Welcome Stockaholics to the trading week of September 26th! This past week saw the following moves in the S&P: Major Indices End of Week: Bird's Eye view of the Major Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday Earnings: Vail Resorts, Carnival, Cal-Maine Foods 9:30 a.m. Minneapolis Fed President Neel Kashkari 10 a.m. New home sales 11:45 a.m. Fed Gov. Daniel Tarullo on stress testing 1 p.m. $26 billion 2-year note auction 1:30 p.m. Dallas Fed President Rob Kaplan 9 p.m. U.S. presidential debate Tuesday Earnings: Nike, Markit, FactSet, Cintas 9 a.m. S&P/Case-Shiller home prices 9:45 a.m. Services PMI 10 a.m. Consumer confidence 11:15 a.m. Fed Vice Chair Stanley Fischer at Howard University on why study economics 1 p.m. $34 billion five-year note auction Wednesday Earnings: Paychex, BlackBerry, IDT, Pier 1 Imports, Actuant, Progress Software 8:30 a.m. Durable goods 8:45 a.m. Minneapolis Fed's Kashkari 10 a.m. Fed Chair Janet Yellen testifies on supervision and regulation, House Financial Services Committee 10:15 a.m. St. Louis Fed President James Bullard 1 p.m. $28 billion 7-year note auction 1:30 p.m. Chicago Fed President Charles Evans 4:35 p.m. Cleveland Fed President Loretta Mester 7:15 p.m. Kansas City Fed President Esther George Thursday Earnings: PepsiCo, ConAgra, Costco, Accenture, CalAmp 5 a.m. Philadelphia Fed President Patrick Harker 8:30 a.m. Initial claims 8:30 a.m. GDP Q2 (third read) 8:30 a.m. International trade (Aug adv) 8:50 a.m. Atlanta Fed President Dennis Lockhart 10 a.m. Fed Gov. Jerome Powell 10 a.m. Pending home sales 2:30 p.m. Minneapolis Fed's Kashkari 4 p.m. Fed Chair Yellen speaks via videoconference with a forum for minority bankers, Kansas City Fed Friday Earnings: McCormick, The Container Store 8:30 a.m. Personal income/spending 9:45 a.m. Chicago PMI 10 a.m. Consumer sentiment
Gold Tops Bonds, Stocks In Week When Fed Crushed Economic Growth Hopes Cheer Up Janet... On the week, gold beat bonds, stocks, and commodities (but silver beat gold).. And reflecting The Fed's policy error/downgrade, the Treasury yield curve plunged this week - down the most in over 2 months... (along with the USD Index) On the week, Small Caps outperformed (on the big squeeze from fed to Thursday open)...Ugly close though... Post-fed, bonds and stocks ended exactly equal -just ahead of gold... Macro data was all ugly... Treasuries rallied with yields tumbling post Fed (and notably flattening)... The Treasury yield curve flattened and Financials dropped... Oh and The BoJ's move to steepen the curve to help banks has failed miserably... The USD Index ended the week lower despite rallying back from the post-Fed dump... As Art Cashin noted "I am surprised at the gullibility of traders in the oil pits" as oil spiked on rumors and dumped again on news... PMs just drifted higher all week... And gold soared (2.2%) most in 5 months this week and silver spiked around 5% (most since Brexit) Charts: Bloomberg Bonus Chart: Probably Nothing Still...
Spoiler: Weekend Reading: Fed Saves The Bulls Submitted by Lance Roberts via RealInvestmentAdvice.com, As I noted on Thursday, the Fed non-announcement gave the bulls a reason to charge back into the markets as“accommodative monetary policy” is once again extended through the end of the year. Of course, it is not surprising the Fed once again failed to take action as their expectations for economic growth were once again lowered. Simply, with an economy failing to gain traction there is little ability for the Fed to raise rates either now OR in December. However, it was the docile tones of the once again “Dovish” Fed that saved market bulls from a “bearish” rout. The recent test of the bullish trend line from February lows combined with a move back of the 50-dma clears the way for the markets to retest, and potentially breakout, to new highs. With economic data remaining extremely weak, and leading indicators continuing to roll over, the “bad news is good news as the Fed stays on hold” scenario continues to play to investor’s favor….for now. The question that remains, of course, is when does the reality of the weak economic environment begin to impact the fantasy of stock prices. It was interesting that Janet Yellen mentioned “commercial real estate values” in her latest comments to the press. To wit: “Yes. Of course, we are worried that bubbles will form in the economy and we routinely monitor asset valuations, while nobody can know for sure what type of valuation represents a bubble, that’s only something one can tell in hindsight, we are monitoring these measures of valuation and commercial real estate valuations are high. Rents have moved up over time, but still, valuations are high, relative to rents.” DO NOT misunderstand the gravity in her statement. Commercial Real Estate (CRE) valuations are a direct function of the economic cycle. The tenants of CRE buildings are companies that are affected by the ebb and flow of the economy. The reason that valuations are high relative to rent is due to the fact we are at a peak of an economic cycle. CRE values FALL during an economic recession as tenants give back space and vacate buildings. What Janet Yellen said, without saying it, is that stock market valuations are high as stock prices have been bid up by investors just as with CRE. When CRE valuations fall, so will asset prices along with valuations. However, for the moment, none of this matters. Global Central Banks continue to push assets into the market for now in the ongoing “chase for yield.” However, it is worth repeating that nothing last forever, but it can, and often does, last longer than you can imagine. Unfortunately, so does the reversion to the mean. But, in the meantime, here is what I am reading this weekend. Fed / Economy Promise In Sept., Deliver In December by Danielle DiMartino-Booth via Money Strong When The Music Stops by Teddy Vallee via Pervalle.com Trump’s Guide To Weak Labor Market by Sarah Ponczek via Bloomberg Harvard University Crushes Obama’s Recovery Story by Tyler Durden via Zerohedge Deutsche Bank: Recession Indicators Are On by Akin Oyedele via BI The Wealth Effect Was Never Valid by Jeffrey Snider via Alhambra Partners Is The Fed Politically Biased by Jim Puzzanghera via LA Times The Fed Of Yesteryear Is Dead by Robert Samuelson via RCM Balance Sheet Anxiety by Scott Sumner via Econolib Monetarists Are Out Of Ideas by Noah Smith via Bloomberg US Economy Recovering? Hardly! by Jim Clifton via Gallup Fed Faces A Credibility Problem by Patrick Gillespie via CNN Money The Fed’s Growing Economy; Never Mind by Joe Calhoun via Alhambra Partners Markets This Market Sell-Off May Be Different by Mohamed El-Erian via Bloomberg The Most Important Charts by Akin Oyedele via BI S&P To Tumble To 20-year Lows by Sue Chang via MarketWatch Goldman: Stocks Could Crash By 25% by Bob Bryan via Business Insider The Economy & The Stock Market by Pater Tenebrarum via Acting Man blog How The Fed’s Decision Could Affect Stocks by Michael Kahn via Barron’s Is The Mother Of All Corrections Coming? by Jeremy Warner via The Telegraph Oil Prices At $70? Not A Chance by Tim Daiss via Forbes Inflation! The Good Kind & The Bad by Ed Yardeni via Yardeni Research Bond Market Will End Badly by Brett Arends via MarketWatch Investors Have No Place Hide by Nigam Arora via MarketWatch More Pain For Stocks To Come by Michael Kahn via Barron’s Most Dangerous Market I’ve Ever Witnessed by Tyler Durden via ZeroHedge The Shrinking U.S. Stock Market by Political Calculations Fed & Stock Market Performance by Mark DeCambre via MarketWatch Interesting Reads Deplorables: Who We Are & What We Want by Brandon Smith via Alt-Market The Coming Anti-National Revolution by Robert J Shiller via Project Syndicate Obama’s Victory Lap On Incomes Premature by Stephen Moore via The Washington Times The Essence Of Decision by Ben Hunt via Financial Sense 7 Lessons People Learn Too Late In Life by Nicolas Cole via Inc. Everything Paul Krugman Says Is Wrong by Robby Soave via Reason WFC – TBTF & Too Arrogant To Admit It by Dana Milbank via Washington Post Justify Your Smart Beta Methodology by Rob Arnott & Chris Brightman via ETF.com Fed Meetings And The Markets by Value Walk Support Drops Away by John Hussman via Hussman Funds Just Plain Pathetic by David Stockman via Contra Corner Traders Quickly Get Comfortable With Stocks Again by Dana Lyons via Tumblr C0rporate Buy Back Binge Blows Another Bubble by Jesse Felder via The Felder Report “Fed Says Economy Is Weaker And Stocks Go Up. If We Get A Depression I Will Be Rich!” — Richard Rosso, CFP.
End-of-Q3 challenging—final five trading days S&P 500 down 7 of last 8 years Since 2008, DJIA, S&P 500, NASDAQ and Russell 2000 have not fared all that well during the last five trading days of the third quarter, the end of September. 2010 was the last year where the major indices produced solid, across-the-board gains. S&P 500 has been the worst since 2008, down 7 of the last 8 years during the last five days of Q3. Top Sectors to Ponder For the “Best Six Months” For 50 years the new edition of the Stock Trader’s Almanac has been released early in the fourth quarter. And for the past fifteen years we have been preparing Almanac Investorreaders for the annual October ETF buying spree. This year is no exception, but before delving into October’s seasonalities, let’s do a quick review for new and seasoned followers alike. Every year while preparing the annual Almanac, we revisit and analyze our sector seasonalities (STA 2017 pages 94, 96 and 98) in depth in order to make adjustments for any new or developing trends. There have been a few minor revisions made to our Sector Seasonalities table in recent years, but for the most part, sector seasonality has been reasonably on track since September 2009 with many sectors producing the bulk of their annual gains during their traditionally favorable periods. Years of sector research allows us to specify whether the seasonality starts or finishes in the beginning third (B), middle third (M) or last third (E) of the month based upon the number of trading days in the month. The 2017 Almanac table follows. Keen observers and long-time readers will note the absence of several indices. Indices that no longer appear are no longer being calculated or are not readily available in the public domain. In the place of discontinued indices we have added S&P Sector indices. Both long and short trade opportunities are researched and the most statistically viable appear below. Complete table available to Almanac Investor Subscribers These entry and exit points will be the basis for our seasonal trades over the coming year. They are guidelines, as we generally look to enter new positions before the start of the favorable period and exit before its end. Occasionally a trade is closed out well in advance of the seasonality’s end. An outsized advance may trigger a trade at the suggested auto-sell price (a price target based upon past historical performance of the specific seasonality) or should strength fail to materialize, a stop loss could be reached.
Stockaholics come join us in our weekly market poll as well our stock picking contests for this upcoming week ahead! Stockaholics Weekly Big Board Contest & SPX Sentiment Poll for the Week of (9/26-9/30) <-- click there! It would be awesome to see all of you regulars here at Stockaholics join in and participate on these polls & contests... Hope you all have a great weekend!
Weekly market wrap and Sector watch for Sep 23-20 2016 Just a profit taking breather heading into the weekend. Bulls have retaken control after another Fed driven rally
ShadowTrader Video Weekly 9.25.16 - Buy more Alibaba, Stop buying Video from ShadowTrader Peter Reznicek
Earnings Releases due out for this upcoming week ahead are: $NKE $CCL $COST $BBRY $MTN $PEP $PAYX $THO $CALM $ACN $CTAS $SNX $FDS $CAG
I hope people do exactly the opposite of whatever I predict -- said people would be millionaires by now! I thought we'd have a nice break of the RUT's RTL, I had another 1/3-sized tranche ready to go on my BCS-leg, but it didn't materialize. Beautiful pullback from the RTL, classic! I'm going to leave my order in, just in case the RUT's flips the bull switch & heads back north. At this point, however, I think we'd need a sizable pop through the RTL for my order to trigger -- the spread has lost 66% of it's credit post-pullback. Given the continued adherence to the TLs, I still think that gap between the 20 + 50 DMAs is going to be where the battle is fought -- win or lose. The RUT could drift back into that zone this week, but eventually that zone is going to coincide with the STL, and that is when things could get interesting. Personally, I think the RUT will trade sideways, or in the channel, until that event occurs (the 20 + 50 DMAs drift through the STL). Could give the Bears a chance to apply some brakes & get the RUT back into it's traditional trading zone of 1220s - 1080s. So, hurry up & bet against that from happening! We'll see...
Looking at charts it feels like a one or two day big drop could be in the works. Not like I'm gonna sell longs but placed a quick bet on downside. Tight stop in place