The Long Term Investor

This is what I was talking about with the FED in the above post.

Powell: ‘Premature’ to conclude Fed rate hikes are over or ‘speculate’ when cuts could begin

https://finance.yahoo.com/news/powe...peculate-when-cuts-could-begin-160003194.html

 

With the Ten Year Treasury yield back to dropping.....substantially.....at 4.276% we are seeing a market day today where there is absolutely ZERO news or market moving events.

This tends to amplify the FED comments. BUT....have no doubt.....the FED is history. The ONLY power they still have over investors and the markets is the power investors and the markets give them by reacting to their continued blather. If people simply ignored them.....they would have no power at this point where it is unlikely they will raise rates again.

Of course the market reaction today.....is solely.....the short term traders making money off the news headlines.....which they try to (legally) manipulate to push their trading.

As a long term investor......IGNORE it all and go about your day to day life.

 

SO....since I started doing some posting.....the markets have turned nearly positive. The...."nearly"...is due to the NASDAQ still being slightly in the red.

We need to make a push for a positive Friday close.....after all it is the first day of December.....and the holidays are on the horizan.

 

Looks like we have a little mid-day rally going on right now. Lets keep it going till the close. I am currently in the green......moderately. My down stocks are MSFT and GOOGL. Everything else UP at the moment.

 

Well at least I ended the day with a moderate gain. This was in spite of MSFT and GOOGL being down and NVDA basically being flat at (-0.01) today. I also got beat by the SP500 today by 0.36%.

 

Ok for the weekly summary I am now using info from the WSJ/Markets page. Here is the week that was.

DOW year to date +9.35%
DOW five days +2.42

SP500 year to date +19.67%
SP500 five days +0.77%

NASDAQ 100 year to date +46.23%
NASDAQ 100 five days +0.10%

NASDAQ year to date +36.67%
NASDAQ five days +0.38%

RUSSELL year to date +5.78%
RUSSELL five days +3.05%

After this week my entire portfolio is at +39.85% year to date. At the end of last Friday it was at +40.27% year to date. So I went down by 0.42% this week.

A dull and lingering week this week. BUT....today showed some strength and positive BIAS in the markets. So from here we go:

ONWARD AND UPWARD.

 

HAVE A GREAT WEEKEND EVERYONE. GO OUT AND GET THAT HOLIDAY SHOPPING STARTED AND STIMULATE THE ECONOMY. GET THOSE DECORATIONS UP FOR THE KIDS.

 

We did good today and last month.

Stock market news today: S&P 500 hits new 2023 closing high as stocks rise for 5th straight week

https://finance.yahoo.com/news/stoc...cks-rise-for-5th-straight-week-210224678.html

(BOLD is my opinion OR what I consider important content)

"US stocks rose Friday afternoon, building on a stellar November, even as investors digested a warning from Federal Reserve Chair Jerome Powell that it would be "premature" to conclude that Fed rate hikes are over or "speculate" when cuts could begin.

The S&P 500 (^GSPC) increased about 0.6% to a new 2023 closing high, while the Dow Jones Industrial Average (^DJI) rose roughly 0.8% or nearly 300 points. The tech-heavy Nasdaq Composite (^IXIC) advanced 0.5%. All three indexes closed positive for a fifth straight week.

Stocks soared in November to post their best monthly performance since 2022 as conviction that the Fed was done with rate hikes morphed into growing hopes for rate cuts before the summer.

"It's one of the best months we've seen in the last decade," eToro US investment analyst Callie Cox told Yahoo Finance Live. "And I think it shows us how a lot of investors were caught off guard by the Fed's flexible stance after the Nov. 1 meeting."

Powell spoke Friday after October data showed inflation cooled to its lowest levels since 2021. Despite his pushback against talk of rate cuts, markets moved higher from earlier losses as he hinted the central bank could be done with rate hikes.

Meanwhile, oil prices lost more ground after OPEC+'s additional output curbs failed to convince skeptical investors. WTI crude futures (CL=F) traded just above $74 a barrel, down over 2%, while Brent (BZ=F) futures were below $83."

MY COMMENT

It seemed like a very DULL week but at least it was.....FIVE IN A ROW.....positive weeks for the big three averages. I would bet a lot of people do not even realize this is happening. Another continuation of the "stealth" rally to year end.

I can remember not too long ago when the WSJ had a big headline and front page story about the DOW hitting 36,000. It is now nicely back above 36,000 currently at 36,245.

We are close to the ALL TIME HIGH for the DOW at 36,799. That was at the close on January 4, 2022. ONLY.......22 months ago.

Can you believe it......the DOW has now basically ERASED all of the brutal year 2022 and is now on the verge of a new all time high......all in only 22 months. Quite a trip down and back up. This is why you dont worry about short term market action.....it is insanity.

 

Bad news for Mr Powell today....as his attempt to Trash TALK the markets only impacted them for the first few hours. After that the markets just said....screw it....we are going up.

 

LOL....thanks Zukodany. I will look into PLTR....but no promises. I do not care what it does over a few weeks....although....30-40% in a few short weeks would be great for those that hold it. I would need to see it as a long term holding.

I know nothing about it....and will check it out.

 

Hey Zukodany. I looked at some info for PLTR....analysis, fundamentals, earnings, etc. I saw all the positive information and analysis of their recent earnings and achieving profitability much sooner than expected with four quarters now. I also saw the various critiques of their fundamentals. They are not a young company.....over 20 years old. But in terms of being a public company are very young. Looks like a big milestone for them will be entry into the SP500 at some time in the.......near?.....future.

But the bottom line for me.....I dont like their reliance on government contracts and the.......potential.....that they are involved in helping the government spy agencies and intelligence agencies gather information on citizens. I guess it is the LIBERTARIAN in me. I am really not interested in them as a company that is dependent on government and government contracts.

Although their private business has significantly grown....the number of private customers they have is really very small at this point....even though it has been growing lately. In terms of private business.....and AI.....I am not sure they will be able to compete with the TECH giants over the long run.

At this point they are not the sort of ICONIC, BIG CAP, WORLD WIDE MARKET LEADER, etc, etc, company that I like to focus on. Perhaps they will grow into this over the next few years.....who knows. If they do there will be time to reconsider them.

With the work that they are doing for the US government and the UK.....I am not sure how much of their actual work is really visible to the public.

Bottom line they are just not for me.....at this time. If they continue to grow and turn into more of a private business compared to sort of a.........semi-NGO......I will consider them in the future.

 

I like this little article.

FOMO' creeps into markets as stocks post best month in a year

https://finance.yahoo.com/news/fomo...ocks-post-best-month-in-a-year-183950006.html

"BOLD is my opinion OR what I consider important content)

"Stocks that got slammed amid fears of higher-for-longer interest rates caught a second wind during the roaring November market rally.

The S&P regional bank index (KRE) rose more than 16% during the month, including a more than 2% gain on Wednesday. Cathie Wood's flagship Ark Innovation ETF (ARKK) gained more than 34%. Meme stocks are soaring too, with the broad Roundhill Meme ETF (MEME) rising more than 20% in November and meme stock favorite GameStop moving up over 20% on Wednesday alone.

The small cap Russell 2000 Index (^RUT), which had been largely avoided due to fears that high interest rates would sink small companies, gained more than 9% in the month.

"Traders have decided that even though it’s still earning nearly 5%, cash is trash compared to quick profits in a wide variety of risk assets," Interactive Brokers chief strategist Steve Sosnick wrote in a research note on Wednesday.

Sosnick adds that the root of what he described as a fear of missing out, or "FOMO" rally, is the "expectation that rates will be coming down, and that is indeed a solid reason for a rise in risk assets."

Fears of another Fed rate hike had weighed on the broader indexes and particularly on tech stocks, between the Fed's September meeting and the one on Nov. 1.

When the S&P 500 (^GSPC) bottomed in late October, institutional investors were caught "flat-footed," eToro US investment analyst Callie Cox told Yahoo Finance. According to a measure by the National Association of Active Investment Managers, investors were their least exposed to equities in more than a year.

So as signs of cooling inflation built a case for investors to believe the Fed may not only be done hiking but could even cut rates soon, they piled into interest rate-sensitive sectors throughout last month in an effort to "performance chase," Cox said. Real Estate (XLRE) and Technology (XLK) gained more than 12% in November while Financials (XLF) and Consumer Discretionary (XLY) rose more than 10%.

"Many [institutional investors] are rushing into these high-duration sectors, which is powering the rate cut trade, and that could last until the end of the year," Cox said.

Now with that active managers index at its highest level since the top of the AI-driven rally in the summer, the key question for investors will be if markets have too aggressively priced in rate cuts and if investors are overall too bullish on stocks despite myriad headwinds headed into 2024.

For its part, the Federal Reserve has attempted to temper expectations about rate cuts.

"It would be premature to conclude with confidence that we have achieved a sufficiently restrictive stance, or to speculate on when policy might ease," Fed Chair Jerome Powell said Friday in prepared remarks at Spelman College in Atlanta.

Invesco chief global market strategist Kristina Hooper told Yahoo Finance on Thursday that the Fed is "incentivized" to talk markets down so financial conditions don't ease too far and prove to be an upside risk to inflation. But that doesn't mean investors will be wrong.

"The market is excited," Hooper said when discussing if markets had gone too far during the November rally. "But I don't disagree about the [rate] cut. I think we're likely to see that. Very likely to see that ... We probably will see some movement down in markets, some tamping down in markets. But the reality is that inflation is coming down."

Other strategists agree that stocks haven't gotten over their skis yet, either. Bank of America noted in a new research note on Friday that investor sentiment, as tracked by its Sell Side Indicator, ticked up in November amid the rally but remains"more bearish than bullish."

"Despite growing expectations for a soft landing, we are still far from a market environment dominated by high conviction and euphoria," Bank of America's head of US equity & quantitative strategy Savita Subramanian wrote.

For Cox, key indicators within the market aren't flashing red yet. For example, Bitcoin (BTC-USD) has soared about 50% over the past month, but Cox hasn't yet seen any aggressive moves into alternative cryptocurrencies, like the 2021 rush into Dogecoin (DOGE-USD) and other alternative coins with limited practical use cases.

"Speculation is never going to go away," Cox said. "It's just going to happen in degrees. And I think the speculative trading we see these days is a shell of what we saw two years ago ... Investors aren't just closing their eyes and buying. They're really thinking about what can survive in what is still a treacherous environment. Rates are still high. There's still a lot of uncertainty out there."

MY COMMENT

Many BULLISH items above.

First of which is the FOMO atmosphere. As long term investor I love it when the herd suddenly turns and runs toward the markets. This is one way to get explosive gains.

At the same time....skepticism is still the name of the game and there is still much BEARISH sentiment. A perfect contrary indicator for the current BULL market and investors.

I LOVE that Active Investment Managers were their least exposed to stocks in a year....or more. These are the professionals......well......"so called" professionals. No doubt they will now be under extreme pressure to window dress and get their clients into the markets.

At the same time....the little retail investors.....are rational and realistic in their actions. We are in a real sweet spot for stocks right now in general. The FED is done, the economic data is good for investors, we have finally recovered from the pandemic distortions, and there is a huge amount of money yet to come into the markets. There are many positive contrary indicators.....and....we are now in what has historically been the best month of the year for investors.

 

I also like this little article...to continue the above.

Tax-loss selling, 'Santa rally' could sway U.S. stocks after November melt-up

https://finance.yahoo.com/news/tax-loss-selling-santa-rally-000323949.html

(BOLD is my opinion OR what I consider important content)

"NEW YORK(Reuters) - As U.S. stocks sit on hefty gains at the close of a rollercoaster year, investors are eyeing factors that could sway equities in the remaining weeks of 2023, including tax loss selling and the so-called Santa Claus rally.

The key catalyst for stocks will likely continue to be the expected trajectory of the Federal Reserve's monetary policy. Evidence of cooling economic growth has fueled bets that the U.S. central bank could begin cutting rates as early as the first half of 2024, sparking a rally that has boosted the S&P 500 19.6% year-to-date and taken the index to a fresh closing high for the yearon Friday.

At the same time, seasonal trends have been particularly strong this year. In September, historically the weakest month for stocks, the S&P 500 fell nearly 5%. Stocks swung wildly in October, a month noted for its volatility. The S&P 500 gained nearly 9% gain in November, historically a strong month for the index.

"We've had a solid year, but history shows that December can sometimes move to its own beat," said Sam Stovall, chief investment strategist at CFRA Research in New York.

Investors next week will be watching U.S. employment data, due out on Dec. 8, to see whether economic growth is continuing to level off.

Overall, December has been the second-best month for the S&P 500, with the index up an average of 1.54% for the month since 1945, according to CFRA. It is also the month most likely to post a gain, with the index rising 77% of the time, the firm's data showed.

Research from LPL Financial showed that the second half of December tends to outshine the first part of the month. The S&P 500 has gained an average of 1.4% in the second half of December in so-called Santa Claus rallies, compared with a 0.1% gain in the first half, according to LPL's analysis of market moves going back to 1950.

Stocks that have not performed well, however, may face additional pressure in December from tax loss selling, as investors get rid of losers to lock in write-offs before year-end. If history is any guide, some of those shares may rebound later in the month and into January as investors return to undervalued names, analysts said.

Since 1986, stocks that were down 10% or more between January and the end of October have beaten the S&P 500 by an average of 1.9% over the next three months, according to BofA Global Research. PayPal Holdings, CVS Health, and Kraft Heinz Co are among the stocks the bank recommends buying for a tax-related bounce, BofA noted in a late October report.

"The market advance has been extraordinarily narrow this year, and there's reason to believe that some sectors and stocks will really take it on the chin until they get some relief in January," said Sameer Samana, senior global market strategist at the Wells Fargo Investment Institute.

Despite the market's hefty year-to-date rise, investment portfolios are likely to have plenty of underperforming stocks. Nearly 72% of the S&P 500's gain has been driven by a cluster of megacap stocks such as Apple, Tesla and Nvidia, which have an outsized weighting in the index, data from S&P Dow Jones Indices showed.

Many other names have languished: The equal-weighted S&P 500, whose performance is not skewed by big tech and growth stocks, is up around 6% in 2023.

Some worry that investor over-exuberance may have already set in after November's big rally, which spurred huge moves in some of the market's more speculative names.

Streaming service company Roku soared 75% in November, for instance, while cryptocurrency firm Coinbase Global climbed 62% and Cathie Wood's ARK Innovation Fund was up 31%, its best performance of any month in the last five years.

Michael Hartnett, chief investment strategist at BofA Global Research, said in a Friday note that the firm's contrarian Bull & Bear indicator - which assesses factors such as hedge fund positioning, equity flows and bond flows - had moved out of the "buy" zone for the first time since mid-October.

"If you caught it, no need to chase it," he wrote of the rally."

MY COMMENT

The current BULL MARKET RALLY that started way back in July of 2022....has continued to be disrespected ever since. I see nothing to indicate outsize exuberance.

Everything that we saw with earnings being HUGE BEATS shows that this market has a long way to go. In fact earnings have been totally ignored in favor of the usual doom and gloom.

My view.....there is good potential for another month like November.....in December. In other words a BIG Santa Clause rally.

Of course I dont try to trade or play such short term events. But as a long term investor.....I will passively take anything I can get......free money.

 

The good news that is also ignored.

US company earnings set for biggest quarterly gain in over a year

https://www.reuters.com/markets/us/...-biggest-quarterly-gain-over-year-2023-11-10/

"U.S. companies are set for their biggest year-over-year gain in quarterly earnings since the second quarter of 2022 after a high percentage of S&P 500 companies beat Wall Street expectations.

With results in from almost all of the S&P 500 (.SPX) companies, overall third-quarter earnings are estimated to have increased 6.3% from the year-ago period, LSEG data showed on Friday.

That is well above the 1.6% third-quarter earnings gain estimated by analysts Oct. 1.

LSEG said that 81.3% of the quarterly reports surpassed analysts' earnings expectations, which is the highest beat rate since the second quarter of 2021......."

MY COMMENT

See article for more.

AND.....of course all the "experts" are now adjusting their forth quarter estimates.....DOWN. Fine with me.....what else is new. Most of these people have been embarrassingly wrong for at least the past 10-14 quarters.

The media has been pushing such WRONG information on earnings.....for so long..... that they now simply ignore them.

 

Have doubts about being a long term fully invested....investor? Here are a couple of anecdotal reports.

Trailer park caretaker surprises his hometown with a gift of $3.8 million, years after another secret millionaire did the same nearby

https://www.cnbc.com/2023/12/02/tra...rises-hometown-with-3point8-million-gift.html

 

BUMMER.

Gifts in the song 'Twelve Days of Christmas' increased 2.7% this year: PNC
Altogether, the gifts totaled $46,730 for 2023, according to PNC

https://www.foxbusiness.com/lifestyle/gifts-song-twelve-days-christmas-increased-2-7-this-year-pnc

"-Partridge in a pear tree at $319.18

-Two turtle doves at $750

-Three French hens at $330

-Four calling birds at $599.96

-Five golden rings at $1,245

-Six geese-a-laying at $780

-Seven swans-a-swimming at $13,125

-Eight maids-a-milking at $58

-Nine ladies dancing at $8,308.12

-10 lords-a-leaping at $14,539.20

-11 pipers piping at $3,207.38

-12 drummers drumming at $3,468.02"

BUT.....I still have HIGH expectations for Santa.