Here is the media take on the markets today. Stock market news live updates: Stocks stage comeback day after Powell hints at more aggressive rate hikes https://finance.yahoo.com/news/stock-market-news-live-updates-march-22-2022-223839138.html (BOLD is my opinion OR what I consider important content) "U.S. stocks rebounded to close firmly higher Tuesday as investors shrugged off hawkish remarks from Federal Reserve Chair Jerome Powell and continued to monitor the war in Ukraine. The S&P 500 rose 1.1% to 4,511.81, and Dow Jones Industrial Average jumped more than 250 points, or about 0.7%, to 34,807.86. The Nasdaq Composite was up nearly 2% to 14,108.82. The moves come on the back of a choppy session Monday that saw all three indexes cap last week's winning streak to close lower after Powell signaled the central bank was prepared to act more aggressively to rein in inflation. Meanwhile, the 10-year U.S. Treasury climbed to yield 2.372%. The Fed’s top leader reiterated in comments at the National Association for Business Economics Monday that policymakers will lean into higher short-term interest rates “as needed” to mitigate fast-rising price levels, with a goal of bringing inflation back down to an annual pace of about 2% while maintaining low unemployment. "We just experienced the first rate increase over which it promises to be many, many more," Research Affiliates CEO Chris Brightman told Yahoo Finance Live on Tuesday. "Whether there is a 50 bps or a 25 bps increase next is not the point so much as that we're going to see continued tightening all through this year and likely into at least the first half of 2023 — and where it stops, nobody knows, including the Fed." The tightening could bring the yield curve, the relationship between short- and long-term interest rates of fixed-income securities issued by the U.S. Treasury, closer to inverting, Brightman pointed out. An inverted yield curve, when the short-term rates exceed the long-term rates, has been a signal of a pending economic recession in the past. The Fed is "going to tighten until something breaks," Robert Schein, chief investment officer at Blanke Schein Wealth Management, told Yahoo Finance Live on Monday. “That’s either breaking the back of inflation or growth is going to slow.” Powell’s comments come just a week after investors met the central bank’s long-anticipated move to lift its benchmark Federal Funds Rate by 0.25% (to a target range of 0.25% to 0.50%) with temporary relief after the bump came in on par with what market participants had expected. Despite providing some clarity to traders who for months have waited for the Fed to take steps forward on tightening monetary conditions, geopolitical turmoil in Eastern Europe and its economic toll continue to muddy the bank's path ahead in fighting inflation. The Fed is also tasked with beginning quantitative tightening, or rolling assets off its nearly $9 trillion balance sheet. The CPI print is "not going to look kind," Allianz Investment Management's head of ETFs Johan Grahn told Yahoo Finance Live. "That will be the indicator that the Fed is going to hang their hat on." Elsewhere in markets, Tesla was in the spotlight on Tuesday as shares of the electric vehicle giant soared amid the opening of its Berlin Gigafactory and delivery of the first 30 Model Y cars made in Europe. Shares of Tesla were up 7.9% to $993.98 a piece, notching the biggest pop in three weeks. Russia’s war in Ukraine also continued to be front-and-center for investors. Kyiv has refused to surrender its heavily-attacked port city of Mariupol to Russian forces as the civilian death toll climbed. Energy and commodity prices spiked amid the latest developments on the crisis. Officials in both countries have sporadically signaled a possible negotiation but attempts at talks have so far proven unsuccessful. Ukrainian President Volodymyr Zelenskyy warned recently that if discussions with Vladimir Putin failed, it could mean the start of a third world war. 2:44 p.m. ET: Tesla gains on opening of Berlin Gigafactory, delivery of first Model Ys made in Europe Tesla (TSLA) delivered the first 30 Model Y electric vehicles made at its newly-opened Berlin Gigafactory, its first plant in Europe. Shares of Tesla were up 6.3% to $979.04 a piece as of 2:43 p.m. ET, notching the biggest pop in three weeks. The factory is expected to eventually produce 500,000 vehicles annually and employ 12,000 workers. The first Model Ys rolling off the new location will be the performance variant, costing 63,990 euros ($70,500) with a 514 km (320 miles) range. New orders from the plant start delivery in April, Tesla said. "We view the opening of Giga Berlin as one of the biggest strategic endeavors for Tesla over the last decade and should further vault its market share within Europe over the coming years as more consumers aggressively head down the EV path," Wedbush analyst Dan Ives said. "We cannot stress the production importance of Giga Berlin to the overall success of Tesla's footprint in Europe and globally." 1:55 p.m. ET: Meme-stock favorite GameStop stages biggest rally of 2022 Shares of GameStop (GME) surged as much as 29%, the most intraday since Aug. 24 amid an uptick in mentions of the meme stock on retail-focused platforms such as Reddit and Stocktwits. The video game retailer was on pace for its sixth straight gain, which would mark the longest winning streak since May, according to Bloomberg data. The stock is trading above its 50-day moving average — a level it has not closed above in nearly four months Meanwhile, short interest in the stock has surpassed 20% of float this week for the first time since June 2021, according to data from S3 Partners. 1:49 p.m. ET: French oil and gas giant TotalEnergies to exit Russian market French oil major TotalEnergies further self-sanctioned Russian crude and refined oil products, announcing it will terminate all long-term contracts with Russia as soon as possible, and not later than end of 2022. "Given the Worsening situation in Ukraine and the existence of alternative sources for supplying Europe, TotalEnergies has unilaterally decided to no longer enter into or renew contracts to purchase Russian oil and petroleum products, in order to halt all its purchases of Russian oil and petroleum products as soon as possible and by the end of 2022 the latest," the French multinational oil and gas company said Tuesday. The move comes following pressure on TotalEnergies after it stayed hanging onto its Russian investments during a mass exodus of western oil majors after Russia's invasion of Ukraine even though no sanctions have forced such divestments." MY COMMENT If things stay stable in Ukraine this week....I dont see much that can derail stocks this week other than.....fear itself. We are all set up for a nice week if we can just hang in there....psychologically. HAPPY DAYS ARE HERE AGAIN........yeah that's right......I am NOT superstitious about jinxing the markets.
The housing markets, mortgage rates, and the impact of rising mortgage rates are going to be big stories in the financial world going forward for the next year or two. Mortgage rates are surging faster than expected, prompting economists to lower their home sales forecasts https://www.cnbc.com/2022/03/22/mor...ists-to-lower-their-home-sales-forecasts.html (BOLD is my opinion OR what I consider important content) "Key Points The average rate on the popular 30-year fixed mortgage hit 4.72% on Tuesday, moving 26 basis points higher since just Friday, according to Mortgage News Daily. As a result of the recent spike in rates, economists are now lowering their home sales forecasts for this year. Most estimates at the end of last year had the average 30-year mortgage rate hitting 4.5% by the end of 2022, but the war in Ukraine, rising oil prices and inflation have all lit a fire under interest rates. The average rate on the popular 30-year fixed mortgage hit 4.72% on Tuesday, moving 26 basis points higher since just Friday, according to Mortgage News Daily. As a result of the recent spike in rates, economists are now lowering their home sales forecasts for this year. Most estimates at the end of last year had the average 30-year mortgage rate hitting 4.5% by the close of 2022, but the war in Ukraine, rising oil prices and inflation have all lit a fire under interest rates. At this time in 2021, rates were about 3.45% A shift in the policy outlook from the Federal Reserve, suggesting far more rate increases than expected, is pushing bond yields higher. The 30-year fixed mortgage loosely follows the yield on the 10-year U.S. Treasury, which is now at the highest level since May 2019. “Rates have a small chance to top out before hitting 5% and a good chance of topping out before hitting 6%,” said Matthew Graham, chief operating officer at Mortgage News Daily. “It is a rapidly moving target in this environment, where we legitimately and unexpectedly find ourselves needing to be concerned with inflation for the first time since the 1980s.” Economists had expected the rate to rise only slightly this year, but now that is changing. Lawrence Yun, chief economist for the National Association of Realtors, now says he expects the rate to hover around 4.5% this year, after previously predicting it would stay at 4%. NAR’s latest official prediction is for sales to drop 3% in 2022, but Yun now says he expects they will fall 6%-8% (NAR has not officially updated its forecast). The rise in rates comes on top of an already sizzling housing market. Demand remains strong, and supply remains historically low. This has pressured home prices, which were already up 19% in January year over year, the latest read from CoreLogic. “That is a double whammy that erodes affordability for homebuyers, especially first-timers,” said Frank Nothaft, chief economist at CoreLogic. “First-time buyers are a sizable part of prospective shoppers and their share of purchases has slipped from one year ago. We will be revising our home sales forecast a bit lower.” Home sellers may also be adjusting their expectations. Asking prices slipped slightly last week, according to Realtor.com, despite the competitive market. “In a potential sign that sellers are mindful of buyers’ tightening budgets as mortgage rates climb, last week’s data showed the first slowdown in asking price growth since January,” wrote Danielle Hale, chief economist at Realtor.com. Hale said she may revise her sales forecast lower as well but hasn’t yet. She points out that while rising costs could cut into home sales, there are several offsetting factors, such as rent. “Fast-rising rents aren’t offering any relief and may keep some would-be buyers on the hunt for a home, so that they can lock-in the bulk of their housing costs before inflation raises the bar yet again,” said Hale. “Demographics are also favorable for the housing market this year, with more than 45 million households in the 26-35 age range, which are key years for household formation and first-time home buying. However, the economic considerations for those households are going to be challenging,” she added." MY COMMENT EVERYTHING is interconnected.....rates, home values, the stock markets, bonds, etc, etc. Also......everything is interconnected when it comes to figuring net worth, consumer confidence, and the potential for a recession. As the FED tries to fight inflation......there will be many anticipated......and....unanticipated impacts of what they are doing.
I gained today but I was .5% or so less than the s&p. Lowes was down and abt didn't gain a ton. Klic was down too. Alk and googl was up nicely as was voo
Great to see oldmanram on board again. I’m away with wifey I’m Miami for the music week partying our asses off so won’t be able to brag on how great of comeback I’ve had in the markets in the past 9 days or so. Oops.. looks like I just did. Great to know your money is working for you EVEN in the stock market while you’re away on vacation
Well I dont like the open today.....so I will just IGNORE IT. I have that luxury since I am a.......long term fully invested all the tim....... investor.
Morning Guys, Have one for me Zukodany !!! I'm waiting around for some antenna's today, so thought I would check in. I was up pretty good yesterday about 1.5% , still way down for the YTD , about 6% , but that is about half of what I was down. But NO selling, or trading, like I said was on a buying benge the last couple weeks. So far today the only holding that is up is PM , overall down 1% , 7am pacific time
Since I am ignoring the markets at the moment....lets talk about dividends. Dividends Are Nice, but They Aren’t Safety Blankets High-dividend stocks’ reputation as a safe haven is a myth. https://www.fisherinvestments.com/e...dends-are-nice-but-they-arent-safety-blankets (BOLD is my opinion OR what I consider important content) "Editors’ Note: MarketMinder doesn’t make individual security recommendations. Those mentioned below merely represent a broader theme we wish to highlight." "Global stocks enjoyed a nice rally last week, but it hasn’t much calmed investors’ nerves. Headlines continue warning of worse to come, and there is a cottage industry in articles featuring investment tactics for uncertain times. One supposed tactic getting a lot of ink: dividends. This isn’t unusual. In our experience, interest in high dividends tends to spike whenever markets get rocky—largely because the dividend payments offer perceived stability. In our view, this is a short-sighted and flawed viewpoint. We like dividend stocks just fine, but they aren’t safe havens. Much of dividends’ allure during volatility stems from a fundamental misperception about what dividends are. You can hear it in sentiments like, stocks may be down, but at least these dividends get me a nice yield. Problem is, this statement presumes dividends are a return on your investment, which isn’t true. Dividends are a return of capital. Unless you reinvest them, they don’t add to returns. Yes, dividends are some companies’ way of returning earnings to shareholders. But companies pay those dividends in lieu of reinvesting earnings back into their core business to fund long-term growth. Every dividend payment peels off a small slice of the company’s value. Therefore, the company’s market cap—and stock price—drop by the amount of every dividend paid out. Or, more simply, companies pay dividends out of their stock prices. They are returning some of your principal back to you. This can seem like an abstract concept, so let us show a real-world example. In November 2012, Wynn Resorts paid a one-time $7.50 dividend. As Exhibit 1 shows, in the run-up to this event, Wynn’s price and total returns (that is, price plus reinvested dividends) were identical. But then came the ex. dividend date, which is the date you must have owned a stock in order to receive the dividend. It is called the “ex dividend” date because the stock price becomes exclusive of the dividend—or, in simpler terms, the dividend is subtracted from the stock price. Once Wynn’s stock went ex. dividend, its price return diverged from its total return by roughly the amount of the dividend paid. Exhibit 1: Wynn Resorts’ 2012 Special Dividend Source: FactSet, as of 5/5/2020. Wynn Resorts price and total returns, 9/28/2012 – 12/31/2012. This is why it is a mistake to liken stocks’ dividend yields to bonds’ interest payments. Interest is a return on your investment. You receive the interest payments over the bond’s lifespan and get your entire principal back when the bond matures. By contrast, dividends generate compound growth only if you reinvest them, which cuts against the emotional appeal of owning them during market downturns. Then too, companies often cut dividends when times get lean, zapping all trace of the alleged safety blanket. High-dividend stocks aren’t immune to bear markets, either. In 2020’s lockdown-induced bear market, the MSCI World High Dividend Yield Index fell -32.7%, which was only moderately less than the MSCI World Index’s -34.0% drop. In the bear market that accompanied 2007 – 2009’s global financial crisis, the MSCI World High Dividend Yield Index’s -63.4% drop was even worse than the MSCI World Index’s -57.8% fall.[ii] Dividends didn’t offer protection on either occasion. Again, we like dividends. We just think it is a mistake to target them, either for cash flow or for a performance boost when times get tough. Stocks are stocks, and performance depends on a host of variables—not least sector and country, along with a litany of company-specific attributes—not whether a company pays out some of its value now and then. " MY COMMENT I like dividends as an investor. But this little article is correct.....they are a return of a slice of a company........a capital asset....a bit of your investment. They are NOT interest. The way you get compounding with dividends is by reinvesting them. Personally if I own a company I ALWAYS reinvest any dividends. If I own a company as one of my 10-15 stocks it is because I believe in that company.....long term. Therefore.....I reinvest all dividends so every penny can participate in the lng term growth of the company.
As an observer of HUMAN BEHAVIOR I really like this little article. It is long so I will not post the whole thing......but.....it is very interesting reading. There are some good lessons in human behavior here. There is also much food for thought for anyone with an open mind here. How People Think https://www.collaborativefund.com/blog/think/ MY COMMENT Yep....eight billion people in the world translates into eight billion realities. A few of them will overlap somewhat due to some shared experiences or beliefs.
Since I BITCHED about Amazon for a long time on here over their refusal to split their stock and the damage that was doing to the share price and investors......I like this little article. Amazon Is Back to Acting Like a Wall Street Darling https://finance.yahoo.com/news/amazon-back-acting-wall-street-110117695.html (BOLD is my opinion OR what I consider important content) "(Bloomberg) -- After almost two years of lagging behind the likes of Apple Inc. and Alphabet Inc., Amazon.com Inc. is starting to behave more like one would expect from Wall Street’s favorite megacap stock. The shares have rallied 20% since hitting a 20-month low on March 8, the day before the e-commerce giant announced a stock split and buyback plan that sparked the turnaround. Amazon is now on the verge of turning positive in a year in which the Nasdaq 100 Index is still down 10%, making it the best-performing of the four largest U.S. technology companies in 2022. The recent rally is a welcome development for analysts, who have remained universally bullish as the shares labored. All 57 tracked by Bloomberg data have a buy or equivalent recommendation on the stock, with Goldman Sachs Group Inc. and Bank of America Corp. touting it as a top pick. Those predictions are now, perhaps, proving prescient: while Amazon is now down just 2% for the year, Alphabet has declined 4%, Apple has slumped 5% and Microsoft Corp. is 11% lower. To Daniel Morgan, a senior portfolio manager at Synovus Trust, Amazon’s recent gains have a lot to do with the stock split and buybacks -- which are clear signals the company is becoming more shareholder friendly. “The stock split was huge,” Morgan said in an interview. “It looks like some money is swinging back into Amazon because of that perceived shift.” The potential for returning more capital to shareholders was cited by Dan Loeb’s Third Point LLC, which said last month it significantly boosted its stake in the company. Loeb told investors in February that Amazon was undervalued to the tune of about $1 trillion due to the combination of its different e-commerce and web services businesses, according to the Wall Street Journal. Still Expensive Amazon’s rally comes as investors start to embrace higher-valuation stocks again, after months of shunning them in favor of cheaper ones in anticipation of Federal Reserve interest-rate hikes. Like the Nasdaq 100, the shares are still trading well off their high, down 12% from a July record. While Amazon is much cheaper than it once was, the stock is still priced at 44 times profits projected over the next 12 months, making it by far the most expensive of the megacaps. The average for the Nasdaq 100, by contrast, is 24 times, according to data compiled by Bloomberg. While the shares may be benefiting from the split and buybacks, Amazon’s businesses will need to continue performing well for the rally to last, according to Michael Casper, an equity strategist with Bloomberg Intelligence. “Those things tend to be a short-term boost and fundamental trends will ultimately carry the day,” Casper said." MY COMMENT This stock split is a good start for the company. They need to respect and be aware of their OWNERS......the shareholders. NOW......they need to prove that the new management can operate the company and make money. This split is a good first step. The refusal of management to even consider a stock split was a mistake. The high price for one share was OBVIOUSLY hurting the stock.....for years now. BUT....now moving forward.....it WILL be the fundamental business results that will determine the direction of the stock.....and..... if the current management can produce.
My BIG BUY......of additional TESLA shares yesterday.....4 shares.....is up nicely today. Here is the news that I consider important for the company going forward. Tesla's new Gigafactory is its biggest strategic endeavor in a decade: analyst https://finance.yahoo.com/news/tesl...c-endeavor-in-a-decade-analyst-101828892.html AND.....in conjunction with the above: Keep on Buying Tesla Stock, Says Analyst Ahead of ‘Master Plan Part 3’ https://finance.yahoo.com/news/keep-buying-tesla-stock-says-201537423.html
About the dividend article, one thing they did not mention , the chart does not show the price before that ex div rate , I have noticed , that a stock will run up in value to that ex div date. And there are some investors out there that will buy a stock just to get the dividend, then sell, once they are the owner on date of record.
Zukodany, looks like its a little windy down there , make sure to hold onto that umbrella in your cocktail. !! On an investing note: QQQ a stock I have owned for a long time , now has a little brother , QQQM It has a lower fee than QQQ (.15% compared to .20%) , supposedly for long term holders of the stock , I picked up some and put in my daughters accounts, just to follow it. It also seems to trade a couple hundredths different in price. There are a couple articles out there comparing the two for those interested. https://etfdb.com/tool/etf-comparison/QQQ-QQQM/#overview
That is good to know oldmanram about the QQQM. Over the long term those tiny differences in fees and expenses can really add up. Good post.
I am nearly....within $600.....of being green today.....as of a few minutes ago. AND....the NASDAQ has been flirting with green over the past hour or so. SO...there might be hope for the markets today....depending on what you own. I am out for a few hours and will simply ignore the markets till the close so I can be surprised.
GEEZZZ....I go out and come back after the close......and....someone broke the markets. Actually my account LOSS was not as bad as I expected....kind of medium level at worst. I did manage to beat the SP500 today by 0.12%. I will take that little victory.....since I have no choice.
This is the POWER of knowing what you are doing from years of experience.....and.....sticking with what you know works from decades of experience. Not to mention having a very LONG TERM approach and view of the markets. Opinion: How ‘washed up…old man’ Warren Buffett is getting the last laugh https://www.marketwatch.com/story/h...t-is-getting-the-last-laugh-11648055804?rss=1 (BOLD is my opinion OR what I consider important content) "Poor old Warren Buffett. Poor, old, “washed up” Warren Buffett! It’s almost two years since the Berkshire Hathaway chairman, then 89, was publicly mocked by 40-something self-proclaimed stock market “captain” and “winner,” Barstool Sports founder David Portnoy. “He’s old, he’s washed up,” Portnoy said about Buffett. “He’s an old man, his time passed him by.” “I’m better that he is. It’s no debate. I killed him. He’s dead. He’s dead,” Portnoy said. “I’m just printing money,” Portnoy said. “Why take profits when every airline goes up 20% everyday. Losers take profits. Winners push the chips to the middle. I should be up a billion dollars.” He added: “There’s nobody who can argue that Warren Buffett is better at the stock market than I am right now. I’m better than he is. That’s a fact.” Booyah! I was thinking of Portnoy’s comment recently, after stock in Buffett’s conglomerate Berkshire Hathaway zoomed past $500,000 a share for the first time in history. In the 21 months since Portnoy’s tweet, Berkshire Hathaway BRK.A, -0.77% stock has rocketed by 75%, beating the S&P 500 SPX, -1.23% by a clear 30 percentage points (all this year) and the riskier small cap Russell 2000 RUT, -1.73% by 40 points. We attempted to contact Portnoy and his company for comment but were not able to reach him. Maybe more to the point, simple math shows that Buffett, now 91, has personally made more money since Portnoy’s tweet than at any other time in his career. His net worth is up a staggering $56 billion since then, has broken $100 billion for the first time, and is at the time of this writing up to $126 billion. Not bad for someone who just announced another megadeal, one of his biggest ever. Celebrity Net Worth estimates Portnoy’s fortune at $80 million. Poor old Warren! Wow, did his time pass him by! There’s a simple lesson for all investors in this, and it’s about the value of compound interest once we are in the third stage of life. One of the reasons Buffett has been making by far the most money of his career in the past couple of years is because by this stage his accumulated stake is so large. So a 35% gain today will make him far more money in actual dollar terms than a 50% or even 100% gain would have done in the past. Such are the benefits of saving early and often. Meanwhile, it has been an almost infallible rule during my career as a financial journalist that you should just go out and buy stock in Berkshire Hathaway whenever people start to say that Buffett has passed his prime. I remember hearing much the same in early 2000, during the last dot-com bubble, when “old economy” Berkshire stock had nearly halved to around $40,000. And they were saying much the same in the fall of 2008, during the global financial crisis, when Buffett urged people to buy stocks and various people said he’d lost it. (Oh, and one of the many reasons why you should never, ever, ever take my advice is that I am so stupid I was willing to sell my Berkshire Hathaway stock — along with my Amazon AMZN, -0.90% stock and Diageo DEO, -1.17% stock — in 2006 to go work for Jim Cramer at TheStreet.com. Idiot, indeed. But I loved the job.) Now at $529,000, Berkshire Hathaway stock looks neither especially cheap nor expensive by its own historical standards. The conglomerate, which includes GEICO insurance, See’s Candies and multiple other businesses, currently trades at 1.5 times net asset or “book” value, which is pretty much average for the past 2 decades. If any other genius traders in their 40s (or younger) think Buffett is washed up at 91, maybe we shouldn’t tell them about his vice chairman and friend Charlie Munger, still going strong at…98." MY COMMENT This is the POWER of long term investing compared to short term momentum investing by chasing Meme stocks. In the end guess who wins by a massive amount? Why.....it is the old guy that is investing the old fashioned way that no one invests anymore. I cant tell you how many times I have heard this same stuff over the past 45+ years of investing the......old way.....with my simple, big cap stocks, that I simply hold for the long term. The bottom line......things may change....things may move on....but......in the end....the old ways of investing are STILL the BEST. Of course another secret is......over my life most investors I have known did NOT invest the "old way". That is why most of them are still working in a job and dont have anywhere near the returns of the simple SP500 to show for their lifetime of investing.
