Welcome Stockaholics to the trading week of July 15th! This past week saw the following moves in the S&P: Major Indices End of Week: Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday Earnings: Citigroup, Wintrust Financial, J.B. Hunt 8:30 a.m. Empire state survey 8:50 a.m. New York Fed President John Williams Tuesday Earnings: Goldman Sachs, J.P. Morgan, Wells Fargo, Johnson & Johnson, Charles Schwab, Domino’s Pizza, CSX, United Airlines, First Republic Bank, First Horizon, Commerce Bancshares, Canadian Pacific Railway 8:15 a.m. Fed Governor Michelle Bowman 8:30 a.m. Retail sales 8:30 a.m. Import prices 8:30 a.m. Business leaders survey 9:15 a.m. Industrial production 10:00 a.m. Business inventories 10:00 a.m. NAHB 12:20 p.m. Dallas Fed President Richard Kaplan 1:00 p.m. Fed Chair Jerome Powell speaks on post-crisis monetary policy at Banque de France conference, Paris 2:30 p.m. Chicago Fed President Charles Evans 4:00 p.m. TIC data Wednesday Earnings: Bank of America, US Bancorp, Bank of NY Mellon, Abbott Labs,IBM, Netflix, Adtran, BancorpSouth, Textron, Alcoa, Texas Capital Bancshares, Crown Castle, United Rentals, PNC Financial Services, eBay 8:30 a.m. Housing starts 2:00 p.m. Beige book Thursday Earnings: Microsoft, Morgan Stanley, Novartis, Union Pacific, Capital One, Intuitive Surgical UnitedHealth, Blackstone, SunTrust, BB&T, Sun Trust, M&T Bank, Honeywell, Danaher, Capital One, ETrade, Intuitive Surgical 8:30 a.m. Initial claims 8:30 a.m. Philadelphia Fed survey 2:15 p.m. New York Fed’s Williams Friday Earnings: American Express, BlackRock, State Street, Autoliv, Schlumberger, Synchrony Financial, Cleveland-Cliffs, Gentex 10:00 a.m. Consumer sentiment 4:30 p.m. Boston Fed President Eric Rosengren
Stocks Surge To Record Highs As Payrolls & Powell Spark Bond Bloodbath Chinese, European, and US Small caps all lost ground on the week... could be worse though, you could be a bond or bund-holder... Chinese stocks ended the week lower but the losses were all on Monday... Hang Seng's China index tumbled into a death-cross... Oncologists Are Freaking Out After True Cause of Cancer Is Released[/paste:font] Oncologists Are Freaking Out After True Cause of Cancer Is Released Sponsored By: NHS News Only Italy managed gains on the week in Europe with Germany's DAX tumbling... And while German stocks tumbled, German bunds collapsed (worst yielding spike since June 2017)... Even Small Caps ramped into the green for the week today, but ended red. The Dow and Nasdaq led the week though... The Dow, Nasdaq, and S&P all closing at the high of the day and at record highs... S&P gapped open above 3000 and held for the first close above that level... Not a meltup... Cyclical stocks melted up today, outperforming defensives that had dominated the week until then... S&P Tech Sector topped 20x Fwd P/E today - its highest since Nov 2007... JNJ tumbled on DoJ criminal probe headlines.. For the first time in 7 weeks, the aggregate return from holding the long-bond and the S&P was negative... Credit and equity protection costs diverged notably the last few days as VIX collapsed to a 12 handle and credit spreads widened... Treasury yields exploded higher this week (except 2Y) and including the Friday spike from payrolls, 30Y is up almost 18bps... With 30Y spiking up to 7-week highs... The yield curve steepened dramatically this week... But we note that each time the 3m10Y curve tried to get back above zero (un-invert), it failed... The dollar is down 3 days in a row to end the week (post-Powell) after surging post-Payrolls... Meanwhile, FX vols have collapsed. USDJPY im;lied vol is at a record low... So much for surging economic policy uncertainty Cryptos were mixed this week with Bitcoin gaining over 5% and the rest of the larger alt-coins losing ground... (but rallying on the day after Trump's comments) Big gains for commodities this week with oil prices up large and silver very modestly outperforming gold... WTI ended the week back above $60 but hit a wall of resistance at the longer term downtrend... Gold held above $1400 on the week but has gone nowhere for almost a month... Finally, we offer the following from BofA: "...we anticipate an "overshoot" in credit & equity prices in coming months, followed by an overshoot in gold (US$ devaluation) before big H2 top in asset prices (as bond bubble pops & policy impotence visible)." And then?
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2019- S&P sectors for the past week-
Earnings Off-Season Stats Fri, Jul 12, 2019 Earnings season encompasses a period of roughly six weeks every three months when the large majority of publicly traded companies report their quarterly numbers. The unofficial start to earnings season used to occur when Alcoa (AA) -- a former Dow 30 stock -- posted its quarterly numbers, as it was always the first big blue chip to report. In 2017, however, Alcoa (after spinning off part of the company) pushed back its quarterly earnings report date by a couple of weeks, so now we consider the unofficial start to earnings season to be when the first of the big Wall Street firms reports each quarter. This quarter, the start to earnings season will be on Monday, July 15th when Citigroup (C) reports. Click here to see our list of the most volatile stocks on earnings. Wal-Mart's (WMT) quarterly earnings report marks the unofficial end to earnings season. The Q1 2019 earnings reporting period ended when WMT reported back on May 16th. Below we wanted to check up on how things went during the most recent earnings offseason. While the number of reports per day drops dramatically during the earnings offseason, there's still a slow trickle of reports. Bespoke subscribers have access to our Earnings Explorer tool that keeps investors on top of the important macro and micro trends related to earnings. Users can easily pull up historical quarterly reports for every US stock going back to 2001, and there's a healthy amount of summary analysis as well. Below is a snapshot of the tool where we have pulled up all of the stocks that have reported since last earnings season ended on May 16th. A total of 276 companies have reported earnings since May 16th. Sixty-eight percent of these companies reported better than expected EPS numbers, while 62% reported better than expected sales. In terms of guidance, only 8% of companies raised guidance while 13% lowered guidance. This means there was a guidance spread of -5 during the most recent earnings offseason. In terms of price reaction to earnings, the average stock that has reported since May 16th has fallen 0.56% on its first trading day following its report. This negative price action from individual stocks in response to earnings is a divergence from the S&P 500's gain of more than 4% during this offseason. At the bottom of the snapshot, we show the stocks that performed best on their earnings reaction days this offseason. (Users of the tool see an interactive list of all 276 stocks that have reported along with their price action.) As shown, OMN was the best performing stock on earnings this offseason with a one-day gain of 54.36% on July 3rd. CDMO, CIEN, and DY all gained more than 25% on their earnings reaction days as well. If you haven't used it yet, we urge you to try out our Earnings Explorer now. Earnings Season vs Earnings Off Season Fri, Jul 12, 2019 Earnings season is upon us. Historically, we used Alcoa (AA) reporting as the unofficial start of earnings season, but since that company broke into two tickers we've switched to the first report among the large money center banks. On Monday, that will be Citi (C). We gauge the report for Wal-Mart (WMT) as the unofficial end of earnings season. Since WMT's most recent report, the S&P 500 is up about 4.3%. What does that tell us about forthcoming performance during earnings season? As shown in the chart below, not much. Since 2001, stocks tend to perform best over earnings season when they're either down modestly or up modestly in the prior off season. Very large or very small off season changes in stock prices tend to lead to the worst earnings season performance, while modest gains or losses in the off season lead to the biggest average gains. It's worth saying that if we don't break up the performance into bins as we do in the chart above, the relationship between off season performance and earnings season performance is almost literally zero. While the 4.3% performance into earnings season this year suggests modest gains across earnings season, the broader data set doesn't tell us much about where the stock market is set to go over the next six weeks. The Bespoke Report - The Calm Before the Storm Fri, Jul 12, 2019 With little in the way of major economic data and earnings season still a week away, the only major item of this past week was the deluge of Fed officials hitting the tape, including Chairman Powell’s testimony to the House and Senate on Wednesday and Thursday. With the overall calm and Powell’s soothing words, bulls were in charge and took charge sending the major US large-cap indices to record highs. After numerous attempts to get through the 2,950 level, the S&P 500 finally broke out and hasn’t looked back since. With the S&P 500 up 20% on the year and earnings season coming up on the horizon where does the market stand and have we moved too far to fast? Country Stock Markets See Downside Mean Reversion Fri, Jul 12, 2019 Yesterday we highlighted the year-to-date performance of stock markets for 75 countries around the world. Below is a snapshot of how 23 of the largest countries have been performing more recently relative to their normal trading ranges. While Brazil (EWZ) is up 6% and the US (SPY) is up slightly over the last 5 trading days, most countries are actually in the red. Given how extended a lot of countries were last week at this time, the action we've seen since then can be categorized as simple downside mean reversion. While nearly all of these country ETFs are above their 50-day moving averages, there are three countries that have moved below -- South Korea (EWY), Mexico (EWW), and India (PIN). India has shown the most weakness over the last week with a decline of more than 3%, leaving it 1% below its 50-DMA. As mentioned earlier, Brazil (EWZ) has seen a huge move higher gaining 6% over the last week. The ETF is now 12% above its 50-day moving average, but remarkably, it's still not even two standard deviations above its 50-DMA because of the big volatility the ETF typically experiences. 2019 Country Stock Market Returns Thu, Jul 11, 2019 Below is a look at the year-to-date returns (in local currency) of stock markets for 75 countries around the world. The average country has posted a gain of 8.94% year-to-date, and 59 of the 75 countries (79%) are in the green. Argentina and Greece have posted the biggest YTD gains at this point with moves of 40%+. Russia ranks third with a gain of 30.89%, followed by Jamaica (+26.79%), Romania (+22.22%), and New Zealand (21.29%). The United States has been the 8th biggest winner this year with a gain of 19.68%. Notice that six of the seven G7 countries are roughly in the top third, which means developed countries have been doing very well this year. Japan is the biggest laggard of the G7 countries, but it's hard to be too disappointed with its YTD gain of 8.14%. Three of the four BRIC countries rank in the top fourteen, led by Russia at +30.89%. Brazil ranks second of the BRICs with a YTD gain of 19.58%, while China is up 17%. India ranks last of the BRICs at +7.64%. Lebanon and Oman have been the two worst-performing countries this year with declines of just over 10%. Nigeria, Pakistan, and Sri Lanka are all down more than 8%, while Kenya is down just over 5%. The remaining countries in the red are only down slightly. Will The Fed Cut With Stocks At New Highs? “Don’t fight the Fed.” — Marty Zwieg After Federal Reserve (Fed) Chair Jerome Powell’s congressional testimony this week, it appears at least a 25 basis point (.25%) cut is in the cards on July 31. This would be the first rate cut since 2008, and it would come after nine consecutive 25 basis point hikes beginning in December 2015. We continue to expect a 25 basis point cut and don’t anticipate a 50 basis point (.50%) cut, as we discussed in more detail in The Deep Rate Cut Debate. However, the bigger questions are: What does a rate cut mean? And can it even happen with stocks at new highs? “Is it even possible for the Fed to cut rates with stocks near all-time highs?” asked LPL Research Senior Market Strategist Ryan Detrick. “As it turns out, since 1980, the Fed has cut rates 17 times when the S&P 500 Index was within 2% of a new high—and stocks were higher a year later every single time.” As our LPL Chart of the Day shows, Can The Fed Cut Rates With Stocks At New Highs?, rate cut with stocks near all-time highs has had extremely bullish results going out a year. Of course, we don’t know where stocks will be at the end of this month when a cut would likely take place, but the bottom line is that it isn’t impossible to have a cut when the S&P 500 is near highs, and if it happens, history shows us the bull could have a few more tricks up his sleeves. July options expiration day and week not so hot Since 1982, the Friday of options expiration week has a bearish bias for DJIA declining 20 times in 37 years with two unchanged years, 1991 and 1995. On Friday the average loss is a significant 0.28% for DJIA and 0.30% for S&P 500. NASDAQ’s record is even weaker, down 23 of 37 years with an average loss of 0.44%. DJIA posts the best full-week performance, up 23 of 37 with an average 0.39% gain. The week after options expiration also leans bearish for S&P 500 and NASDAQ over the longer-term with average losses. In recent years the track record had been improving until 2015’s across the board, greater than 2% loss. S&P 500 has Slipped in 7 of Last 9 Pre-Election Year July Second Halves Selling the September S&P 500 futures contract on or about July 15 and holding until on or about July 24 has a 56.8% success rate registering 21 wins against 16 losses in the last 37 years. The best win was $19,150 in 2002, and the worst loss was in 2009, posting a $12,650 bereavement. This trade had been successful in 13 of 15 years from 1990 to 2004. Since then it has nearly the opposite record, posting losses in 11 of 14 years from 2005-2018. However, in the last nine pre-election years this trade has been successful seven times. Losses were registered in 1983 and in 2011. In 2011, a longer holding period would have allowed the trade to turn profitable as S&P 500 dropped 16.8% from July 22, 2011 through August 8, 2011. This year the setup is compelling as S&P 500 is struggling to breakout above 3000. Growth and earnings are slowing while the race for the White House in 2020 is beginning to heat up. Rate cut enthusiasm could also fade as quickly as it materialized. Typical July Trading: Strength Early, Weakness After Mid-Month July is usually the best month of the third quarter and this July got off to a solid start with market gains during its first three trading days. However, the day after July 4th was tepid and weakness has persisted to start this week. Weakness after the 4th is not uncommon and it generally does not stick around for long. In the chart above you can see the average performance of DJIA, S&P 500, NASDAQ, Russell 1000 and 2000 over the most recent 21-year timeframe. This chart suggests the market is likely to resume its trend higher soon and it will likely persist through mid-month before the market takes another pause. NASDAQ’s Christmas in July Rally Ends Soon Toward the end of June we primed you for NASDAQ’s 12-day Midyear Rally, what we like to call a little Christmas in July for the market. Two days later we reminded you that this NASDAQ Christmas in July rally was looking for support at the June 25 close of 7885, which remains just a hair above the 50-day moving average. Well, NAS sure found support and has already delivered its usual gifts for a 3.3% gain so far over the last 9 trading days with just 3 days left in this annual tech rally. Now that NAS has weathered a couple of days of selling, it looks poised to make another run at new highs. But, if seasonality holds sway (as it has mostly this year) and the news flow from the Fed, Congress, the Trump administration, the Democratic candidates, tariffs, immigration and geopolitics remains volatile, the market is likely to hit the summer market volume doldrums on cue in the second half of July, setting up a pullback from the recent highs. Support at 7333 at the March/June low is likely to come into play, which would be about a 10%. There is also some technical support below that around 7000, but let’s not get ahead of ourselves just yet. We are still positioned for more sideways action and backing and filling over the next few months, so we don’t expect a big summer rally and use any further strength this week to shore up your portfolio for the usual summer swoon.
Here are the current major indices pullback/correction levels from ATHs as of week ending 7.12.19- Here is also the pullback/correction levels from current prices- ...and here are the rally levels from current prices-
Stockaholics come join us on our stock market competitions for this upcoming trading week ahead!- ======================================================================================================== Stockaholics Daily Stock Pick Challenge & SPX Sentiment Poll for Monday (7/15) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (7/15-7/19) <-- click there to cast your weekly market vote and stock picks! Stockaholics Weekly T/A Charting Challenge (7/15-7/19) <-- click there to participate! ======================================================================================================== It would be pretty sweet to see some of you join us and participate on these! I hope you all have a fantastic weekend ahead!
Stock Market Analysis Video for July 12th, 2019 Video from AlphaTrends Brian Shannon (VIDEO NOT YET UP!) ShadowTrader Video Weekly 7.14.19 Video from ShadowTrader Peter Reznicek (VIDEO NOT YET UP!)
Here is a look at this upcoming week's Global Economic & Policy Calendar- (GLOBAL ECONOMIC AND POLICY CALENDAR NOT YET UP!)
Here are the most anticipated Earnings Releases for this upcoming trading week ahead. ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 7.15.19 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 7.15.19 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 7.16.19 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 7.16.19 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 7.17.19 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 7.17.19 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 7.18.19 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 7.18.19 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 7.19.19 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 7.19.19 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
And finally here is the most anticipated earnings calendar for this upcoming trading week ahead- ($NFLX $MSFT $C $JPM $BAC $UNH $JNJ $MFC $DPZ $GS $CLF $PIXY $PGR $SCHW $ABT $CP $CSX $UAL $EBAY $ERIC $PLD $ISRG $JBHT $IBM $BX $SNV $AXP $PNC $SLB $AA $FRC $HON $KMI $MS $BK $ALLY $PM $URI $USB $FHN $UNP $TXT $CBSH $SKX $CTAS) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning July 15th, 2019 <-- click there to view!
Boeing ditches 737 Max name on new Ryanair plane Before and after images showed the model name "737 Max" had been replaced with "737-8200" source: https://www.bbc.com/news/business-48995509
Market hit another intraday ATH before pulling back, let’s see if earnings will push the market further higher into the ATH
Pretty typical midsummer day. Summer doldrums now in full swing. I think you and I both agreed @stock1234 that things could really begin to slow down as far as the news flow, market moves, etc. once we’re through the thick of earnings season. My hunch is the market will probably continue to drift higher into the end of the summer absent a black swan, trump tweet, or fed suddenly turning hawkish. Seems like as long as the economic data doesn’t just completely fall out of bed, and the fed keeps its pedal to the metal on its dovish tone, should be steady as she goes. {insert snore fest emoji here!}
