Welcome Stockaholics to the trading week of June 4th! 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: Ambarella 10:00 a.m. Factory orders Tuesday Earnings: Dell Technologies, Palo Alto Networks, Coupa Software 9:45 a.m. Services PMI 10:00 a.m. ISM nonmanufacturing 10:00 a.m. JOLTS 10:00 a.m. QFR Wednesday Earnings: Vera Bradley, Signet Jewelers, Thor Industries, Cloudera 8:30 a.m. International trade 8:30 a.m. Productivity and costs Thursday Earnings: J M Smucker, Vail Resorts, Broadcom, Cooper Cos 8:30 a.m. Initial claims 10:00 a.m. QSS 3:00 p.m. Consumer credit Friday G7 Leaders Summit in Charlevoix, Quebec, Canada 10:00 a.m. Wholesale trade
US Stocks, Bonds, Dollar Bid After Quitaly Chaos, Rajoy's Rout, & Trade War Turmoil US Bonds Up, US Stocks Up, US Dollar Up... Everything is awesome! Here's why: New anti-establishment Italian government? Check. New anti-establishment, socialist Spanish government? Check. Trade war between the US and Europe, Mexico, & Canada? Check. Deutsche Bank (most systemically risky bank in the world at one point) downgraded to a B-handle? Check. Fed Tightening as rate-hike odds rise after good jobs data trumps EU risk? Check. The holiday-shortened week ended with Nasdaq and Small Caps outperforming, but The Dow lower... On the day, stocks outperformed post-Trump's tweet on payrolls, bonds and gold ended lower... EU banks blodbath'd... The big US banks ended the week in the red... Big Tech soared... This won't end well... Another big short-squeeze this week... Credit markets rallied back from extreme after Italy but remain notably decoupled from equity risks... Treasury yields all ended lower on the shortened week, with the long-end outperforming...though a massive intra-week range after Italy's chaos... The yield curve flattened for the 5th time in six weeks to new 11 year flats... Oh and ignore this... The Dollar Index managed to hold on to gains to make it 7 weeks in a row of increases...(though the last two weeks have been very rangebound) Emerging Markets FX erased last week's dead cat bounce gains... Bitcoin, Litecoin, and Ripple ended the week unchanged after some notable volatility but Ethereum and Bitcoin Cash underperformed... Ugly week for WTI as Copper outperformed... WTI closed back below $66 for the first time in over 6 weeks... Gold pushed back below $1300 into today's close... And finally, there's this - probably nothing though...
Spoiler: Weekend Reading: Just A Pause That Refreshes? Authored by Lance Roberts via RealInvestmentAdvice.com, On Tuesday, the market tumbled on concerns over Italian debt. (A problem, by the way, I discussed a couple of years ago.) However, on Wednesday, the market reversed course and apparently the crisis was over. Make no mistake, nothing was fixed or resolved, investors just chose to ignore the problem under the belief that Central Bankers will unite in some form of bailout. It isn’t just Italian debt, which is magnitudes larger than Greece’s debt crisis, but it is also Spain and a host of other smaller European countries that continue to ramp up debt in hopes that economic growth will someday bail them out. However, sustained economic growth has failed to appear. As long as interest rates remain low and negative in some cases, debt can continue to be accumulated even with weaker rates of economic growth. More importantly, as long as rates remain low, the banking system can continue to play the “hide-the-debt game” through derivatives, swaps and a variety of other means. But rates are rising, and sharply, on the shorter-end of the curve. Historically, sharply rising rates have been a catalyst for a debt related crisis. As long as everything remains within the expected ranges, the complicated “math” behind trillions of dollars worth of financial instruments function properly. It is when those boundaries are broken that things “go wrong” and quickly so. People have forgotten that in 2008 a major U.S. financial firm crashed as its derivative based exposure “blew up.” No, I am not talking about Lehman Brothers, the poster-child of the financial crisis, I am talking about Bear Stearns. In just 365-days, Bear Stearns stock went from $159 to $2, with about half of the loss occurring within a few weeks. Bear Stearns was the warning shot for the financial markets in early 2008 that no one heeded. Within a couple of months, the markets dismissed Bear Stearns as a “non-event” and rallied to a higher level than prior to the event, and almost back to highs for the year. Remember, there was “nothing to worry about” at the time, even though the Fed was increasing interest rates, as the “Goldilocks economy” could handle tighter monetary policy. Sure, housing had been slowing down, mortgage delinquencies were rising, along with credit card defaults, but there wasn’t much concern. Today, we are seeing similar signs. Interest rates are rising, along with delinquencies, defaults, and a slowing housing market. But no one is concerned as the “Goldilocks economy” can clearly offset these mild risks. And no one is paying attention to, what I believe to be, one of the biggest risks to the global financial markets – Deutsche Bank. Deutsche Bank is clearly showing signs of financial trouble. More importantly, it is magnitudes larger, in terms of derivative-based exposure, than Bear Stearns and Lehman Brothers combined. Bear Stearns and Lehman Brothers were not banks and did not hold deposits. As such, they posed significantly less risk to the financial system. As Doug Kass recently noted: “The collateral risks to Europe are large – most notably to ECB and to Germany. In it’s extreme it could mean Italy separates from the rest of the EU. To me, as I have written in the past, Deutsche Bank is particularly exposed. But, to this observer, who has consistently warned about Deutsche Bank being the next Black Swan and the imbalances in the European banking system (particularly in Italy), the risks of a possible negative multiplier effect on other European financial intermediaries and on the region’s economic prospects is profoundly real.” But, while “everyone loves a good bullish thesis,” let me restate the reduction in the markets previous pillars of support: The Fed is raising interest rates and reducing their balance sheet. Short-term interest rates are rising rapidly. The yield curve continues to flatten and risks inverting. Credit growth continues to slow suggesting weaker consumption and leads recessions The ECB has started tapering its QE program. Global growth, especially in Europe, is showing signs of stalling. Domestic growth has weakened. While EPS growth has been strong, year-over-year comparisons will become challenging. Rising energy prices are a tax on consumption Rising interest rates are beginning to challenge the equity valuation story. “While there have been several significant corrective actions since the 2009 low, this is the first correction process where liquidity is being reduced by the Central Banks.” Oh, and just one last chart. During 2007, and into 2008, the S&P 500 traded sideways in a 150-point range. That range was extended to 300-points before the crash actually occurred. It was believed to be just a “pause that refreshes.” Since January of this year, the S&P 500 has been trading in a 300-point range (similar in percentage terms to the period preceding Bear Stearns). It is also believed to just be a “pause that refreshes.” Just something to think about as you catch up on your weekend reading list. Economy & Fed Is A “Job Guarantee” Program The Best Dem’s Can Offer by John Tamny via Forbes The Fed’s Verbal Gymnastics Includes Back Flips by Caroline Baum via MarketWatch Trumponomics Is Working by Stephen Moore via The Washington Times One Side-Effect From Trump’s Trade War Could Last For Years by Pedro Da Costa via BI People Are Less Selfish Under Capitalism by Barry Brownstein via FEE Don’t Worry About Rate Hikes Next Year by Danielle Wiener-Bronner via CNN Money Europe Has A Big Problem by Macromon via Global Macro Monitor Whither The Economy by Mark Mellman via The Hill How To Defend Capitalism by Wayne Crews via Forbes Markets Biggest Pain For Trades Since WWII by Tyler Durden via ZeroHedge Efficient Markets, Not So Much by Kevin Muir via The Macro Tourist China’s Yuan No Threat To The Dollar by Simon Constable via Forbes Key Test Developing For Global Equity Rally by Dana Lyons via The Lyons Share Mobius: Expect A 30% Drop In U.S. Stocks by Evenlyn Chang via CNBC Passive, Private Market Force by Seth Levine via The Integrating Investor Next Recession Might Not Be So Bad…Maybe via Upfina Consistency, The Playground Of Dull Minds by Anshul Khare via Safal Niveshak Most Read On RIA How Far Can Stocks Fall by Lance Roberts The Headwind Facing Housing by Michael Lebowitz 70 Is The New 90, The Psychological Impact Of Higher Oil Prices by Lance Roberts Retirement Planning – Life Happens by Richard Rosso Kass: The World Is Flat by Doug Kass Research / Interesting Reads NIRP’s Revenge by Wolf Richter via Wolf Street Retirement Myths Vs. Reality by Robert Powell via USA Today How Much Have 30-Somethings Saved by Alessandra Malito vis MarketWatch How To Reduce Your Investment Risk by Dan Caplinger via Motley Fool 4-Ways To Cut Spending In Retirement by Paul Katzeff via IBD The 4-R’s That Built The West by Art Carden & Deirdre McCloskey via FEE Work 275 Years To Earn The CEO’s Wages by David Gelles via NYT Next Recession? Some Haven’t Recovered From The Last by David Dayen via The New Republic Time To Worry? by John Cochran via The Grumpy Economist Why Markets Are Worried By Italy Again by Victor Reklaitis via MarketWatch 2018-Internet Trends Report by Josh Constine via Tech Crunch “Government is one of the five evils – along with fire, floods, thieves and enemies.” ― Jeffrey Friedland, All Roads Lead To China It could never happen again, right?
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2018- S&P sectors for the past week-
Time for a June Swoon? Posted by lplresearch U.S. equities advanced in May to extend their win streak during the month to six years, but can the summer rally continue? First things first, historically June has been a stumbling block for stocks. As the LPL Research Chart of the Day shows: June has been one of the weakest months for the S&P 500 Index—over the past 10 years, only January sported a weaker average return. Although June could potentially provide some volatility, we would continue to be a buyer amid any equity weakness. “One of the main reasons we don’t expect a major June sell-off in 2018 is because under the surface, small cap indexes are leading, which is very encouraging. With the Russell 2000 Index making new highs, we believe this could be a signal that new highs for large cap stock indexes may likely follow later this year,” said Ryan Detrick, LPL Research Senior Market Strategist. So, as we close out May, small caps (and the Nasdaq) have led so far in 2018, both gaining roughly 8% year to date, while the S&P 500 was up less than 2%. Although that’s a large disparity, it’s actually quite normal. Since 1950,* there have been 24 years in which the S&P 500 gained 15% or more, and the index has posted year-to-date gains of only 2% on average through the end of May the following year. In other words, some type of consolidation early in the year after strong gains is normal. Taking it a step further, when the S&P 500 has been up between 0% and 5% by the end of May, i.e., advancing modestly, the following seven months (the rest of the year) were up 6.8% on average. This is well above the overall 3.8% average return for the latter seven months of the year. With the benefits of fiscal policy, still benign inflation, and strong corporate earnings, as mentioned in Outlook 2018: Return of the Business Cycle, we continue to expect stock indexes to gain 10% when all is said and done in 2018. Is Sell in May Working This Year? To all the market seasonality naysayers and “Sell in May” or Best Six Months/Worst Six Months critics, we say thank you for your skepticism. Despite your disbelief (and perhaps because of it) the recurring seasonal market patterns highlighted in the Stock Trader’s Almanac continue to persist. Of course they are not perfect and do not work 100% of the time, and some have fallen by the wayside and some have shifted – we’ve tracked and updated those. However, supported by a host of academic studies and papers (just Google them yourself) and now years of evidence-based results, our Tactical Seasonal Best & Worst Six Months Switching Strategy, a slightly more sophisticated version of “Sell in May and Go Away,” continues to outperform over the long and short term, 2017 notwithstanding. Yes the Worst Six Months (or “Sell in May”) was quite positive in 2017 and better than the Best Six. This has happened before as it did in 2009 (Post Financial Crisis) and 2003 (Iraq war) and it will again. But that has not changed or tainted the seasonality, strategy or results. Just think back to how well the market and the Switching Strategy did following those years. And remember we are not talking about the plain vanilla “Sell in May” on May first (see page 52 of the Stock Trader’s Almanac 2018 for the results of our Best Six Months Switching Strategy using MACD Timing. Here are the results since 2009 to give you an idea. So far since our Best Six Months Seasonal MACD Sell Signal for the Dow and S&P 500 the Dow is up about 2.1% and the S&P 500 is up about 2.6%. Definitely a solid move, but this has enabled us to take some profits and sell losers at favorable prices. And our defensive, risk-off bond positions in iShares 20+ Year Treasury (TLT) and iShares Core US Aggregate Bond (AGG) are up and on the rise as stocks have begun to weaken again as seasonality and midterm machinations begin to kick in. Typical June Trading: More Weakness then Strength Over the last twenty-one years, June has a mixed record. DJIA, S&P 500 and Russell 1000 have all posted average losses while NASDAQ and Russell 2000 have recorded average gains of 0.9%. All five indexes start the month well with NASDAQ and Russell 2000 taking an early lead, but that strength has quickly faded with a mild slide that lasts until around mid-month. A three day rally then ensues before all five indexes really roll over and briskly head lower. The last three days of the month are positive on average with NASDAQ and Russell 2000 charging higher to finish the month higher, but DJIA, S&P 500 and Russell 1000 come up short of full-month gains. June Worst DJIA, S&P 500 and Russell 1000 Month of Midterm Years June has shone brighter on NASDAQ stocks over the last 47 years as a rule ranking ninth with a 0.6% average gain, up 25 of 47 years. This contributes to NASDAQ’s “Best Eight Months” which ends in June. June ranks near the bottom on the Dow Jones Industrials just above September since 1950 with an average loss of 0.3%. S&P 500 performs similarly poorly, ranking tenth, but essentially flat (–0.02% average). However, small caps tend to fare well in June. Russell 2000 has averaged 0.6% in the month since 1979. In midterm years since 1950, June ranks no better than ninth. June is the #12 DJIA, S&P 500 and Russell 1000 month in midterm years. Average losses range from 1.4% by Russell 1000 to 1.9% from S&P 500. Of the five indexes, none has a winning track record in June. All have declined more than they have risen. Top Performing Stocks in May Jun 1, 2018 By just about any account, the month of May was a good one for US equities. The S&P 500 was up over 2%, which was the best month since January, while small caps did even better as the Russell 2000 rallied close to 6% for its best month since September of last year. With small caps doing so well, a number of lesser-known stocks posted huge gains. In the S&P 1500 alone, 93 stocks were up over 20% in May, while 25 stocks were up over 35%. The table below lists those 25 stocks that rallied more than 35%, and looking through the names, we wouldn’t fault you for not being familiar with most, if not all of them. Just to illustrate, the rightmost column below shows how much each of the top performing stocks listed below gained in market cap during the month. Of these, just five saw a market cap increase of more than $1 billion, and the average increase of the 25 stocks was just $538 million. When a stock rallies 40% or 50% and sees its market cap increase by just a couple of hundred million, you know it’s not a very big company. Collectively, these 25 names saw their market caps increase by $13.5 billion. Looking at performance another way. The table below shows the fifteen stocks in the S&P 1500 that saw their market cap increase by more than $10 billion during the month of May. Topping the list of winners was Apple (AAPL) with a market cap gain of just under $80 billion, and rounding out the top three were Facebook (FB) and Alphabet (GOOGL) which both saw their market caps increase by over $50 billion. On a combined basis, the fifteen companies listed below were up a rather pedestrian 10.5%, but in terms of market cap, they collectively gained just under $400 billion, or 30 times the gain of the 25 biggest percentage movers in the S&P 1500! All or Nothing Days on the Comeback May 30, 2018 For those unfamiliar with the term, we consider an “all or nothing day” to be one where the S&P 500’s net daily A/D (advance/decline) reading is greater than +/-400. Throughout the financial crisis and most of the current bull market, the frequency of all or nothing days increased substantially relative to the years before. The reason for the increase was a one-two punch of an easy Fed and ETFs. As far as the Fed is concerned, easy money and low-interest rates increased the attractiveness of equities relative to other asset classes. More importantly, though, ETFs provided an easy vehicle for investors to gain exposure to stocks while minimizing company-specific risk. The result was an environment of a rising tide lifting all boats and vice versa, and the chart below says it all. From 1990 through 2005, there were just two years where the S&P 500 saw a double-digit number of all or nothing days, but from 2006 through 2017, their frequency exploded and there wasn’t a single year where there were less than ten all or nothing days. In 2017, though, all or nothing days fell by the wayside as there were just three such days in the entire year. One reason for the lack of extreme single-day breadth readings was that volatility was low, so there simply were not a lot of days where the S&P 500 was up or down 1%. In addition to that, 2017 was also a very weak year for Energy and stocks in the Consumer Discretionary sector not named Amazon (AMZN), and because these two sectors on a combined basis account for about a quarter of the names in the index, it was hard to get strong daily breadth readings. This year, however, all or nothing days are back in a big way. Through the first five months of the year, there have already been 12 such days, which puts the index on pace for 29 on the year. If that were to occur it would be the largest number of all or nothing days in a single year since 2015 when there were 38.
Stock Market Analysis Video for June 1st 2018 Video from AlphaTrends Brian Shannon ShadowTrader Video Weekly 6.3.18 Video from ShadowTrader Peter Reznicek (VIDEO NOT YET UP!)
Here are the current major indices pullback/correction levels from ATHs as of week ending 6.1.18- 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 6.4.18 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 6.4.18 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 6.5.18 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 6.5.18 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 6.6.18 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 6.6.18 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 6.7.18 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 6.7.18 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 6.8.18 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 6.8.18 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 (6/4) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (6/4-6/8) <-- 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- ($YY $PANW $AVGO $DVMT $SIG $THO $OKTA $FIVE $DLTH $CLDR $HDS $AMBA $NAV $HQY $SJM $KNOP $COUP $FCEL $MTN $GWRE $HOME $OLLI $FRAN $GIIi $CPST $GCO $CSWC $VRA $FGP $ASNA $HLNE $NX $ROAD $MDB $SFIX $COO $SCWX $UNFI $SEAC $NCS $ZUMZ) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning June 4th, 2018 <-- click there to view!
nasdaq not too far off from ATHs ... transports not doing too shabby either. spx and dj30 still have some work to do, but i think it's at least a little encouraging seeing small caps and tech leading the charge higher.
Techs definitely doing well, looks like stocks like AAPL, AMZN, MSFT, NVDA, and BABA, etc are all hitting new ATHs today
IBB trying to push through this resistance line. I don't seem to be catching any hype off of the ASCO conference so far. Weekly chart: Tomorrow will be an interesting day; do we get a breakout to new ATH in Nasdaq, or do we reach a double top? At least we're hanging around today.
MRK having a nice day, I think I read it somewhere that they released some good data in the ASCO With so many mega cap tech stocks hitting new ATHs, I think we are more likely to see new ATH for Nasdaq in the near future than a double top, I guess we will see
Just keeping the conversation going. Agree that we will see what happens. Prices have been drifting up, as earnings have been going up. But when a big amount of volume wants to trade (institutions), they have to take lower prices. MSFT, the big weekly volume candles are red, the green candles are dojis AMZN same thing AAPL is a solid one, but look at all the gaps (feel like I'm looking at a foreign share like RYAAY or VEDL with all the discontinuities). It could use a pullback before going higher. Solar getting run over bigly today, DQ, FSLR, CSIQ, etc.
The “PowerShares” Name Is No More For example, the PowerShares QQQ Trust (QQQ), its largest ETF with assets of more than $67 billion, is now called the Invesco QQQ Trust. https://www.fa-mag.com/news/the--powershares--name-is-no-more-39023.html Had to email my broker today because I couldn't find my shares of QQQ in my account, they explained to me that the name change of those ETFs is the reason why I can't see my shares for now
Howard Schultz, architect of modern Starbucks, to step down as executive chair and from the board https://www.cnbc.com/2018/06/04/how...wn-as-executive-chair-and-from-the-board.html Could be a tough day for shareholders for SBUX tomorrow, especially the stock performance hasn't been great ever since Howard Schultz stepped down from his CEO role
