Welcome Stockaholics to the trading week of February 5th! 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 Earnings: Bristol-Myers, Ryanair, Church and Dwight, Booz Allen Hamilton, Leggett and Platt, Arconic, Citrus Logic Jay Powell is sworn in as Fed Chair 9:45 a.m. Services PMI 10:00 a.m. ISM nonmanufacturing 2:00 p.m. Senior loan officer survey Tuesday Earnings: Disney, BP, General Motors, Toyota Motors, Archer Daniels Midland, Cummins, Tapestry, Gilead Sciences, Snap, Pioneer Resources, Chipotle Grill 8:30 a.m. U.S. trade deficit 10:00 a.m. JOLTs Wednesday Earnings: Tesla Motors, Sanofi, 21st Century Fox, Valvoline, Hasbro,Michael Kors, Ball Corp, IAC/Interactive, Flowers Food, iRobot, TrueBlue 8:30 a.m. New York Fed President William Dudley 11:15 a.m. Chicago Fed President Charles Evans 3 p.m. Consumer credit 5:30 p.m. San Francisco Fed President John Williams Thursday Earnings: AIG, Nvidia, FireEye, News Corp, Expedia, Zillow, Activision Blizzard, Viacom, Teva, Nissan, Alexion Pharma, Cardinal Health, KKR, Tyson Foods, Regeneron, Yum Brands 4:50 a.m. Dallas Fed President Robert Kaplan 8:00 a.m. Philadelphia Fed President Patrick Harker 8:30 a.m. Jobless claims 9:00 a.m. Minneapolis Fed President Neel Kashkari 9:00 p.m. Kansas City Fed President Esther George Friday Earnings: Tenneco, Nipon Telegraph, Moody's, CBOE Holdings 10:00 a.m. Wholesale trade
Turmoil: Dow's Biggest Point Rout Since Lehman; Bonds, Bitcoin Crash This week for Bitcoin, Bonds, and Bullish stockholders... Today, and this week, saw some extremes: This week was the worst for bonds & stocks combined since Feb 2009 Dow's biggest single-day drop since Brexit (June 2016) Dow's biggest point drop since Lehman (Oct 2008!) Dow's worst week since Jan 2016 VIX's biggest spike since Aug 2015 China Deval / Flash-Crash China's Shanghai Comp worst week since Dec 2016 China's Shenzhen Comp worst week since Jan 2016 Germany's DAX worst week since Feb 2016 30Y UST Bond's worst weekly drop since the election (Nov 2016) UST Yield Curve (2s30s) biggest steepening week since election (Nov 2016) High Yield Bond's worst week since March 2017 Dollar Index first weekly gain in two months Dollar Index biggest daily gain since Jan 2017 Gold's worst week in two months Silver's worst week since July 2017 Bitcoin's worst week since Jan 2015 Where were the dip-buyers?! China ugly.. Europe dumped into the red... And US Stocks were crushed... Futures show the chaos a little better - Friday's melt-up, numerous v-shaped recoveries this week as dip-buyers crambled back in... and then today! And today was a bloodbath for stocks... The Dow ended down 670 Points - the biggest point decline since Lehman in Oct 2008... Year-to-Date, Trannies and Small Caps have given up most of their gains... Retailers and Energy stocks were the big laggards but everything was whacked with banks tumbling today despite soaring rates and steepening curves... VIX spiked to its highest since the election today... Risk-Parity fund deleveraging was triggered again (with bonds and stocks down hard)... Risk-Parity funds had their worst day since May 2017 today... It appears the bond spike has spooked stocks... In fact this is the worst day for aggregate losses in bonds and stocks since September 2016... Bonds bloodbath'd on the day and week... 30Y Yields were within a tick or two of 3.10% this week... The yield curve steepened notably on the week And debt ceiling anxiety is back as the Bill curve inverts... The Dollar Index managed its first weekly gain of the year, but remains well below the Trump rescue highs... In commodity-land, everything was red on the week with silver getting monkey-hammered today... Silver is back at 6-week lows.. Finally, there was carnage in cryptocurrencies this week, with a modest rescue today. This was the worst week for Bitcoin since January 2015, back below $9,000... And finally... remember, you are here...
Spoiler: Weekend Reading: Did The Market Just Get 'Woke'? Authored by Lance Roberts via RealInvestmentAdvice.com, Since the beginning of this year, we have been warning of the potential for a correction. Of course, such warnings seemed pointless as the nearly “parabolic” rise in the markets seemed unstoppable. The chart below shows the current acceleration through the end of January. But all of a sudden, something seems to have changed as the market stumbled this past week and has been unable to regain its footing. So, what “woke” the markets? Was it the sudden realization that Central Banks globally are reducing Q.E. programs? Or, that economic growth may be weaker than expected given recent numbers? Or, something else? Whatever, the excuse turns out to be, the real culprit is seen in the chart below. As I have been discussing “ad nauseam” over the last couple of years, interest rates are now stuck in a trading range that will likely remain between 0-1% during the next recessionary drag with a 3% ceiling as seen in 2014. Importantly, rates are at levels of overbought conditions only seen 3-times previously going back to 1980. I am going to discuss this in more detail in this weekend’s forthcoming “Real Investment Report.” However, the point here is that since interest rates drive everything from borrowing, to spending, to capital investment – higher rates negatively impact economic growth. Since stocks are ultimately a reflection of the economy, it is hard to suggest that stocks will continue to rise in the face of higher rates. Furthermore, higher rates are rapidly crushing the one argument used by bullish investors over the last eight years which has been “low rates justify higher valuations.” As I have repeatedly stated in the past, it is one argument that can literally change overnight. Is this the beginning of the next major market correction? Probably not. There is simply too much exuberance currently in the market. It will take several failed rally attempts to begin to erode that base of bullishness. But therein lies exactly what you want to look for. Rallies that fail at previous resistance levels, rising volatility and declining rates of participation. As with every previous major market correction in history, investors were always given multiple warnings BEFORE the crash actually occurred. (We have a special report coming out next week to our newsletter subscribers only discussing these warning signs. Click here to enter your email address if you want a copy of this report.) Of course, few investors heeded those warnings because they had been lulled into the belief “this time is different.” It wasn’t then. It won’t be next time either. Here is your weekend reading list. Economy & Fed Trumps Trade & Investment Goals Don’t Add Up by Caroline Baum via MarketWatch What Really Worries Wall Street Analysts by Simon Constable via US News Will The Fed Start Q.T.? by Kevin Muir via The Macro Tourist Ugly Politics & The U.S. Stock Market by Macromon via Global Macro Monitor Countering The Bond Bear Narrative by Edward Harrison via Credit Writedowns Why Don’t Republicans Fret About The Debt Anymore? by Annie Lowrey via The Atlantic $AMZN Should Not Be In Charge Of Fixing Our Healthcare by Eric Levitz via New York Magazine Trump Dreams Of A 1950’s Era Economy by Noah Smith via Bloomberg Markets Edwards: It Feels Similar To 1987 by Tyler Durden via ZeroHedge What You Need To Do Now BEFORE The Tumble by Michael Sincere via MarketWatch These 4-Indicators Say Buy The Dip by Bryce Coward via Knowledge Leaders Momentum Isn’t Magic by Sanjurjo & Miller via The Conversation Why Won’t The Market Correct? Greed!by Howard Gold via MarketWatch Are You Ready For The Next Market Melt-DOWN by Michael Kahn via Barron’s The 401k Brag by Sally French via MarketWatch The Reasons Why I’m Not Bailing On Bonds by Michael Cannivet via RCM Is U.S. Economy Hostage To The Stock Market by Robert Samuelson via RCM Bull Market Piles Up Some Urgent Questions by Nir Kaissar via Bloomberg Gadfly Key U.S. Stock Levels To Watch For The Week Ended 02/02/18 by Jesse Colombo via RIA The Next Maestro by Michael Lebowitz via RIA Cryptocurrency Mania Bitcoin Crashes To Lowest Level Since Thanksgiving by Tyler Durden via ZeroHedge Bitcoin Versus The IRS by Shawn Langlois via MarketWatch Bitcoin And Taxes by Jeff Roberts via Fortune Stocks & The Bitcoin Crash by Bryce Coward via Knowledge Leaders Bitcoin: “Beanie Babies” Of The Moment by Vitaliy Katsenelson Research / Interesting Reads Why The Next Downturn Won’t Be Like 2008 by Wolf Richter via Wolf Street Alan Greenspan On The Twin Bubbles by Macromon via Global Macro Monitor The Possibilities Are Frightening by Kevin Muir via The Macro Tourist 5-Mega Trends & How To Invest In Them by Jeff Reeves via MarketWatch Biggest Mistake Americans Make Saving For Retirement by Emmie Martin via CNBC Will Anyone Care About The GOP Tax Cut? by Bess Levin via Vanity Fair Your Expected Tax Refund & The Psychology Of A Windfall by Elizabeth Harris via Forbes It’s Getting Lowly At The Top by Dana Lyons via The Lyons Share Amazon Adds A McDonalds In Market Cap In Month by Jesse Felder via The Felder Report “Speculation is an effort, probably unsuccessful, to turn a little money into a lot. Investment is an effort, which should be successful, to prevent a lot of money from becoming a little.” ― Fred Schwed Jr.
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2018- S&P sectors for the past week-
February’s performance generally improves in midterm years Since 1950, February is up only slightly more than half the time and up marginally on average. However, small cap stocks, benefiting from “January Effect” carry over; tend to outpace large cap stocks in February. The Russell 2000 index of small cap stocks turns in an average gain of 1.2% in February since 1979—just the seventh best month for that benchmark. In midterm years, February’s performance generally improves with average returns all increasing. Here again it is the Russell 2000 small-cap index that shines brightest gaining 1.9% on average since 1982. Russell 1000 is second best, averaging gains of 1.3% since 1982. DJIA and NASDAQ average gains of 1.0% (since 1950 and 1974 respectively) while S&P 500 lags with average advance of 0.7% (since 1950). Tom Terrific? The Super Bowl Indicator Might Disagree The Super Bowl indicator suggests that stocks rise for the full year when the Super Bowl winner comes from the original National Football League (now the NFC), but when an original American Football League (now the AFC) team wins, stocks fall. We would be the first to admit that this indicator has no connection to the stock market, but the data doesn’t lie—the S&P 500 Index has performed better, and posted positive gains with greater frequency, over the past 51 Super Bowl games when NFC teams have won. A simpler way to look at the Super Bowl indicator is to look at the average gain for the S&P 500 when the NFC has won versus the AFC—and ignore the history of the franchises. This similar set of criteria has produced an average price return of 10.8% when an NFC team has won, compared with a return of 5.8% with an AFC winner. An NFC winner has produced a positive year 82% of the time, while the S&P 500 has been up only 63% of the time when the winner came from the AFC. Would you believe the numbers actually get worse when the Patriots are involved? That’s right; the S&P 500 has only gained 3.1% on average in years when the Patriots play in the big game, but things get even worse if they win. “Pats fans might be ecstatic that Tom Brady is starting in a record-breaking eighth Super Bowl, but market bulls don’t want to see them win, as stocks are up only 1.5% for the year on average after a victory versus up 5.1% if they lose,” said Ryan Detrick, Senior Market Strategist. “Tom might be terrific, but maybe not in all cases.” We would like to reiterate that this is in no way relevant to investors, but it sure is more fun to talk about the Super Bowl and stock market returns than politics this Sunday evening. We hope everyone has a great Super Sunday and wish both the Eagles and Pats luck! FULL DISCLOSURE – LPL Research has an office in Boston and we have many Patriots fans, but the author of this piece sure isn’t one. A Big January Has Bulls Smiling An old adage on Wall Street suggests, “So goes January, goes the year.” With stocks seeing one of the best January returns ever, it is time to take a closer look at the January barometer. The January barometer was first discussed by Yale Hirsh of the Stock Trader’s Almanac in 1972. Simply put, if the first month of the year is green, it bodes well for the rest of the year and vice versa if we see a red January. Looking at the numbers confirms that when the S&P 500 Index is green in January the rest of the year (final 11 months) is up 12.2% on average, well above the average return of 7.9% over the final 11 months of the year; but when that first month is red the final 11 months are up only 1.2% on average. According to Ryan Detrick, Senior Market Strategist, “The January barometer isn’t perfect, but it does have a pretty solid track record. Now where things really get interesting is when that first month is up more than 5% (like 2018 is on track to be), the return over the final 11 months actually gets stronger.” Of course we don’t suggest simply investing based on what the first month does, but with the overall global economic backdrop and corporate earnings growth as strong as it appears to be, this is yet another sign that 2018 may see a continuation of the bull market. In all the instances when the S&P 500 was up more than 5% at the end of January, the full year return has never been negative (higher 12 out of 12 times); but it is worth noting that they weren’t smooth rides. The average peak-to-trough correction was 10.7%, while the smallest intra-year pullback was -4.4%. As we noted in our recent Weekly Market Commentary, we are on the lookout for added volatility in 2018 as the economic cycle ages, but we would use any pullbacks to add to portfolio positions. This study is another example as to why we expect the bull to continue, but to be ready for a potentially bumpy ride. Why Midterm Years Can Slip Up Bull Markets Equities were met with tremendous success during the first year of President Trump’s term, but now we’re headed into the much more historically troublesome midterm year. As Ryan Detrick, Senior Market Strategist notes, “Midterm years tend to be a banana peel for markets, as they see the largest pullbacks out of the four-year presidential cycle. However, those who hang on for the ride tend to see a significant bounce over the next year.” Taking a closer look, since 1950, the S&P 500 Index has been down 16.9% on average at its intra-year low during midterm years, though it tends to bounce back, posting an impressive 32.0% average gain over the subsequent twelve months.* Now take a look at all of the midterm years and how the S&P 500 performed after the intra-year lows were made: The action over the past year has been historic on many levels, but we have our concerns as the bull market continues to move higher. In our next Weekly Market Commentary, due out later today, we will list some of the amazing streaks which make the recent market action truly special, but we will also look at a few other potential near-term worries which could trigger some long overdue volatility.
Stock Market Analysis for Week Ending 2.2.18 Video from AlphaTrends Brian Shannon ShadowTrader Video Weekly 2.4.18 - How Bad Was It? Video from ShadowTrader Peter Reznicek
Here are the current indices pullback/correction levels as week ending 2.2.18- ...and here are the rally levels as of this week ending-
Here are the most anticipated ERs for this upcoming week ahead (I'll also have the earnings chart posted in here as well once it's ready) ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 2.5.18 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 2.5.18 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 2.6.18 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 2.6.18 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 2.7.18 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 2.7.18 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 2.8.18 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 2.8.18 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 2.9.18 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 2.9.18 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
Here are the scheduled earnings before the market opens on Monday- ($BMY $ON $SYY $ARNC $BAH $HES $GOLD $CHD $CTLT $MCY $SALT $NMM)
Stockaholics come join us on our stock market challenge threads for this upcoming trading week ahead!- ======================================================================================================== Stockaholics Daily Stock Pick Challenge & SPX Sentiment Poll for Monday (2/5) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (2/5-2/9) <-- click there to cast your weekly market vote and stock picks! ======================================================================================================== And finally, we have a brand spanking new mystery chart challenge now up! Weekly Mystery Chart & Technical Analysis Challenge (2/5-2/9) <-- click there to participate! ======================================================================================================== It would be pretty sweet to see some of you join us and participate on these! I hope you all have a fantastic weekend ahead!
Both trannies and small caps are at the 50 ma. Small caps with a nice technical pattern setting up; looking for a bounce.
And as promised here are the most anticipated earnings calendar for this upcoming trading week ahead: ($NVDA $TSLA $TWTR $SWKS $SNAP $DIS $ATVI $GILD $GM $CMG $BMY $AGN $TEVA $TTWO $BP $COHR $SYY $REGN $NTES $FEYE $ARNC $CVS $EXPE $SKX $HES $BAH $CMI $OCLR $GOLD $CHD $IRBT $LITE $GRUB $CTLT $GOOS $HAS $KORS $MCY $TRVG $ONVO $PM) If you guys want the full earnings post please see this thread here- Notable Earnings Releases for the week beginning February 5th, 2018 <-- click there!
MGA they make car parts. P/E under 10, $2B profits ttm, 1% short float, 2% dividend. In truth, the sector carries low P/Es, but check MTOR (a smaller company) and how they fared last week with their ER.
I was thinking about this too. I am thinking maybe a scan that will produce stocks that are in a strong uptrend that are below the Bollinger Bands (or a strong downtrend that are above the Bollinger Bands when the markets gap up). Preferably the pull back will be on lower volume and near support. I'm still playing around with a lot of stuff like volumes, supports etc. but the current version came up with LKQ, BWA, MPC, MCD, PNR, AZO and WM fwiw..
Nice, I'll have to look through some of these early Monday morning, if I'm not too hungover. Got a super bowl party tonight at our house, then work at 6am tomorrow... ugh
