Welcome Stockaholics to the trading week of November 9th! 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: What to Watch in the Week Ahead: Monday Earnings: McDonald’s, SoftBank, Beyond Meat, Simon Property Group, Ambac Financial, Tilray, ZoomInfo, Occidental Petroleum, Myriad Genetics, Taubman Centers, International Flavors and Fragrances, Norwegian Cruise, Canopy Growth, Aurora Cannabis, Party City 1:30 p.m. Cleveland Fed President Loretta Mester 5:00 p.m. Dallas Fed President Robert Kaplan 2:00 p.m. Senior loan officer survey Tuesday Earnings: Lyft, Advance Auto Parts, Adidas, D.R. Horton, Rockwell Automation, CyberArk Software, Hain Celestial, Rackspace, Ashland, Rocket Cos 6:00 a.m. NFIB small business survey 8:30 a.m. Dallas Fed’s Kaplan 10:00 a.m. JOLTS 10:00 a.m. Dallas Fed’s Kaplan 10:00 a.m. Boston Fed President Eric Rosengren 12:00 p.m. Dallas Fed’s Kaplan 2:00 p.m. Fe Vice Chairman Randal Quarles 5:00 p.m. Fed Governor Lael Brainard Wednesday Veterans Day Bond market closed, stocks market open regular trading hours Earnings: Air Products, DouYu, Lemonade, Reynolds Consumer, Vroom, Fossil Thursday Earnings: Walt Disney, Palantir Technologies, Applied Materials, Beazer Homes, Cisco Systems, Siemens, Burberry, Brookfield Asset Management, Unity Software 8:30 a.m. Jobless claims 8:30 a.m. CPI 9:30 a.m. Fed Chairman Jerome Powell at ECB forum on central banking 1:00 p.m. Chicago Fed President Charles Evans 2:00 p.m. Federal budget 2:00 p.m. New York Fed President John Williams Friday Earnings: Manchester United, Draftkings, Vipshop 7:00 a.m. New York Fed’s Williams 8:30 a.m. St. Louis Fed President James Bullard 8:30 a.m. PPI 10:00 a.m. Consumer sentiment
Stocks Soar To Best Election Week Since FDR, Gold Jumps, Dollar Dumps US equity markets roared higher this week (best week since April) as (monetary handouts) QE hopes replaced (fiscal handouts) blue-wave hopes. Nasdaq rallied a stunning 9.5% on the week (Small Caps and The Dow lagged - only managing to gain 7%!!)... This was the best election-Week performance for stocks since FDR was elected in 1932... And best election-week for gold since the end of the gold standard... All of which must mean... Value stocks were trounced relative to growth stocks after the election... Source: Bloomberg Gunmaker stocks soared as Biden's odds rose... Source: Bloomberg Banks were rebuffed as mega-tech soared... Source: Bloomberg Vol collapsed across every asset class... Source: Bloomberg But, VIX really plunged this week, smashing the term structure back into contango (interesting that hump remains around the Senate run-off)... Source: Bloomberg And the volatility options market looks to be leaning towards a similar outcome of calmness following the storm... Source: Bloomberg Despite stock gains, Treasury yields were lower on the week (even after today's rise) as Source: Bloomberg Intraweek, yields plunged on election night (after an initial spike). 30Y yields rose back to 1.60% today after bouncing off the 200DMA... Source: Bloomberg Interestingly, real yields surged this week... and so did gold... Source: Bloomberg The Dollar was up on the week into the election, and dumped after... Source: Bloomberg Crashing to its lowest since May 2018... Source: Bloomberg The Turkish Lira collapsed to yet another fresh record low against the dollar... Source: Bloomberg Cryptos had a big week with Ethereum outperforming, Bitcoin Cash lagged... Source: Bloomberg Source: Bloomberg A weaker dollar lifted all commodities this week... Source: Bloomberg With silver outperforming, back above $25... Gold futures pushed back above $1950... WTI traded up to $39 intraweek before rolling over today... And finally, what happens next? 1987 or 2009? Source: Bloomberg
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2020- S&P sectors for the past week-
Presidential Election Anticipation Is Keeping Us Waiting While we all anxiously await the final count and outcome of the U.S. Presidential Election, here are some possible scenarios for 2021. Our analysis here is based on historical market performance during the most likely political alignments for next year. We ran these likely scenarios through the Almanac database software to create this graph. We are either going to have the fifth year of a two-term republican president or a first year of a new democratic presidency. It appears the democrats will hold the house and the republicans will hold the senate, but that is not a forgone conclusion either. So we also examined both presidential outcomes with a democratic, republican and split congress. Our study uses the S&P 500 from 1949 to 2017. We start in 1949 because it is the first full 4-Year Presidential Stock Market Cycle since the end of WWII. The Twenty-Second Amendment that implemented presidential term limits for a max of two terms or eight years was ratified on February 27, 1951. Truman in 1949 was excluded as there was a no change of party in the White House. We gave Bush 41 the same treatment. Admittedly, there are limited data points; four each of fifth year republicans and first year democrats. Here’s what we found. A change in party with a new, first year democratic president came with democratic control of Congress and significantly higher performance for the S&P 500, averaging 10.6% with a median gain of 15.1% versus 7.0% for the average post-election year since 1949. Fifth year republican presidents in 1957 (Eisenhower) and 1973 (Nixon) had to work with democratically controlled Congresses and the market suffered significant losses. The market did well in Reagan’s fifth year with a split Congress – a testament to how “The Great Communicator” was able to work across the aisle with then Speaker of the House Tip O’Neill. Even with republican control of Congress under Bush 43’s fifth year, the market had a tough year with ongoing issues in Iraq, North Korea declaring it’s a nuclear power and the most active and second costliest hurricane season on record. Job Growth Continues as COVID-19 Cases Rise The US labor market shrugged off election uncertainty and continued to add jobs in October. Despite the waning effects of fiscal stimulus and rising COVID-19 cases, per the US Bureau of Labor Statistics, the US economy added 638,000 jobs, ahead of Bloomberg survey estimates calling for 580,000. The headline number was depressed by a 268,000 drop in government employment, including 147,000 temporary census workers. Meanwhile, the unemployment rate fell from 7.9% to 6.9% despite a rise in the labor force participation rate, a reversal of the dynamic we saw in September when unemployment fell while the labor force participation also declined. However, a troubling trend remains beneath the surface. As shown in the LPL Chart of the Day, the number of long-term unemployed—those out of work for 27 weeks or longer—continues to rise as a share of the total unemployed: “While the labor market has continued to show improvement, there are still many people out there who are having a hard time getting back to work,” noted LPL Chief Market Strategist Ryan Detrick. “With total jobs in the US around 10 million below pre-pandemic levels and rising COVID-19 cases, there’s a lot of room for improvement despite the declining unemployment rate.” COVID-19 cases in the United States have reached record highs with a weekly trend growth rate above 20%, according to the COVID Tracking Project. As the weather cools and more activity shifts indoors, additional restrictions to limit the spread of the virus could slow the fragile labor market recovery. In particular, much of the private sector gains in this month’s jobs report were in the services sector, where previous jobs reports had shown strength in goods-oriented industries. Many countries in Europe have reinstated restrictions or even gone as far as implementing new lockdowns. While we don’t expect lockdowns in the United States like we saw in March, restrictions on activity could limit future job gains. One Sentiment Survey Soars While Another Sinks Thu, Nov 5, 2020 In an earlier post, we discussed how bullish sentiment in the AAII survey has been on the rise, but looking at another weekly sentiment survey from Investors Intelligence, the opposite is true. The percentage of respondents reporting as bullish fell sharply this week, 7 percentage points, down to 53.6%. While a majority are still optimistic and that reading is in the middle of its range, that was the largest weekly decline since a 7.4 percentage point decline to 41.7% in the first week of March. Meanwhile, the percentage of newsletter writers that are "looking for a correction" rose sharply to 25.8% this week following last week's over 5% decline for the S&P 500. The Investors Intelligence survey has a long history dating back to 1963, and in all weeks in that time, only 5% (174 weeks) have seen bullish sentiment fall 5 percentage points or more while the percentage of respondents looking for a correction has risen at least 5 percentage points in the same week. In the chart below, we show the average performance of the S&P 500 following these past occurrences when there has not been another in the prior 3 months. The S&P 500 has frequently been higher over the following weeks and months, but there is a slight underperformance relative to all periods since 1963 when the survey begins. 2 Post-Election Charts You Need to See The election is over, but the questions are mounting. We don’t know who will be the next president as of Wednesday morning, but we do know that stocks tend to do well the final two months of an election year. “Once the uncertainty is over, stocks tend to rally in November and December, with November the best month of the year during an election year,” explained LPL Financial Chief Market Strategist Ryan Detrick. “Of course, 2020 isn’t like any other year, and we still could be a ways away from who the winner will be.” The LPL Chart of the Day shows that the S&P 500 Index tends to do very well the final two months of the year, especially during election years. The modern design of the S&P 500 stock index was first launched in 1957. Performance back to 1928 incorporates the performance of predecessor index, the S&P 90 One of the big takeaways so far from Tuesday night is that the Senate likely will stay Republican, meaning we may have a divided Congress. The chances of higher taxes and more regulation likely took a hit under this scenario. This could be a nice tailwind for stocks, as the S&P 500 historically has done quite well under a divided Congress, up more than 17% on average. Additionally, in years with a divided Congress, stocks have been higher the past 10 times, with 2020 potentially being the 11th in a row. This election is far from over, so stay tuned to LPL Research as we continue to monitor things! Emerging Markets Cheering a Potential Biden Win Thu, Nov 5, 2020 The US equity market has seen a massive rally in reaction to what is looking like a Biden victory over President Trump coupled with the Republican party maintianing its majority in the US Senate. None of these results are official at this point, so they are subject to change, but these are the most likely scenarios as of now. Outside of the US, emerging markets have also rallied. In just the last two days, the MSCI Emerging Market ETF (EEM) has rallied 5% and broken above resistance to new 52-week highs. If for no other reason then Biden's campaign slogan isn't America First, the rationale behind the rally makes some sense. The reaction of EEM in the aftermath of this election is very much different from what happened in 2016. Heading into the 2016 election, EEM had been trending higher, but pulled back in the days leading up to the election and broke its uptrend that had been in place since earlier in the year. Again, Trump's America First approach was understandably viewed as a headwind to emerging market equities. While the initial reaction of EEM to Trump's election was negative, that weakness didn't last long. The chart below shows the performance of EEM in the two months before and one year after the 2016 election. The gray box represents the same period shown in the chart above. Within days after breaking its uptrend after the 2016 election, EEM bounced back, rallied to its 50-DMA, tested its November low, and then in the early days of 2017 it was off to the races as EEM. In fact, even accounting for the post-Election Day declines, one year after the 2016 election, EEM was up 25% which was actually more than the 21% return for the S&P 500! The moral of the story here is that first reactions aren't always the right reactions, and as an investor it's not just imperative to know the environment you are operating in, but also when the tides are turning. Winners and Losers During Trump's Presidency Tue, Nov 3, 2020 With Election Day upon us, below we take a look at the biggest winners and losers across financial markets during the Trump Presidency from Election Day 2016 through today. First off, below is a chart of the market cap of the Russell 3,000 since Election Day 2000 which George W. Bush eventually won. The Russell 3,000 makes up more than 98% of the total US equity market cap, so it's a good gauge to use for measuring the overall change in market cap levels. The current market cap of the Russell 1000 is just north of $35 trillion, which is up $11.5 trillion since Election Day 2016. President Obama oversaw US market cap growth of $12.3 trillion over his two terms, while President Bush actually saw market cap decline by $4.1 trillion after his two terms. Below is a look at the total return of various asset classes since Election Day 2016 using key ETFs listed on US exchanges. The S&P 500 (SPY) is up 70.6% since Trump was elected, while the Nasdaq 100 (QQQ) more than doubled that at +144.3%. Of the broad index ETFs in the matrix, the Smallcap Value ETF (IJS) is up the least since Election Day 2016 at just +17.2%. Looking at US sector ETFs, the Energy sector (XLE) is a huge outlier with a decline of 48.3% since Trump was elected. Technology (XLK) and Consumer Discretionary (XLY) are up the most with gains of 154% and 97%, respectively. Along with Energy stocks, the oil (USO) and natural gas (UNG) ETFs have been more than cut in half since 11/8/16, while gold (GLD) is up 47% and silver is up 29.5%. Not every country has seen stock market gains since Trump was elected. As shown below, Mexico (EWW) is down 28.5%, Brazil (EWZ) is down 19.4%, Spain (EWP) is down 6.8%, and the UK (EWU) is just slightly in the red. The US (SPY) is up more than any other country with a gain of 70.6%, while China (ASHR) is up the second most at +51%. Whatever happened with the trade war certainly didn't hurt the US and China versus the rest of the world on a relative basis. Within the Russell 1,000 in its current form, there are nine stocks that are up 1,000% or more since Election Day 2016, with Enphase Energy (ENPH) at the top with a gain of 8,590%. Trade Desk (TTD) is up the second most at +2,448%, followed by Novocure (NVCR), SolarEdge Tech (SEDG), and Quidel (QDEL). Square (SQ) ranks sixth with a gain of 1,203%. Other notables on the list of big winners since Trump was elected include Etsy (ETSY), Teladoc (TDOC), Tesla (TSLA), NVIDIA (NVDA), Atlassian (TEAM), Boston Beer (SAM), and Lululemon (LULU). In terms of market cap gains for individual stocks, the numbers below are quite eye-popping. Apple (AAPL) has gained the most in market cap since Trump was elected with an increase of $1.257 trillion! Amazingly, both Amazon (AMZN) and Microsoft (MSFT) have added more than $1 trillion in market cap as well. Prior to the last few years, no company was even close to having a $1 trillion market cap, but at this point, AAPL, AMZN, and MSFT have gained that much in the last four years.
Here are the current major indices pullback/correction levels from ATHs as of week ending 11.6.20- Here is also the pullback/correction levels from current prices- Here are the current major indices rally levels from correction low as of week ending 11.6.20-
Stock Market Analysis Video for November 6th, 2020 Video from AlphaTrends ShadowTrader Video Weekly 11.8.20 Video from ShadowTrader (VIDEO NOT YET POSTED.)
Here are the most anticipated Earnings Releases for this upcoming trading week ahead. ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 11.9.20 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 11.9.20 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 11.10.20 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 11.10.20 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 11.11.20 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 11.11.20 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 11.12.20 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 11.12.20 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 11.13.20 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 11.13.20 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
And finally here is the most anticipated earnings calendar for this upcoming trading week ahead- ($PLUG $WKHS $CGC $DKNG $BYND $MCD $ACB $RKT $SPG $JMIA $NVAX $TLRY $NKLA $DDOG $CSCO $DHI $WIX $CARS $AMAT $DIS $INO $GRWG $NLS $AAP $DOYU $RNG $PRTS $NBEV $LMND $TGNA $WVE $EXPI $PRTY $ICPT $HUYA $GOGO $NCLH $OXY $PEIX $CYBR) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning November 9th, 2020 <-- click there to view!
NFLX down too. It's probably due to Pfizer saying their vaccine is 90% effective (last article headline I saw anyways, haven't read up on it yet). Investors thinking stay at home companies have less value if people go back to normal life.
So what are you guys doing today? Chasing those travel stocks a little bit or buying the dips on those stay at home stocks? I am doing a little bit of both actually
The S&P 500 stock index soared after Pfizer announced positive results from its early Covid-19 vaccine trials.
Industrials, staples and real estates seem to be doing well today Those tech stock that got hit hard yesterday are red again today but they seem to be bouncing back a little bit from the lows earlier today
