Welcome Stockaholics to the trading week of June 11th! This past week saw the following moves in the S&P: Major Indices End of Week: Bird's Eye view of the Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday 11:30 a.m. $32 billion 3-year auction 1:00 p.m. $22 billion 10-year auction Tuesday First day of FOMC meeting 6:00 a.m. NFIB small business survey 8:30 a.m. CPI 1:00 p.m. $14 billion 30-year auction 2:00 p.m. Federal budget Wednesday 7:00 a.m. Mortgage applications 8:30 a.m. PPI 2:00 p.m. Fed decision 2:30 p.m. Fed Chair Jerome Powell briefing Thursday 7:30 a.m. ECB decision 8:30 a.m. ECB President Mario Draghi briefing 8:30 a.m. Jobless claims 8:30 a.m. Retail sales 8:30 a.m. Import prices 10:00 a.m. Business inventories Friday 8:30 a.m. Empire state manufacturing 9:15 a.m. Industrial production 10:00 a.m. University of Michigan consumer sentiment 4:00 p.m. TIC data
Thanks To Biggest Short Squeeze In 4 Months, US Stocks Shrug Off EM, EU Entropy Markets move robotically higher, US creates fasteresterest super-computer ever-ever, Tudor's AI fund outperforms humans dramatically, Durant shows cyborgian features... It's here... It's all green, all the way baby... VIX tried its best to get back below 12... Growth dominated value to start the week then factors reversed rapidly on Thursday morning as value dominated growth to end marginally higher on the week... Wondering why stocks soared seemingly unstoppably this week, no matter what was thrown at them? Simple - it was the biggest short squeeze week in four months... In fact, since the start of April, "Most Shorted" stocks have dramatically outperformed the S&P... FANG stocks outperformed financials on the week but the last 3 days financials were the big winners... But as US bank soared, Italian banks... did not... Massive divergence occurring between US equity risk, IG risk, and HY risk... And while US debt markets' saw a yield flash-crash which left them marginally higher on the week... The biggest story of the week - which CNBC et al. barely even mentioned - was the huge liquidity suck out in US Treasuries on Thursday... 10Y Yields remained below 3.00% ... The yield curve ended practically flat on the week... Emerging Market debt tumbled back near its lowest since Feb 2016... after a brief dead cat bounce last week... But US HY credit markets rebounded notably, even as Emerging Markets plunged... The Dollar Index fell on the week for the first time in two months - though the trend is undeniably flat for the last 17 days...(1168, 1170, 1169, 1168, 1169, 1168, 1171, 1173, 1177, 1170, 1171, 1172, 1171, 1172, 1170, 1170, 1170...) EM FX was ugly broadly speaking but as the Argentine Peso plunged today so the Brazilian Real resurged miraculously... And in case you wondered - *BRAZIL TREASURY ACTS TO CURB VOLATILITY, NOT FIX PRICES:ALMEIDA Cryptos ended the week in the green with Bitcoin Cash outperforming and Litecoin the laggard... Even with the dollar marginally lower, oil still underperformed, as copper soared on supply scares... Silver notably outperformed gold on the week...back to almost unchanged on the year... But $1300 remains bid for the yellow metal... Once again, just as reality was about to dawn, soft data surveys took off again this week (as hard data faded)... Finally - today was all about the G6+1...ish I miss the costumes. I want costumes. pic.twitter.com/dTNWuiLucu 2:30 PM - Jun 8, 2018
Spoiler: Weekend Reading: Social Insecurity Authored by Lance Roberts via RealInvestmentAdvice.com, Last year, I penned an article discussing the primary problems with Social Security. To wit: “According to the June 2017 snapshot from the Social Security Administration, nearly 61.5 million people were receiving a monthly benefit check, of which 68.2% were retired workers. Of these 41.9 million retirees, more than 60% count on their Social Security to be a primary source of income. Of course, that dependency ratio is directly tied to financial insolvency of the vast majority of Americans. According to a Legg Mason Investment Survey, US baby boomers have on average $263,000 saved in defined contribution plans. But that figure is less than half of the $658,000 they say they will need to retire. As noted by GoBankingRates, more than half of Americans will retire broke.” “This is a huge problem that will not only impact boomers in retirement, but also the economy and the financial markets. It also demonstrates just how important Social Security is for current and future generations of seniors. Of course, the problem is that according to the latest Social Security Board of Trustees report issued last month, those benefits could be slashed for current and future retirees by up to 23% in 2034 should Congress fail to act. Unfortunately, given the current partisan divide in Congress, who have been at war with each other since the financial crisis, there is seemingly little ability to reach any agreement on how to put Social Security on sound footing. This puts those “baby boomers,” 78 million Americans born between 1946 and 1964 who started retiring last year, at potential risk in their retirement years. While the Trustees report predicts that asset reserves could touch $3 trillion by 2022, implying the program is expected to remain cash flow positive through 2021, beginning in 2022, and each year thereafter through 2091, Social Security will be paying out more in benefits than it’s generating in revenue, resulting in a $12.5 trillion cash shortfall between 2034 and 2091. That is a problem that can’t be fixed without internal reforms to the pension fund due specifically to two factors: demographics and structural unemployment.” I was reminded of this discussion by a recent note from the Committee For A Responsible Federal Budget which updated the rather dire situation of the Social Security system. “The Trustees for Social Security released their annual report today. As they have for many years, their projections show that the Social Security program faces a large and growing funding imbalance that must be addressed promptly to prevent across-the-board benefit cuts or abrupt changes in tax or benefit levels. This year’s report shows: Social Security Will Run Permanent Deficits. For the first time since 1982, the program will spend more than it raises in revenue and collects in interest. The gap will total $900 billion over a decade. On a cash-flow basis, Social Security will run a deficit of $85 billion this year and $1.7 trillion over the next decade. Social Security Faces Large Long-Term Imbalances. The Trustees estimate Social Security faces a 75-year shortfall of 2.84 percent of payroll (1.0 percent of GDP), growing to 4.32 percent of payroll (1.5 percent of GDP) by 2092. That means payroll taxes will need to be increased by 22 percent or scheduled benefits cut by a sixth (or some combination) to ensure 75-year solvency; ultimately, taxes will need to be increased by a third or benefits reduced by 26 percent. Social Security Will Be Insolvent by 2034. The Trustees project depletion of the Disability Insurance trust fund by 2032 and the Old-Age & Survivors Insurance trust fund by 2034. On a theoretical combined basis, the trust funds will run out by 2034 – the same as last year’s projections. At the time of insolvency, all beneficiaries will face a 21 percent across-the-board benefit cut. The Problem Is Similar To Last Year, But Has Deteriorated This Decade. Social Security’s 75-year shortfall rose from 1.92 percent of payroll in 2010 to 2.83 percent last year and 2.84 percent this year. The 2034 insolvency date is the same as projected last year, but three years earlier than projected in 2010. Lawmakers Should Start Making Changes Now. Social Security insolvency is not that far away – when today’s 51-year-olds reach the normal retirement age and today’s youngest retirees turn 78. Waiting 16 years to act would mean any tax hikes or benefit cuts have to be 35 to 40 percent larger. Protecting Social Security’s solvency is vitally important for the country’s overall fiscal outlook and the 86 million beneficiaries who will be on the program when the trust funds are exhausted in 2034. Swift action is needed to prevent seniors, surviving dependents, and people with disabilities from facing abrupt cuts in just a few years.” Here are the only two charts you need to see to understand the overarching problem. As stated above, the biggest problem for Social Security is that it has already begun to pay out more in benefits than it receives in taxes. As the cash surplus is depleted, which is primarily government I.O.U.’s, Social Security will not be able to pay full benefits from its tax revenues alone. It will then need to consume ever-growing amounts of general revenue dollars to meet its obligations–money that now pays for everything from environmental programs to highway construction to defense. Eventually, either benefits will have to be slashed or the rest of the government will have to shrink to accommodate the “welfare state.” It is highly unlikely the latter will happen. Demographic trends are fairly easy to forecast and predict. Each year from now until 2025, we will see successive rounds of boomers reach the 62-year-old threshold. There are several problems that no one wants to address: Each boomer has not produced enough children to replace themselves which leads to a decline in the number of taxpaying workers. It takes about 25 years to grow a new taxpayer. We can estimate, with surprising accuracy, how many people born in a particular year will live to reach retirement. The retirees of 2070 were all born in 2003, and we can see and count them today. In 1950, each retiree’s benefit was divided among 16 workers. Today, that number has dropped to 3-workers per retiree, and by 2025, it will reach–and remain at–about two workers per retiree. In other words, each married couple will have to pay, along with their own family’s expenses, Social Security retirement benefits for one retiree. In 1966, each employee shouldered $555 dollars of social benefits. Today, each employee has to support roughly $18,000 of benefits. The trend is obviously unsustainable unless wages or employment begins to increase dramatically and based on current trends that seems highly unlikely. The entire social support framework faces an inevitable conclusion where no amount of wishful thinking will change that outcome. The ONLY question is whether our elected leaders will start making the changes necessary sooner, while they can be done by choice, or later, when they are forced upon us. Just something to think about as you catch up on your weekend reading list. Economy & Fed Analysis Of The 2018 Social Security Trustees’ Report by CRFB G7 United Against Trump’s Trade War by Caroline Baum via MarketWatch Who Deserves Credit For “Roaring Economy?” by Robert Samuelson via IBD If Economy Is So Great, Why Are 78 Million Working Gigs by Rex Nutting via MarketWatch The Dirty Secret Behind The GOP Push For Deregulation by Pedro Da Costa via BI What Bush Tax Cuts Can Teach Us About Trump’s by Jerry Bowyer via Vident Financial Really, How Was That Employment Report by Macromon via Global Macro Monitor Employment Below 4% – Uh Oh! by Brian Maher via The Daily Reckoning POTUS Employs “Whack A Mole” Trade Tactics by Patrick Hill via The Progressive Ensign Unemployment At 50-Year Lows by Raul Elizalde via Forbes Why Are There More Jobs Than Unemployed Workers by Tyler Durden via Zerohedge Recession Is Coming & The Fed Can’t Stop It by James Rickards via Daily Reckoning Krugman And Keynes Are Wrong About Debt by Bart Remes via FEE Markets Dalio: We Are Bearish On Almost All Financial Assets by Tyler Durden via ZeroHedge Efficient Markets, Not So Much by Kevin Muir via The Macro Tourist Bull Rebuttal by Sven Henrich via NorthmanTrader.com Emerging Markets Have A Dollar Problem by Simon Constable via WSJ Income Investing That Avoids Rising Rate Risk by Paul Katzeff via IBD Are Winds Shifting Back To Bond Bulls Favor? by Dana Lyons via The Lyons Share The Next Junk Bond Crash Will Be Really Bad by Jonathon Rochford via MarketWatch Everything Is Fine, Until It Isn’t by Sam Potter & Tracy Alloway via Bloomberg Why Have Oil Markets Turned So Bearish? by Tsvetana Paraskova via OilPrice.com A Dozen Ways To Make Money From Investing by Brett Arends via MarketWatch More Stormy Weather Ahead For Stocks by Howard Gold via MarketWatch 1969 Can Tell Us A Lot About A Key Recession Indicator by Jeffrey Rosenberg via Blackrock Blog Most Read On RIA The Myth Of Buy And Hold Investing – Part I by Lance Roberts via Business Insider Our Two Cents On The Dollar by Michael Lebowitz The Coming Collision Of Debt & Rates by Lance Roberts 4-Mistakes In Your Financial Plan by Richard Rosso Kass: An Italian Job? by Doug Kass Research / Interesting Reads Huge New Prop Under Stocks Is A One-Time Affair by Wolf Richter via Wolf Street Are We On The Verge Of Another Debt Crisis by Martha White via NBC No Savings, Imprisoned & Homeless via Upfina Moves Retirees Should Make Before Retiring by Maurie Backman via Motley Fool The Hallmark Of An Economic Ponzi Scheme by John Hussman via Hussman Funds Psychology Of Money – 20 Things To Know by Morgan Housel via Collaborative Fund Rewarding Failure Is Now An Epidemic by Bethany Mandel via New York Post Time To Worry? by John Cochrane via The Grumpy Economist Robot Revolution Has Only Begun by Sanjit Dang via TechCrunch Tech Bubble 2.0 by EconMatters “ I guess I should warn you, if I turn out to be particularly clear, you’ve probably misunderstood what I’ve said.” – Alan Greenspan
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2018- S&P sectors for the past week-
Seasonal Analysis: Spice Up Your Portfolio in a Bland Month Posted by lplresearch June has historically been a bland month for the stock market; however, using seasonal analysis may help add some spice to portfolios in an otherwise lackluster time period for U.S. equities. On balance, June can be a hit-or-miss month for equity returns, with a slightly higher trend to the upside. On average, the S&P 500 Index has lost 0.5% in June over the past 20 years, though history has shown that stocks have moved higher 55% of the time over the same period. And when June has generated positive returns for the S&P 500, the average magnitude move higher for the month has been 1.9%; when negative, the average return has been -3.4%. Considering the potential for modest-to-lower returns on the index, our seasonal analysis in the LPL Chart of the Day highlights specific sectors and industry groups that could be poised to outperform the broad index in June and potentially add spice to the overall portfolio strategy if suitable investors. Importantly, nonseasonal factors still influence performance and should not be ignored. As the LPL Chart of the Day above shows, a variety of sectors have on average tended to exhibit relative strength during June, with the healthcare, energy, telecommunication services, and information technology sectors exhibiting the strongest returns. However, if you are interested in a more targeted strategy, you may consider industry-level investments like the healthcare equipment and services, pharmaceuticals, and biotechnology and life sciences groups, which have posted the highest average relative returns with a greater frequency of outperformance; or the software & services industry group, which has significantly outperformed the index in June over the past 20 years. One way to potentially help mitigate the effects of a historically bland period for stocks, and add some spice to your portfolio, is by incorporating seasonal statistics as part of your overall investment management process. Stay tuned for future seasonal analysis updates on the LPL Research blog. How Do President Trump’s First 500 Days Rank? Posted by lplresearch As President Trump mentioned on Twitter yesterday, he has officially been in office for 500 calendar days. Although how he has done has led to many an argument at family dinners, it is easier to break things down from purely a market perspective. “It has definitely been an eventful stretch, but what stands out is that the Dow has made more new highs under President Trump during the first 500 days than any other President going back to 1900. The 25.2% return is quite impressive, but it ranks sixth out of the past 20 Presidents,” according to LPL Research Senior Market Strategist Ryan Detrick. As our LPL Chart of the Day shows, Trump narrowly topped President Obama, but Franklin Roosevelt easily tops the list as he oversaw the Dow’s nearly 80% run-up as the country emerged from the Great Depression: Jobs, Jobs, and More Jobs? Posted by lplresearch It’s natural for job growth to wane as the economic cycle ages, when businesses are already running at or near target employment levels and labor is becoming scarcer. That pattern has held true so far in this cycle, as evidenced by our LPL Chart of the Day, which shows average yearly job growth peaked at 261,000 in February 2015 and has gone through a natural slowing process since: Nevertheless, as LPL Research Chief Investment Strategist John Lynch explained, “Job growth remains at very healthy levels for this point in the cycle, and the most recent report provided growing evidence that the trend may be ramping up.” The one-year average of monthly job growth has clearly stabilized and has even accelerated in the short term, rising 29,000 over the last eight months. The job numbers are much noisier (more statistically uncertain) than they are usually given credit for, so we wouldn’t make too much of that eight-month change (yet), but at the very least we’ve seen improvement. For more on jobs and wages, please see our Weekly Economic Commentary. Massive Market Breadth Jun 8, 2018 Here’s one you don’t see often. While the S&P 500 is still more than 3.5% off of its record closing high, breadth has been very strong. The chart below shows the cumulative A/D line of the S&P 500 over the last twelve months. Leading up to the peak in January, breadth and price tracked each other closely. Since that high in January, though, breadth has held up extremely well. In fact, back in March when the S&P 500 made its first attempt at a recovery, the cumulative A/D line actually made a new high. Since then, the trend has remained the same. With each market pullback, breadth has seen smaller declines. As a result, since the S&P 500’s record high in January, its cumulative A/D line has made ten new record highs. Furthermore, if breadth finishes the day positive (as it is now), Friday will mark the fifth straight day where the S&P 500’s cumulative A/D line made a new high. Five record highs in the same week? You don’t see that very often! Markets Eyeing More Hikes Around The World Jun 6, 2018 Each week, we publish a Fixed Income Weekly, a recap of interest rate and credit markets in the US and around the world. In addition to charts and tables keeping track of performance and levels for fixed income assets in the US and around the world, we also present a weekly trade idea and unique analyses. This week, we introduced a global central bank index using overnight index swap forwards which indicate market pricing for short-term central bank rates and current central bank rates. We can then convert those variables into 25 basis point increments, each representing 1 hike, and weight them by purchasing power parity (PPP) GDP levels. We include data for the US, Canada, Mexico, Brazil, the Eurozone, the UK, Switzerland, Norway, Sweden, Czech Republic, Poland, Australia, New Zealand, Japan, India, and South Korea, capturing a wide swath of developed and emerging markets. As shown in the chart below, despite a small pullback over the last few weeks thanks to Italian stresses, interest rate markets are still pricing an output-weighted average of 1.6 hikes across the global economy between now and mid-2019. That’s near the most in over 5 years, and represents a significant shift from the neutral to cutting bias of the 2016-2017 period. Casino Stocks Not Benefiting Much From Sports Betting Ruling So Far Jun 8, 2018 Back on May 14th when the US Supreme Court ruled that a nationwide ban on sports betting was unconstitutional, many pundits (both in finance and sports) immediately argued that the casino stocks would be big beneficiaries. Since the Supreme Court ruling, though, the average and median performance of publicly traded casino stocks has actually been weaker than the S&P 500’s 1.8% gain. As shown below, the winners in the casino space since the SC ruling have been Boyd Gaming (BYD), Golden Entertainment (GDEN), and Empire Resorts (NYNY). Las Vegas Sands (LVS), MGM Resorts (MGM), and Wynn Resorts (WYNN) have all seen declines. Robust Advance/Decline Lines Underpinning Rally Once again today, NASDAQ and Russell 2000 closed at new all-time highs. DJIA and S&P 500 actually performed even better, making up ground and closing in on previous all-time highs reached way back in January. Financials were leading today with SPDR Financials (XLF) up 1.86%. Even the energy sector was positive today, SPDR Energy (XLE) climbed 0.48% even as crude oil slipped. This broad participation across numerous sectors is positive and can be seen in the above chart of NYSE, NASDAQ, Russell 2000 and S&P 500 cumulative daily advance/decline line chart. All four Advance/Decline lines have exceeded their previous highs. NASDAQ’s and Russell 2000’s A/D lines are the strongest while NYSE and S&P 500 are improving. As long as A/D lines remain in clear trends higher the current rally will likely continue. Tech and Small-caps Buck Midterm June Blues Tech-heavy NASDAQ index joined the Russell 2000 small-cap index today with a new all-time closing high. Russell 2000 has been on a roll with new all-time closing highs since May 16. NASDAQ’s previous all-time high close was on March 12 of this year. With the gains of the last two trading days, NASDAQ and Russell 2000 are well on their way to avoiding typical midterm year June weakness. NASDAQ is up 2.2% so far and Russell 2000 has climbed 1.2% this June. Both are well above average compared to past midterm June performance. DJIA, S&P 500 and Russell 1000 are also performing well all logging gains of around 1.5% over the past two trading sessions. However, to join the new all-time high party DJIA still needs to gain 7.3%, S&P 500 4.6% and Russell 1000 4.2%.
Stock Market Analysis Video for June 8th 2018 Video from AlphaTrends Brian Shannon ShadowTrader Video Weekly 6.10.18 Video from ShadowTrader Peter Reznicek (VIDEO NOT YET UP!)
Here are the current major indices pullback/correction levels from ATHs as of week ending 6.8.18- Here is also the pullback/correction levels from current prices- ...and here are the rally levels from current prices-
Here are the most anticipated ERs for this upcoming week ahead (I'll also have the weekly earnings calendar posted in here as well once it's out) ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 6.11.18 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 6.11.18 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 6.12.18 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 6.12.18 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 6.13.18 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 6.13.18 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 6.14.18 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 6.14.18 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 6.15.18 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 6.15.18 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES!
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 (6/11) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (6/11-6/15) <-- click there to cast your weekly market vote and stock picks! ======================================================================================================== 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!
And as promised here is the most anticipated earnings calendar for this upcoming trading week ahead- ($ADBE $GOOS $RH $PLAY $BITA $HRB $KMG $YTRA $MIK $SBLK $CASY $LE $FNSR $KFY $TLRD $SAIC $FRED $JBL $LMNR $OXM $SNOA $APPS $PVTL $JW.A $DTEA $TNP $CRWS $CHKE $CULP $AZRE) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning June 11th, 2018 <-- click there to view!
Long Energy right now. Been long XLE June calls from .84 last week. Just picked up some July $79s for .88. Also went long GUSH as 38.91 this morning along with my EGY long from 2.34
Again TICK barely touching +500. This market I tell you, if there's any upside room it will squeeze right up to it. Looks like we need to touch SPX 2800.
Dennis Rodman is in Singapore for the summit. Donald Trump says he wasn't invited. Rodman's trip is sponsored by PotCoin. This is history in the making.
The summit will start at 9 pm Eastern I believe. I really hope we will hear some good news because it would be a good news for the whole world.
