Employment Report.

Market sectors moving higher included: Small Caps (IWM), Financials (XLF), Banks (KBE), Regional Banks (KRE), Consumer Discretionary (XLY), Industrials (XLI), Energy (XLE), Energy MLPs (AMLP), Consumer Staples (XLP), Retail (XRT), Europe (VGK), Midcaps (MDY), EAFE (EFA), Brazil (EWZ), South Korea (EWY), Australia (EWA), Russia (RSX), India (EPI), Canada (EWC), Emerging Markets (EEM), Gold (GLD), Gold Stocks (GDX), Silver (SLV) and many others.

Market sectors moving lower included: Volatility (VIX), Biotech (IBB), Crude Oil (USO).

Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red).

Chart Of The Day

The commentary shortened as we await Friday’s Employment Report.

Let’s see what happens.