Welcome Stockaholics to the trading week of September 16th! This past week saw the following moves in the S&P: Major Indices End of Week: Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday 8:30 a.m. Empire State manufacturing Tuesday Fed begins two-day meeting 8:30 a.m. Business leaders’ survey 9:15 a.m. Industrial production 9:15 a.m. Capacity utilization 10:00 a.m. NAHB survey 4:00 p.m. TIC data Wednesday 8:30 a.m. Housing starts 2:00 p.m. Fed decision 2:30 p.m. Fed’s Powell holds press conference Thursday 8:30 a.m. Initial claims 8:30 a.m. Philadelphia manufacturing survey 8:30 a.m. Current account 10:00 a.m. Existing home sales 10:00 a.m. Leading index Friday 11:20 a.m. Boston Fed President Eric Rosengren at Stern School of Business conference 2:00 p.m. Dallas Fed President Robert Kaplan at Community Forum hosted by the Federal Reserve Bank
Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown Quite a week... The biggest quant quake since 2009 (and 2002) Source: Bloomberg And factor dispersion collapsed... h/t Michael Krause And the antithesis of the momo massacre, value had its best week on record... Source: Bloomberg And relative to one another, it was a bloodbath... Source: Bloomberg And linked to this destruction, 30Y yields (amid record issuance) soared a stunning 33bps this week - second biggest yield spike since 2009... Source: Bloomberg ...while Treasuries & Momentum stocks maintain a perfectly reasonable ~90% correlation. pic.twitter.com/fLN9i4EALc — Monday Morning Macro (@MacroMorning) September 13, 2019 But apart from that - global stocks rallied. China ended higher... Source: Bloomberg Europe soared... Source: Bloomberg And US equities surged led by Trannies and Small Caps, each of which was panic-bid at every day's open. The Dow is up 8 days in a row. Nasdaq underperformed on the week... That is the best week for Small Caps since Dec 2016 (and best for Trannies since Dec 2017) Very narrow range in Dow futs in the day session (having tried and failed to break to new highs numerous times)... The driver of the Trannies/Small Caps surge was a huge short-squeeze... Source: Bloomberg The biggest weekly squeeze since Trump's election... Source: Bloomberg September has seen a massive shift into cyclical stocks... Source: Bloomberg Bank stocks soared this week (as rates rose and the curve steepened)... Source: Bloomberg ...but note below they are merely back at a critical level of resistance... Source: Bloomberg The week was an utter bloodbath for bondholders (yields are up 8 days in a row)... Source: Bloomberg Just as the start of August sparked a panic-buying period for bonds, so September has seemingly sparked the exact opposite with a huge retracement so far... Source: Bloomberg The 10Y Yield is testing critical technical levels... Source: Bloomberg Some might argue the 10Y has a long way to go... Source: Bloomberg But don't listen to Jamie Dimon: In 2018, he predicts 10Y yields will hit 4%, 10Y yield drops to all time low. In 2019, he says JPM preparing for 0% rates on 10Y, 10Y yield soars most in years. Meanwhile, elsewhere in bond land, that 100-year maturity Austrian bond (which was up 85% YTD, is now in a bear market, down 21% from the highs)... Source: Bloomberg The US yield curve (3m10Y) remains inverted but had the biggest weekly steepening since June 2013... Source: Bloomberg The Dollar slipped lower the second week in a row, testing one-month lows... Source: Bloomberg Cable soared this week - its best since May - as BoJo faced defeat and a no-deal brexit was believed to be less likely... Source: Bloomberg Offshore Yuan ended the week stronger than the Yuan fix Source: Bloomberg This is the strongest offshore yuan has been relative to the fix since Dec 2018... Source: Bloomberg Yuan appears to have caught up to Bitcoin's stability... Source: Bloomberg Cryptos were mixed with Bitcoin down on the week and Altcoins up led by Ethereum... Source: Bloomberg But Bitcoin held above $10,000 for now... Source: Bloomberg Oil had a volatile week as copper surged but PMs got pummeled today (most notably silver)... Source: Bloomberg Soft Commodities soared 5.2% this week, its best rally since May and snapping 10 straight losses in what was the longest losing streak since at least 1991. Source: Bloomberg With the surge in rates this week, the volume of global negative-yielding debt tumbled, and gold tracked it lower... Source: Bloomberg But it was silver that was monkeyhammered most... Smashing Gold/Silver dramatically higher this week... Source: Bloomberg Finally, straight from the WTF world we live in, Greek 10Y Yields are now below US 10Y Yields for the first time since 2007... Source: Bloomberg And the market is starting to ease off its pressure on The Fed as it now prices in less than 2 rate-cuts by year-end (from more than 3 in July)... Source: Bloomberg
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2019- S&P sectors for the past week-
Long-Term Treasury ETF (TLT) Has 2nd Biggest Weekly Drop Ever Fri, Sep 13, 2019 Outside of equities, we saw a massive move higher in Treasury yields this week and a massive drop in Treasury bond prices. For the 20+ year Treasury ETF (TLT), this week's 6.34% drop was its second worst week on record since it began trading back in 2002. Below is a look at TLT's historical weekly percentage change, and we also show how TLT has performed in the weeks and months following one-week drops of more than 5% like we saw this week. As shown in the table, TLT has normally continued lower for a while following big down weeks. S&P 500 Nearing ATHs But Individual Sectors Not So Much Fri, Sep 13, 2019 The past week has been a solid run for the US equity market as a whole. The S&P 500 continues to edge ever closer to prior all-time highs; opening today within half a percent of this level. As shown in the chart below, on average across all sectors, though, it is a little bit less optimistic. The average sector is still 6.5% below record highs. Excluding energy, which is by far the furthest (in terms of price and time) from its all-time high, the average across sectors jumps up to 3.6%. Consumer Staples and Utilities are the only sectors within 1% of their highs while the Tech sector is not far behind only 1.5% away. Betting Markets and the Election Fri, Sep 13, 2019 One way to keep track of the evolving Presidential primaries and general election news is the website electionbettingodds.com which shows what the betting market is predicting for upcoming election outcomes. In the charts below, we show the current probabilities of a primary and general election win for each of the various candidates (officially announced and otherwise) with a 1% or higher chance of winning. Elizabeth Warren now has a commanding lead in the Democrats' primary with a 34.9% chance of victory with Biden and Sanders in second and third. Where things get more interesting is to figure out which candidates have the best chance of winning the general election assuming they win their primary. For example, President Trump's odds of winning his primary are 88.1%, but his odds of winning the general election for the Presidency are priced at 43.7%. By dividing that 43.7% by the 88.1% chance of primary victory we can get to a 49.6% general election pricing assuming the candidate wins their primary. This conditional probability probably shouldn't be taken too seriously, but it's got some interesting results. Among candidates polling over 5%, Beto O'Rourke has the highest odds (80%) of a general election win if he takes the primary while other Democratic hopefuls Andrew Yang and Bernie Sanders are priced at 60%+ odds. Biden's general election odds are at 55% if he wins the primary, while Warren -- the current front runner -- is at 49.9%. Notably, although Trump is close at 49.6%, no Republican has a conditional priced probability over 50% to win the general. All of that said, these conditional relationships can be very unstable and are complicated to arbitrage, so we probably shouldn't place too much faith in the detail of their message, but it's still interesting to see that markets are implicitly optimistic about the electability of a candidate like Sanders or Yang relative to more mainstream candidates like Warren, Harris, or Biden. Copper Unconsolidated Fri, Sep 13, 2019 In last night's Closer, we noted the recent price action of copper. Over the past several months, copper had been consistently moving lower in a solid downtrend, but that downtrend has been broken this week. Finishing up about 1% in yesterday's session, copper had its first close above resistance which would suggest a further move higher. We're seeing additional gains today as the commodity continues to break out. Over the next few weeks, copper bulls will look for a series of higher highs and higher lows that would eventually form a new uptrend. best and WORST S&P 1500 Stocks Since 9/6 Thu, Sep 12, 2019 This week has been all about little is big and big is little in terms of stock performance. Take the lists of best and worst performing S&P 1500 stocks since last Friday's close. The first table below shows the 20 best performing S&P 1500 stocks since the close last Friday. The fact that there are more than 20 stocks in the S&P 1500 that are up over 20% already this week is notable in itself. Even crazier, though, is that when you look at the share prices of these stocks, all but seven have current share prices of less than $5 per share even after their gains this week, and the average share price of the 20 stocks listed is just $7.42. Also, as we noted in an earlier post, it's not as if there are tons of stocks in the S&P 1500 trading below $5 per share. Heading into today, there were only 55 and 54 of them were up on the week. Turning to the list of losers so far this week, while there are more than 20 stocks that are up over 20%, not a single stock in the index is down 20% and only eight are down more than 10%. Besides the fact that the stocks listed below are down so far this week and the ones above are up, the other major and pretty consistent difference between the two lists is their share prices. As of today, the average price of the 20 biggest losers so far this week is $135.74 which is more than 18 times the average share price of the biggest week to date winners. Throw It All Out the Window Thu, Sep 12, 2019 It's time to throw all those financial "mumbo jumbo" ratios out the window. That's right. You can take your P/E, P/B, P/S ratios and send them out packing with EV/EBITDA and the PEG ratio. While you're at it, why don't you free up some space and toss out all those finance textbooks you bought in college and grad school. None of it matters. At least not this week where making money in the market has been as simple as "buy low and sell high." Through yesterday's close, the S&P 1500, which is comprised of large-caps (S&P 500), mid-caps (S&P 400), and small-caps (S&P 600), was up just under 1% on the week. The average week to date performance of individual stocks in the index, however, was a much more impressive gain of 5%. By far the biggest gains have come from the stocks with the lowest share prices. Coming into the week, there were 55 stocks in the S&P 1500 that had share prices of less than $5, and through Wednesday's close, they were up an average of 21% with 54 of 55 in the black. 21%!!!! Coming into today, there were also seven stocks in the S&P 1500 that were already up over 40% this week, and guess what? They all came into the week with share prices below $5. Looking at the performance of individual stocks this week shows that share prices appear to have been a key driver of performance. In the chart below, we grouped stocks in the S&P 1500 based on their share prices as of last Friday and then calculated the average performance of the stocks in each group so far this week (through Wednesday's close). While stocks with share prices of less than $5 per share were up an average of 20.8%, the performance of stocks priced between $5 and $10 per share were up a still impressive 10.9%. What's even crazier about this chart is the fact that as you move out to the right (higher share prices), average performance consistently weakens to the point where stocks with high share prices ($100+) have only gained an average of 0.1% so far this week. Who needs Alphabet (GOOGL), Amazon (AMAZN) and Chipotle (CMG) when you could have had JC Penney (JCP), Dean Foods (DF), or Mallinckrodt (MNK). If these high priced stocks know what's good for them, they better start announcing 10-1 splits pronto! (That was a joke.) In all seriousness, the performance numbers listed below further illustrate this week's massive rotation out of momentum strategies, where stocks and sectors that had been leading have been sold off while those that had lagged or been written off for dead have seen some buying interest or at least an easing of selling pressure. All the textbooks and financial ratios in the world may provide comfort to analysts and investors, but they don't help at all when the momentum tide turns. Small Cap Surge Thu, Sep 12, 2019 Small caps have been serial underperformers versus the large-cap S&P 500 over the last 12+ months, but they're having their day in the sun this week. Not only has the small-cap Russell 2,000 risen more than 1% for three consecutive trading days to start the week, but the index has also outperformed the S&P 500 by more than one percentage point on each of the last three days. If this is the start of a longer-term small cap resurgence, there is certainly a lot of runway left. Below is a chart of the ratio between the S&P 500 and the Russell 2,000 over the last 15 years. When the line is rising, the S&P is outperforming the Russell. When the line is falling, the Russell is outperforming the S&P. As you can see in the chart, the S&P has been outperforming the Russell for the last year, and the ratio got extended to the very top of its 15-year range at the start of September. Since peaking earlier this month, however, the ratio has fallen dramatically as small caps have started to outperform. Even after the recent small-cap outperformance, the ratio remains well above its long-term average. Time For Gold To Shine? September 11, 2019 On this 18th anniversary of 9/11, our thoughts go out to everyone impacted on that fateful day. “The higher the base, the higher in space,” is an old technical analysis saying. Gold is up 18% year-to-date (as of 9/10/2019), poised for its best year since 2010, when it gained 30%. We see many reasons why this rally may have legs. Last year’s action was rare: The S&P 500 Index, 10-year U.S. Treasuries, and gold were all lower. Going back to 1971, when gold was officially removed from the gold standard, last year was the first year that all three assets were lower in a calendar year. Now in 2019, all three assets are up significantly, quite a difference from last year! Gold and stocks have trended the same way: Since 1980, stocks and gold both have risen in 19 of those 39 years, and both have fallen in only four years. Somewhat surprisingly, both were up more than 10% in eight of those years. Gold might be viewed as “defensive,” but history shows there can be times when both gold and stocks have had nice gains together. “Gold is breaking out to new highs after doing nothing for years,” explained LPL Financial Senior Market Strategist Ryan Detrick. “Concerns over the global slowdown, $17 trillion in negative yielding debt, inverted yield curves, and central banks stepping up their gold purchases have all pushed the yellow metal out of a picture-perfect base.” Technicals support a rally: As shown in the LPL Chart of the Day, gold completed a nice-looking six-year saucer bottom and broke out above previous resistance. As the quote at the start of the blog noted, when things base for years, the potential move can be quite explosive. A well-deserved pullback may present an opportunity for suitable investors to add exposure in appropriate strategies. S&P 500 up 13 of last 16 September option expiration weeks September’s option expiration week is up 62.2% of the time for S&P 500 since 1982. DJIA and NASDAQ have slightly weaker track records with gains 56.8% of the time and 59.5% of the time respectively. However, the week has suffered several sizable losses. The worst loss followed the September 11 terrorist attacks in 2001. In the last sixteen years, S&P 500 and NASDAQ are tied for best record during September’s option expiration week, up thirteen times. Friday had been firm with all three indices advancing every year 2004 to 2011, but S&P 500 has been down six of the last seven since.
Here are the current major indices pullback/correction levels from ATHs as of week ending 9.13.19- Here is also the pullback/correction levels from current prices- ...and here are the rally levels from current prices-
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 (9/16) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (9/16-9/20) <-- click there to cast your weekly market vote and stock picks! Stockaholics Weekly T/A Charting Challenge (9/16-9/20) <-- 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!
Stock Market Analysis Video for September 13th, 2019 Video from AlphaTrends Brian Shannon (VIDEO NOT YET POSTED!) ShadowTrader Video Weekly 9.15.19 Video from ShadowTrader Peter Reznicek
Here is a look at this upcoming week's Global Economic & Policy Calendar- (GLOBAL ECONOMIC AND POLICY CALENDAR NOT YET POSTED!)
Here are the most anticipated Earnings Releases for this upcoming trading week ahead. ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 9.16.19 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 9.16.19 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! NONE. Tuesday 9.17.19 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 9.17.19 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 9.18.19 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 9.18.19 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 9.19.19 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 9.19.19 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 9.20.19 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! NONE. Friday 9.20.19 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
And finally here is the most anticipated earnings calendar for this upcoming trading week ahead- ($ADBE $FDX $GIS $CHWY $BBCP $SOL $DRI $CBRL $APOG $MLHR $SANW $SCS $HX $HHR $BYSI $SCHL $MREO) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning September 16th, 2019 <-- click there to view!
Pretty ridiculous move for black gold today post-Saudi attack. Don’t know if I’ve ever remember seeing that large of a one day spike in the years I’ve been in this gig. Maybe someone can confirm that but I don’t think we even saw this big of a 1 day move during the Arab Spring in 2011?
Man I definitely can’t think of when was the last time crude moving 10% or more for the day, I was thinking maybe during the financial crisis in 2008/2009 but maybe it happened in 2011
Something def smells fishy. Saudis were bitching about the falling price of crude, and all of a sudden.... Also, they're military spending is 3rd highest among nations, so tell me how they missed the attack?
Saudi Arabia has ‘a great deal of explaining to do’ on how its oil assets were attacked, says former US diplomat https://www.cnbc.com/2019/09/17/sau...abqaiq-were-attacked-says-ex-us-diplomat.html
