It wasn't a particularly positive week for equities. In fact, it was negative, across the board, ending with a massive selloff on Friday, culminating in the worst week for US stocks since October, 2019.
The better part of the decline came on Friday, after the WHO had issued an international alert on the coronavirus (2019-nCoV) and US stocks soared off lows on Thursday. Reality set in Friday and accounted for 75-80% of the total weekly decline.
As the weekend wore on (this is now Sunday noon in the US, Eastern Time), more reports proved encouraging. The official count from China confirmed 14,380 cases total, and 304 deaths. On Saturday, a death in the Philippines was suggested to have been caused by coronavirus but that has yet to be confirmed. Medical professionals are awaiting further testing. The patient died from pneumonia, but it may have come from normal, seasonal flu.
In the US, there's a better chance of dying from the common flu than the coronavirus, according to the CDC.
Preliminary considerations are suggesting that the spread of the virus is being slowed by China's quarantines and travel restrictions and monitoring around the world and that many reports on social media such as Twitter and Facebook have proven false, misleading or negatively hyperbolic.
Patient Zero, i.e., the first case of the disease to have been reported in the United States (Washington state), became quite ill, was treated intravenously with remdesivir (a drug produced by Gilead Sciences (GILD)) and was recovering.
Also on Friday, Great Britain finally extricated itself from the European Union via what's been known as Brexit, the referendum passed by the British public more than three-and-a-half years ago (June 23, 2016), and President Trump appeared on the way to being acquitted on charges of impeachment by the Senate, which voted 51-49 against calling additional witnesses. A final vote on acquittal or guilt will be held at 4:00 pm ET, Wednesday, February 5.
As frightening as the coronavirus and other news may be, people around the world can take heart in the video below: Nigel Farage's final speech at the European Parliament. As of 11:00 pm January 31, 2020, Britain formally withdrew from the European Union.
At the Close, Friday, January 31, 2020:
Dow Jones Industrial Average: 28,256.03, -603.41 (-2.09%)
NASDAQ: 9,150.94, -148.00 (-1.59%)
S&P 500: 3,225.52, -58.14 (-1.77%)
NYSE: 13,614.10, -247.82 (-1.79%)
For the Week:
Dow: -733.70 (-2.53%)
NASDAQ: -163.98 (-1.76%)
S&P 500: -69.95 (-2.12%)
NYSE: -364.37 (-2.61%)
Showing posts with label Great Britain. Show all posts
Showing posts with label Great Britain. Show all posts
Sunday, February 2, 2020
Friday, December 13, 2019
Britons Vote In Conservatives As Boris Johnson Rides Populist Landslide To Majority
"We broke the deadlock, we've ended the gridlock, we've smashed the roadblock - we did it!"
Those were the words Britain's Boris Johnson used to describe his his Tory party victory in Thursday's UK general election, as the conservative party was swept into power with a commanding majority in the House of Commons, crushing the liberal Labor party and others.
Johnson's resounding message during the campaign was to "get Brexit done," and it appears the path is now clear, nearly four years after the general population voted in a referendum to leave the European Union. With not all of the districts reporting, the conservatives hold 364 seats to Labor's 202. 325 votes are needed for an outright, one-party majority and the Tories have it.
The size of the majority was of a magnitude not seen since the 1980s when Margaret Thatcher ruled over decade of conservatism. Some of the Labor seats that were lost had been voting for liberals since the 1930s. The sweep and scope of the landslide is historic.
Johnson, party leader and Prime Minister, has been pushing for a resolution to the Brexit problem over the past six months and finally was pushed into a general election, a move that eventually backfired on his opponents and has now paved the way for Britain to regain its independence and restrain or reverse the liberal spending and immigration policies that the country so desperately needs.
This election, viewed on a global basis, is an extraordinary victory for conservatives and working-class populism, mush as Donal Trump's election in 2016 was in the United States. The wave of populism just got another boost, sending the worn-out, fear-ridden policies of the left screaming for cover.
Even as the results were being tabulated Thursday night in Great Britain, voices of the losing liberals were heard using words and phrases such as "devastating," "disastrous," and "dangerous for our country," to describe the stunning victory for the right, with the general public sending a loud mandate to fix what's broken and move on.
No doubt, the liberal politicians will moan and wail, just as they have in the United States, but, in the end, the handwriting is on the wall. People want less government intervention into their lives, less meddling, and more positive, clear-headed solutions.
While many in America will have little understanding of the importance of the British elections, they send a clear message and make the case for Trump in a very distinct way.
Here is Johnson's victory speech:
At the Close, Thursday, December 12, 2019
NASDAQ: 8,717.32, +63.27 (+0.73%)
S&P 500: 3,168.57, +26.94 (+0.86%)
NYSE Composite: 13,697.41, +117.48 (+0.87%)
Tuesday, September 10, 2019
Stocks Flat; Britain Should Leave The EU ASAP
Markets - whatever is left of them - seemed to be running on fumes Monday, as no Trump tweets nor economic news were sufficient to move stocks in general either way.
This kind of quiet may be just what investors are seeking: less volatility, less media madness, a more sanguine environment and some degree of security and safety. With all the talk of recession, the past few months have spooked some of the more ardent longs, but the market is still not conducive to short trades in any form.
One could conclude from recent action that stocks will hold their ground and move to new highs, as has been the case throughout the run from 2009 (buy the dip philosophy), and with another 1/4 point rate cut from the Fed a sure thing next week, that is the likely trading strategy for the day-trader and short-termer. Long term investors should be seeking value or growth, best, a combination of the two. With interest rates so low, dividend-yielding stocks with long track records are the safest and surest, plus, many will survive well under difficult conditions, should a recession actually arrive.
Central banks still have control of markets, a condition that may persist for quite a long time. It should serve memory well to reconsider the aftermath of the 2008 crash, wherein central banks coordinated to save everything, even unworthy companies, from default.
This might be a prime time to move from passive to active investing, with individual stocks preferred over ETFs or mutuals. Expect some noisy ups and downs over the next few months, though the next major event is Brexit, with a hard-line, no-deal escape from the EU by Great Britain set for October 31 by Boris Johnson, the most recent Prime Minister of the country.
It's been more than three years since jolly ole' England voted to leave the EU. Parliamentarians and stubborn bureaucrats have delayed the wishes of the people for too long and the wait may soon be over. Anything short of England removing itself from the EU - without onerous conditions - will be very bad for markets. The hyperbole of the media and those on the "remain" side of the issue have played the hysterics card for all it's worth.
Time is up. Populism should prevail in England and the result of leaving the EU, while dramatic, does not have to be traumatic.
At the Close, Monday, September 9, 2019:
Dow Jones Industrial Average: 26,835.51, +38.05 (+0.14%)
NASDAQ: 8,087.44, -15.64 (-0.19%)
S&P 500: 2,978.43, -0.28 (-0.01%)
NYSE Composite: 12,960.72, +27.34 (+0.21%)
This kind of quiet may be just what investors are seeking: less volatility, less media madness, a more sanguine environment and some degree of security and safety. With all the talk of recession, the past few months have spooked some of the more ardent longs, but the market is still not conducive to short trades in any form.
One could conclude from recent action that stocks will hold their ground and move to new highs, as has been the case throughout the run from 2009 (buy the dip philosophy), and with another 1/4 point rate cut from the Fed a sure thing next week, that is the likely trading strategy for the day-trader and short-termer. Long term investors should be seeking value or growth, best, a combination of the two. With interest rates so low, dividend-yielding stocks with long track records are the safest and surest, plus, many will survive well under difficult conditions, should a recession actually arrive.
Central banks still have control of markets, a condition that may persist for quite a long time. It should serve memory well to reconsider the aftermath of the 2008 crash, wherein central banks coordinated to save everything, even unworthy companies, from default.
This might be a prime time to move from passive to active investing, with individual stocks preferred over ETFs or mutuals. Expect some noisy ups and downs over the next few months, though the next major event is Brexit, with a hard-line, no-deal escape from the EU by Great Britain set for October 31 by Boris Johnson, the most recent Prime Minister of the country.
It's been more than three years since jolly ole' England voted to leave the EU. Parliamentarians and stubborn bureaucrats have delayed the wishes of the people for too long and the wait may soon be over. Anything short of England removing itself from the EU - without onerous conditions - will be very bad for markets. The hyperbole of the media and those on the "remain" side of the issue have played the hysterics card for all it's worth.
Time is up. Populism should prevail in England and the result of leaving the EU, while dramatic, does not have to be traumatic.
At the Close, Monday, September 9, 2019:
Dow Jones Industrial Average: 26,835.51, +38.05 (+0.14%)
NASDAQ: 8,087.44, -15.64 (-0.19%)
S&P 500: 2,978.43, -0.28 (-0.01%)
NYSE Composite: 12,960.72, +27.34 (+0.21%)
Thursday, August 15, 2019
Stocks Crumble As Treasury Yield Curve Inverts; 30-year Tumbles Below 2%
It is certainly getting interesting in terms of global economics.
National currencies are in a race to the bottom, and Japan and the EU are winning.
With more than $14 trillion worth of bonds holding negative yields (you get back less than you invested), the world is looking like a place headed for disaster. European and Japanese bonds have the most negative yielding bonds. Their economies are not just heading for a recession, they're diving into depression territory.
There is no growth and that's not to blame on Trump's tariffs. In fact, the tariffs have little to nothing to do with the state of global trade. All economies are slowing. There's entirely too much uncertainty, piled atop too much malinvestment, coupled with an aging demographic, for which to promote any kind of meaningful growth.
By this time next year, expect to see at least six of the major developed nations in recession. The most likely candidates would be Japan, Germany, France, Italy, Spain, and Greece. Notably absent from the list are the US, Australia, Great Britain, and Canada. Since China claims to be still growing, they will admit only to slowing down, to about 3% growth, which might as well be a recession. India, which is not a developed nation (nor is China), is already a basket case.
These recessions will not end easily, and the US, Britain, and Canada will likely recede as well, but not quite as soon as the other nations, mostly European, because Brexit is going to change the dynamic to some degree. The EU is going to lose Britain as a trading partner come October 31. That is a near certainty and long overdue.
The US, Australia, and Canada will sign agreements with Britain to continue trade on a reasonable, fair basis. Europe will be shut out of any such agreement, due to their unwillingness to allow Britain an orderly exit for some three years running. The genii in the EU parliament have made their beds and will have to sleep in them. The populations of the EU countries should rightly riot since EU governance, in conjunction with their national leaders have sold them down the proverbial river via lax immigration standards and horrible economic policies.
In the end - though it may take some time - the EU will dissolve, disintegrate. It may take war, or it may take anger from the Greeks, Spanish, Irish or Italians to tip the EU contract overboard, but it will happen.
For the present, however, the world is focused on stocks and bonds, and stocks are not faring well. Wednesday's disaster was the worst trading day of 2019, rivaling some of the hours of last December.
With a global recession looming, investors may be rushing the exits at various stages over the coming months. Adding to the malaise is the upcoming US elections, whereby strident Democrats seek to unseat Mr. Trump. None have shown the qualities to lead or offer any reasonable path to a stable future. Trump should rightly win in a landslide.
With that, the 30-year bond became the latest victim of upside-down economics and the flight to safety, dipping below 2.00% in yield for the first time EVER. The entire treasury curve is now not only yielding less than two percent, it is inverted, and all of it is yielding lower returns than the effective overnight federal funds rate (2.11%).
We are witnessing the death of fiat money in real time. In the meantime, look for a short-lived relief rally which could extend through the rest of August. Real selling should commence after Labor Day.
At the Close, Wednesday, August 14, 2019:
Dow Jones Industrial Average: 25,479.42, -800.49 (-3.05%)
NASDAQ: 7,773.94, -242.42 (-3.02%)
S&P 500: 2,840.60, -85.72 (-2.93%)
NYSE Composite: 12,368.05, -356.32 (-2.80%)
National currencies are in a race to the bottom, and Japan and the EU are winning.
With more than $14 trillion worth of bonds holding negative yields (you get back less than you invested), the world is looking like a place headed for disaster. European and Japanese bonds have the most negative yielding bonds. Their economies are not just heading for a recession, they're diving into depression territory.
There is no growth and that's not to blame on Trump's tariffs. In fact, the tariffs have little to nothing to do with the state of global trade. All economies are slowing. There's entirely too much uncertainty, piled atop too much malinvestment, coupled with an aging demographic, for which to promote any kind of meaningful growth.
By this time next year, expect to see at least six of the major developed nations in recession. The most likely candidates would be Japan, Germany, France, Italy, Spain, and Greece. Notably absent from the list are the US, Australia, Great Britain, and Canada. Since China claims to be still growing, they will admit only to slowing down, to about 3% growth, which might as well be a recession. India, which is not a developed nation (nor is China), is already a basket case.
These recessions will not end easily, and the US, Britain, and Canada will likely recede as well, but not quite as soon as the other nations, mostly European, because Brexit is going to change the dynamic to some degree. The EU is going to lose Britain as a trading partner come October 31. That is a near certainty and long overdue.
The US, Australia, and Canada will sign agreements with Britain to continue trade on a reasonable, fair basis. Europe will be shut out of any such agreement, due to their unwillingness to allow Britain an orderly exit for some three years running. The genii in the EU parliament have made their beds and will have to sleep in them. The populations of the EU countries should rightly riot since EU governance, in conjunction with their national leaders have sold them down the proverbial river via lax immigration standards and horrible economic policies.
In the end - though it may take some time - the EU will dissolve, disintegrate. It may take war, or it may take anger from the Greeks, Spanish, Irish or Italians to tip the EU contract overboard, but it will happen.
For the present, however, the world is focused on stocks and bonds, and stocks are not faring well. Wednesday's disaster was the worst trading day of 2019, rivaling some of the hours of last December.
With a global recession looming, investors may be rushing the exits at various stages over the coming months. Adding to the malaise is the upcoming US elections, whereby strident Democrats seek to unseat Mr. Trump. None have shown the qualities to lead or offer any reasonable path to a stable future. Trump should rightly win in a landslide.
With that, the 30-year bond became the latest victim of upside-down economics and the flight to safety, dipping below 2.00% in yield for the first time EVER. The entire treasury curve is now not only yielding less than two percent, it is inverted, and all of it is yielding lower returns than the effective overnight federal funds rate (2.11%).
We are witnessing the death of fiat money in real time. In the meantime, look for a short-lived relief rally which could extend through the rest of August. Real selling should commence after Labor Day.
At the Close, Wednesday, August 14, 2019:
Dow Jones Industrial Average: 25,479.42, -800.49 (-3.05%)
NASDAQ: 7,773.94, -242.42 (-3.02%)
S&P 500: 2,840.60, -85.72 (-2.93%)
NYSE Composite: 12,368.05, -356.32 (-2.80%)
Friday, November 16, 2018
Dip-Buyers Send Stocks Off Fresh Lows; Cory Booker, Poster Boy For Peak Stupidity
As stocks touched down on some key support levels, investors took the initiative to load up on what they perceived as undervalued shares, sending stocks off morning lows to afternoon highs, with NASDAQ dumb money leading the charge higher.
The major indices were under pressure early in the session, dropping to levels at which the year began, wiping out nearly all of the gains since last December. Call it coincidence or a propensity for chart-watching dip-buying, but there was no other catalyst to Thursday's mini-rally other than valuations.
On the downside, Britain seems to be completely flummoxed by ongoing Brexit negotiations, with resignations in Prime Minister Theresa May's cabinet over the compromise deal presented to the House of Commons this week. Rumors of a no confidence vote are circulating as the Brexit issue continues to derail any progress England can make in extricating itself from the European Union. The referendum, passed in early 2016, called for an exit by March of 2019, though that date now appears less certain. The issues are complex and threaten to tear the country apart.
In a completely unrelated note, America has finally achieved PEAK STUPIDITY, and its poster boy is the senator from New Jersey, Cory Booker.
Booker's proposal for "Baby Bonds" as a way to shrink the wealth gap is about as far left an approach as could be considered... without laughing.
Booker's idea is to give every newborn $1000 at birth and up to another $2000 every year thereafter - based on the parents' income, of course - until that child reaches the age of 18, or, in other words, just in time to take out a government-funded student loan, or, pay for maybe a few years of college themselves.
It's just this kind of insanity that American citizens have to endure from its government that causes angst, apathy, or confrontation between liberals and conservatives. The US has had a massive welfare program in place - that rewards having more children with higher benefits - for more than 50 years, and it's done nothing to reduce poverty or improve living conditions for chronically poor people.
With people like Booker being elected and re-elected to high government positions of power, is there any wonder why the United States are so disunited?
Despite the higher close on Thursday, investors should not be enthusiastic about an extension to the short-term rally which was likely the result more of short-covering and corporate buybacks than the actual taking of new positions in stocks. Sentiment remains murky with a bias to the downside.
Dow Jones Industrial Average November Scorecard:
At the Close, Thursday, November 15, 2018:
Dow Jones Industrial Average: 25,289.27, +208.77 (+0.83%)
NASDAQ: 7,259.03, +122.64 (+1.72%)
S&P 500: 2,730.20, +28.62 (+1.06%)
NYSE Composite: 12,361.52, +86.03 (+0.70%)
The major indices were under pressure early in the session, dropping to levels at which the year began, wiping out nearly all of the gains since last December. Call it coincidence or a propensity for chart-watching dip-buying, but there was no other catalyst to Thursday's mini-rally other than valuations.
On the downside, Britain seems to be completely flummoxed by ongoing Brexit negotiations, with resignations in Prime Minister Theresa May's cabinet over the compromise deal presented to the House of Commons this week. Rumors of a no confidence vote are circulating as the Brexit issue continues to derail any progress England can make in extricating itself from the European Union. The referendum, passed in early 2016, called for an exit by March of 2019, though that date now appears less certain. The issues are complex and threaten to tear the country apart.
In a completely unrelated note, America has finally achieved PEAK STUPIDITY, and its poster boy is the senator from New Jersey, Cory Booker.
Booker's proposal for "Baby Bonds" as a way to shrink the wealth gap is about as far left an approach as could be considered... without laughing.
Booker's idea is to give every newborn $1000 at birth and up to another $2000 every year thereafter - based on the parents' income, of course - until that child reaches the age of 18, or, in other words, just in time to take out a government-funded student loan, or, pay for maybe a few years of college themselves.
It's just this kind of insanity that American citizens have to endure from its government that causes angst, apathy, or confrontation between liberals and conservatives. The US has had a massive welfare program in place - that rewards having more children with higher benefits - for more than 50 years, and it's done nothing to reduce poverty or improve living conditions for chronically poor people.
With people like Booker being elected and re-elected to high government positions of power, is there any wonder why the United States are so disunited?
Despite the higher close on Thursday, investors should not be enthusiastic about an extension to the short-term rally which was likely the result more of short-covering and corporate buybacks than the actual taking of new positions in stocks. Sentiment remains murky with a bias to the downside.
Dow Jones Industrial Average November Scorecard:
| Date | Close | Gain/Loss | Cum. G/L |
| 11/1/18 | 25,380.74 | +264.98 | +264.98 |
| 11/2/18 | 25,270.83 | -109.91 | +155.07 |
| 11/5/18 | 25,461.70 | +190.87 | +345.94 |
| 11/6/18 | 25,635.01 | +173.31 | +519.25 |
| 11/7/18 | 26,180.30 | +545.29 | +1064.54 |
| 11/8/18 | 26,191.22 | +10.92 | +1075.46 |
| 11/9/18 | 25,989.30 | -201.92 | +873.54 |
| 11/12/18 | 25,387.18 | -602.12 | +271.42 |
| 11/13/18 | 25,286.49 | -100.69 | +170.27 |
| 11/14/18 | 25,080.50 | -205.99 | -35.72 |
| 11/15/18 | 25,289.27 | +208.77 | +173.05 |
At the Close, Thursday, November 15, 2018:
Dow Jones Industrial Average: 25,289.27, +208.77 (+0.83%)
NASDAQ: 7,259.03, +122.64 (+1.72%)
S&P 500: 2,730.20, +28.62 (+1.06%)
NYSE Composite: 12,361.52, +86.03 (+0.70%)
Thursday, October 25, 2018
Stocks Rebound, 11 Major Stock Indices In Correction, Down 10% Or More
Knee-jerk. That's all today's trading was. It evolved as an opportunity to see how many trades could be made on the assumption that stocks will continue to rise, that they are still good values, that despite the fact that major indices of at least 10 different important countries are in correction (down 10%), the US is still the best dirty shirt in the laundry, or something like that.
Just to placate the unbelievers, here is a partial list of stock indices already in correction or worse:
Ummm, that's 11, but who's counting?
Bear in mind, some of the biggest gains are made during periods of volatility and the beginnings of bear markets. For proof of that, just go back to the NASDAQ in 2000, or the Dow in October of 2008. There were plenty of big days to the upside. Unfortunately, for those taking positions in stocks during those periods, the downside prevailed, and in vey large ways.
Put in perspective, today's broad gains covered about 2/3rds of yesterday's losses. That's not enough, and there is absolutely no guarantee that tomorrow is going to be a repeat performance.
Dow Jones Industrial Average October Scorecard:
At the Close, Thursday, October 25, 2018:
Dow Jones Industrial Average: 24,984.55, +401.13 (+1.63%)
NASDAQ: 7,318.34, +209.94 (+2.95%)
S&P 500: 2,705.57, +49.47 (+1.86%)
NYSE Composite: 12,118.85, +149.11 (+1.25%)
Just to placate the unbelievers, here is a partial list of stock indices already in correction or worse:
- DAX, Germany
- FTSE, Great Britain
- CAC 40, France
- Nikkei 225, Japan
- Hang Seng, Hong Kong
- SSE Composite, China
- SENSEX, India
- KOSPI, South Korea
- Jakarta Composite, Indonesia
- MERVAL, Argentina
- IPC, Mexico
Ummm, that's 11, but who's counting?
Bear in mind, some of the biggest gains are made during periods of volatility and the beginnings of bear markets. For proof of that, just go back to the NASDAQ in 2000, or the Dow in October of 2008. There were plenty of big days to the upside. Unfortunately, for those taking positions in stocks during those periods, the downside prevailed, and in vey large ways.
Put in perspective, today's broad gains covered about 2/3rds of yesterday's losses. That's not enough, and there is absolutely no guarantee that tomorrow is going to be a repeat performance.
Dow Jones Industrial Average October Scorecard:
| Date | Close | Gain/Loss | Cum. G/L |
| 10/1/18 | 26,651.21 | +192.90 | +192.90 |
| 10/2/18 | 26,773.94 | +122.73 | +315.63 |
| 10/3/18 | 26,828.39 | +54.45 | +370.08 |
| 10/4/18 | 26,627.48 | -200.91 | +169.17 |
| 10/5/18 | 26,447.05 | -180.43 | -11.26 |
| 10/8/18 | 26,486.78 | +39.73 | +28.47 |
| 10/9/18 | 26,430.57 | -56.21 | -27.74 |
| 10/10/18 | 25,598.74 | -831.83 | -859.57 |
| 10/11/18 | 25,052.83 | -545.91 | -1,405.48 |
| 10/12/18 | 25,339.99 | +287.16 | -1,118.32 |
| 10/15/18 | 25,250.55 | -89.44 | -1,207.76 |
| 10/16/18 | 25,798.42 | +547.87 | -659.89 |
| 10/17/18 | 25,706.68 | -91.74 | -751.63 |
| 10/18/18 | 25,379.45 | -327.23 | -1,078.86 |
| 10/19/18 | 25,444.34 | +64.89 | -1,013.97 |
| 10/22/18 | 25,317.41 | -126.93 | -1,140.90 |
| 10/23/18 | 25,191.43 | -125.98 | -1,265.88 |
| 10/24/18 | 24,583.42 | -608.01 | -1,873.89 |
| 10/25/18 | 24,984.55 | +401.13 | -1,472.76 |
At the Close, Thursday, October 25, 2018:
Dow Jones Industrial Average: 24,984.55, +401.13 (+1.63%)
NASDAQ: 7,318.34, +209.94 (+2.95%)
S&P 500: 2,705.57, +49.47 (+1.86%)
NYSE Composite: 12,118.85, +149.11 (+1.25%)
Monday, April 16, 2018
Stocks Close Out Week on Sour Note, But Still Post Weekly Gains
For the superstitious, Friday the 13th was not a disaster, but it wasn't particularly pleasant either, as stocks spent the entire session underwater, unable to follow through on gains from the previous day.
The up-and-down, give-and-take between bulls and bears has been a feature of the equity markets since late January. Thus far in April, the Dow has finished with gains in six session, closing down in four. An overview of the market presents a picture of a market without direction, as geo-political events, fundamental conditions, and economic data collide.
Being the middle of earnings season, the bulls appear to have at least a short-term advantage, especially since the US - along with France and Great Britain - chose to launch targeted attacks on Syria late Friday, giving markets ample time to digest the ramifications, which, at this point, appear limited.
Heading into the third full week of the second quarter, earnings from top companies will provide the catalyst for traders. There's a widely-held assumption that companies are going to put up good - if not great - first quarter reports, aided by tax benefits from the overhaul provided by congress and the president in December.
This would be a good week to take account of positions and perhaps take some profits off the table. Markets tend to be a little less volatile and generally trade higher during earnings seasons.
There isn't a FOMC rate policy meeting during April, and the May 1-2 meeting is probably going to result in no action being taken. The next Fed-driven stock market move won't be until the June 12-13 affair, when the Fed is expected to raise the federal funds rate another 25 basis points. While it doesn't sound like much, it will be the seventh such hike since the Fed got off the zero-bound in December 2015. It will push the rate to 1.75-2.00%, a significant figure sure to have an impact not only on stocks, but on the finances of individuals, families, businesses and governments.
Presently, this is the proverbial calm before the storm.
Dow Jones Industrial Average April Scorecard:
At the Close, Friday, April 13, 2018:
Dow Jones Industrial Average: 24,360.14, -122.91 (-0.50%)
NASDAQ: 7,106.65, -33.60 (-0.47%)
S&P 500: 2,656.30, -7.69 (-0.29%)
NYSE Composite: 12,546.05, -34.17 (-0.27%)
For the Week:
Dow: +427.38 (+1.79%)
NASDAQ: +191.54 (+2.77%)
S&P 500: +51.83 (+1.99%)
NYSE Composite: +196.94 (+1.59%)
The up-and-down, give-and-take between bulls and bears has been a feature of the equity markets since late January. Thus far in April, the Dow has finished with gains in six session, closing down in four. An overview of the market presents a picture of a market without direction, as geo-political events, fundamental conditions, and economic data collide.
Being the middle of earnings season, the bulls appear to have at least a short-term advantage, especially since the US - along with France and Great Britain - chose to launch targeted attacks on Syria late Friday, giving markets ample time to digest the ramifications, which, at this point, appear limited.
Heading into the third full week of the second quarter, earnings from top companies will provide the catalyst for traders. There's a widely-held assumption that companies are going to put up good - if not great - first quarter reports, aided by tax benefits from the overhaul provided by congress and the president in December.
This would be a good week to take account of positions and perhaps take some profits off the table. Markets tend to be a little less volatile and generally trade higher during earnings seasons.
There isn't a FOMC rate policy meeting during April, and the May 1-2 meeting is probably going to result in no action being taken. The next Fed-driven stock market move won't be until the June 12-13 affair, when the Fed is expected to raise the federal funds rate another 25 basis points. While it doesn't sound like much, it will be the seventh such hike since the Fed got off the zero-bound in December 2015. It will push the rate to 1.75-2.00%, a significant figure sure to have an impact not only on stocks, but on the finances of individuals, families, businesses and governments.
Presently, this is the proverbial calm before the storm.
Dow Jones Industrial Average April Scorecard:
| Date | Close | Gain/Loss | Cum. G/L |
| 4/2/18 | 23,644.19 | -458.92 | -458.92 |
| 4/3/18 | 24,033.36 | +389.17 | -69.75 |
| 4/4/18 | 24,264.30 | +230.94 | +161.19 |
| 4/5/18 | 24,505.22 | +240.92 | +402.11 |
| 4/6/18 | 23,932.76 | -572.46 | -170.35 |
| 4/9/18 | 23,979.10 | +46.34 | -134.01 |
| 4/10/18 | 24,407.86 | +428.76 | +294.66 |
| 4/11/18 | 24,189.45 | -218.55 | +76.11 |
| 4/12/18 | 24,483.05 | +293.60 | +369.71 |
| 4/13/18 | 24,360.14 | -122.91 | +247.80 |
At the Close, Friday, April 13, 2018:
Dow Jones Industrial Average: 24,360.14, -122.91 (-0.50%)
NASDAQ: 7,106.65, -33.60 (-0.47%)
S&P 500: 2,656.30, -7.69 (-0.29%)
NYSE Composite: 12,546.05, -34.17 (-0.27%)
For the Week:
Dow: +427.38 (+1.79%)
NASDAQ: +191.54 (+2.77%)
S&P 500: +51.83 (+1.99%)
NYSE Composite: +196.94 (+1.59%)
Tuesday, July 5, 2016
Markets Becoming More Volatile By The Day; Italian Banks, British Real Estate Hit Hard
It's getting a little scary out there in finance-land.
Following the epic exercise in individual democracy in Great Britain, the world's elitist bankers and political forces have been scampering from one impaired asset class to another, the latest and most prominent being Italian banks and British Real Estate Investment Trusts (REITs).
Since Monday, three separate REITs in Britain have shut down redemptions in the wake of panicked outflows since the Brexit vote.
As for the Italian banking sector (recall that Mario Draghi, current head of the ECB, mismanaged most of Italy's financial escapades a decade ago), FUGGEDABOUTIT!
Just today, short-selling was banned in shares of Banca Monte dei Paschi di Siena, Italy's third-largest bank. Other banks in Italy are in crisis mode, with a huge amount of non-performing loans hanging over a weakening economic picture.
Here in the new world, stocks were slammed as investors suddenly noticed that the major indices were once again closing in on all-time highs. Realizing that the fundamentals didn't support such extreme valuations, it was risk off all day, with the three biggies spending the entire session in the red.
Silver continued its impressive run, closing at 19.91 in New York (where the manipulation occurs, though lately isn't working), but gunning up as trading opened in the Far East.
Here are the results, suckers:
S&P 500: 2,088.55, -14.40 (0.68%)
Dow: 17,840.62, -108.75 (0.61%)
NASDAQ: 4,822.90, -39.67 (0.82%)
Crude Oil 46.65 +0.11% Gold 1,364.10 +0.40% EUR/USD 1.1061 -0.05% 10-Yr Bond 1.37 -6.11% Corn 356.75 -0.35% Copper 2.18 -0.21% Silver 20.28 +1.87% Natural Gas 2.78 +0.43% Russell 2000 1,139.45 -1.50% VIX 15.58 +5.48% BATS 1000 20,677.17 0.00% GBP/USD 1.2961 -0.45% USD/JPY 101.1910 -0.51%
Following the epic exercise in individual democracy in Great Britain, the world's elitist bankers and political forces have been scampering from one impaired asset class to another, the latest and most prominent being Italian banks and British Real Estate Investment Trusts (REITs).
Since Monday, three separate REITs in Britain have shut down redemptions in the wake of panicked outflows since the Brexit vote.
On Tuesday, Standard Life and Aviva both halted redemptions in their U.K.-focused property funds, which are pooled investments that hold real estate, similar to a REIT. Later in the day, M&G Investments joined them.
As for the Italian banking sector (recall that Mario Draghi, current head of the ECB, mismanaged most of Italy's financial escapades a decade ago), FUGGEDABOUTIT!
Just today, short-selling was banned in shares of Banca Monte dei Paschi di Siena, Italy's third-largest bank. Other banks in Italy are in crisis mode, with a huge amount of non-performing loans hanging over a weakening economic picture.
Here in the new world, stocks were slammed as investors suddenly noticed that the major indices were once again closing in on all-time highs. Realizing that the fundamentals didn't support such extreme valuations, it was risk off all day, with the three biggies spending the entire session in the red.
Silver continued its impressive run, closing at 19.91 in New York (where the manipulation occurs, though lately isn't working), but gunning up as trading opened in the Far East.
Here are the results, suckers:
S&P 500: 2,088.55, -14.40 (0.68%)
Dow: 17,840.62, -108.75 (0.61%)
NASDAQ: 4,822.90, -39.67 (0.82%)
Crude Oil 46.65 +0.11% Gold 1,364.10 +0.40% EUR/USD 1.1061 -0.05% 10-Yr Bond 1.37 -6.11% Corn 356.75 -0.35% Copper 2.18 -0.21% Silver 20.28 +1.87% Natural Gas 2.78 +0.43% Russell 2000 1,139.45 -1.50% VIX 15.58 +5.48% BATS 1000 20,677.17 0.00% GBP/USD 1.2961 -0.45% USD/JPY 101.1910 -0.51%
Monday, June 27, 2016
Stormy Monday: Brexit Triggering Global Market Chaos
If the financial elites (we're looking at you Fed Governors, ECB ministers, central bankers worldwide) needed a rationale for triggering a cataclysmic collapse of global finance, they may have found their huckleberry in the British vote to leave the European Union, the Brexit, as it has become known.
Since Thursday's astonishing vote by the populace of Great Britain to exit what was once known as the European Common Merket and has morphed into a Hobbesian nightmare of Leviathan proportions known as the European Union, European Commission, European Central Bank and an amalgam of overlapping bureaucratic rules, regulations, guidelines, laws and edicts, a suddenly disunited Europe is making life miserable for masters of finance.
Stocks have been selling off at frantic paces since the verdict of the Brits, with uncertainty the keynote of the ongoing dialogue.
While the NIKKEI responded in heroic fashion on Monday, gaining 357 points, stock indices in Europe and the US were dragged down through the week's opening session, with more on the plate.
Whether Brexit is the absolute catalyst for systemic financial collapse is too early to tell, though it has certainly - to this point - served as an adequate warning shot.
Worth knowing is that the general financial condition of the world's developed and emerging economies has not been right since the first great financial shock of 2008, and efforts to repair what was broken then were akin to bandages applies to a severed artery, with the same result. The bleeding continued, and the patient never really recovered.
For eight years the global financial elites have tried to piece together a working economic narrative, to little avail and now they are faced with disintegration of their seminal project, the EU and the funny money known as euros.
Markets today were trembled by rabid selling, pushing the Dow well below its established range between 17,500 and 18,000, with the bottom falling out in dramatic fashion. All-time highs reached just over a year ago are now being viewed as unattainable, setting in motion the potential for first, a 10% correction, followed by the certainty of a full-blown bear market, which has been a long time coming.
Defining those two terms would be a matter of simplicity, if not for the vagaries of the financial lexicon. A correction may be said to be 10% of "recent" highs, and the same could be said of the bear market reading, but, if losses continue to mount, percentages may be the smallest of worries, since real dollars, euros, yen and yuan will be at stake.
With an already turbulent presidential election already underway, caution would be the preferred method of approaching finances over the following six to eight months. While many ordinary people will no doubt practice frugality and thrift in their affairs, there's some considerable doubt as to how governments and central bankers react to what are, no doubt, challenging times ahead.
Bad Bad Brits and Brexit:
S&P 500: 2,000.54, -36.87 (1.81%)
Dow: 17,140.24, -260.51 (1.50%)
NASDAQ: 4,594.44, -113.54 (2.41%)
Crude Oil 46.71 -1.95% Gold 1,329.90 +0.57% EUR/USD 1.1021 -0.19% 10-Yr Bond 1.46 -7.54% Corn 393.50 -0.19% Copper 2.13 +0.71% Silver 17.78 -0.02% Natural Gas 2.76 +2.41% Russell 2000 1,089.65 -3.36% VIX 23.43 -9.05% BATS 1000 20,677.17 0.00% GBP/USD 1.3218 -1.51% USD/JPY 102.0450 +0.25%
Since Thursday's astonishing vote by the populace of Great Britain to exit what was once known as the European Common Merket and has morphed into a Hobbesian nightmare of Leviathan proportions known as the European Union, European Commission, European Central Bank and an amalgam of overlapping bureaucratic rules, regulations, guidelines, laws and edicts, a suddenly disunited Europe is making life miserable for masters of finance.
Stocks have been selling off at frantic paces since the verdict of the Brits, with uncertainty the keynote of the ongoing dialogue.
While the NIKKEI responded in heroic fashion on Monday, gaining 357 points, stock indices in Europe and the US were dragged down through the week's opening session, with more on the plate.
Whether Brexit is the absolute catalyst for systemic financial collapse is too early to tell, though it has certainly - to this point - served as an adequate warning shot.
Worth knowing is that the general financial condition of the world's developed and emerging economies has not been right since the first great financial shock of 2008, and efforts to repair what was broken then were akin to bandages applies to a severed artery, with the same result. The bleeding continued, and the patient never really recovered.
For eight years the global financial elites have tried to piece together a working economic narrative, to little avail and now they are faced with disintegration of their seminal project, the EU and the funny money known as euros.
Markets today were trembled by rabid selling, pushing the Dow well below its established range between 17,500 and 18,000, with the bottom falling out in dramatic fashion. All-time highs reached just over a year ago are now being viewed as unattainable, setting in motion the potential for first, a 10% correction, followed by the certainty of a full-blown bear market, which has been a long time coming.
Defining those two terms would be a matter of simplicity, if not for the vagaries of the financial lexicon. A correction may be said to be 10% of "recent" highs, and the same could be said of the bear market reading, but, if losses continue to mount, percentages may be the smallest of worries, since real dollars, euros, yen and yuan will be at stake.
With an already turbulent presidential election already underway, caution would be the preferred method of approaching finances over the following six to eight months. While many ordinary people will no doubt practice frugality and thrift in their affairs, there's some considerable doubt as to how governments and central bankers react to what are, no doubt, challenging times ahead.
Bad Bad Brits and Brexit:
S&P 500: 2,000.54, -36.87 (1.81%)
Dow: 17,140.24, -260.51 (1.50%)
NASDAQ: 4,594.44, -113.54 (2.41%)
Crude Oil 46.71 -1.95% Gold 1,329.90 +0.57% EUR/USD 1.1021 -0.19% 10-Yr Bond 1.46 -7.54% Corn 393.50 -0.19% Copper 2.13 +0.71% Silver 17.78 -0.02% Natural Gas 2.76 +2.41% Russell 2000 1,089.65 -3.36% VIX 23.43 -9.05% BATS 1000 20,677.17 0.00% GBP/USD 1.3218 -1.51% USD/JPY 102.0450 +0.25%
Friday, June 24, 2016
As Britain Votes To Leave European Union, The Establishment Is Losing Control
Just a few days ago, our Fearless Editor, Rick Gagliano, penned a post here at Money Daily espousing the belief that the Brexit/Bremain vote and the US presidential election were sideshows and being overblown in importance by the media. Perhaps it was a faux pas or even a veiled negotiation maneuver designed to keep "remain" voters away from the polls (we doubt the latter to be true). In any case, voters in Great Britain did - in establishment terms - the unthinkable, voted to depart from the European Union, and quite possibly delivered a verdict on the perilous future of the EU.
We now present the post mortem.
All hail Nigel Farage, head of the UKIP party and leader of the "Brexit" movement in Great Britain, for he has brought the nation out from under the Orwellian totalitarianism that is essentially the bloated bureaucracy of the European Union, and unshackled the common Briton from enslavement to the status quo.
Here is what Farage said as the tally was coming in, looking favorable for Britain exit from the EU:
Having fought the good fight as an MEP and a representative to the European Parliament for nearly two decades and yesterday, Farege's unwavering rhetoric for freedom and against oppression struck the first salvo for the people against the leading technocratic superstate of the EU, headquartered in Brussels.
For Farage, the victory may have greater consequences. With PM David Cameron admitting defeat and promising to step down come October, Farage figures to be a natural candidate for the vacated post of Prime Minister. Already the mainstream press has put the face of Boris Johnson, former mayor of London, front and center, ahead of Farage, who has said openly that he doesn't want to be Britain's PM.
That battle has a long way to go, but, for now, a rundown of just what Brexit has meant to markets around the world.
The Final Tally:
Leave
Vote share 51.9%
Votes 17,410,742 Votes
Remain
Vote share 48.1%
Votes 16,141,241 Votes
Stocks indices around the world were pounded:
ASIA:
Nikkei 225: 14,952.02, -1,286.33 (-7.92%)
Hang Seng Index: 20,259.13, -609.21 (-2.92%)
SSE Composite Index: 2,854.29, -37.67 (-1.30%)
Straits Times Index: 2,735.39, -58.46 (-2.09%)
S&P/ASX 200: 5,113.20, -167.50 (-3.17%)
EUROPE:
FTSE 100: 6,138.69, -199.41 (-3.15%)
DAX: 9,557.16, -699.87 (-6.82%)
CAC 40: 4,106.73, -359.17 (-8.04%)
EURO STOXX 50 Index: 2,776.09, -261.77 (-8.62%)
EURONEXT 100: 819.99, -59.09 (-6.72%)
Some other interesting notes from early after the voting:
British pound falls as much as 11 percent to $1.3229, weakest since 1985
Yield on 10-year Treasuries drops 29 basis points to 1.46 percent, set for biggest daily decline since 2009
New York crude oil retreats 5.1 percent to $47.56 a barrel, poised for biggest loss since February
Gold rallies as much as 8.1 percent to $1,358.54 an ounce, highest since March 2014
By the end of trading in the US, the day's damage had been assessed, though it was hardly what anybody would call a bloodbath. After all, this was only the first salvo against the establishment, though it does set in motion a complete disintegration of the EU and all of its strictures, laws, rules, regulations and burdensome bureaucracy.
For Americans, it's a good day to be a supporter of Donald Trump for the presidency. Much of what Mr. Trump has been campaigned for was contained in the Brexit platform: an end to open immigration, more civil liberties for common people, smaller federal government, less regulation, lower taxes, more power to people and localities (state's rights in the US).
While the damage to stocks was minimized, the press fell all about itself in once again over-hyping the damage. Britain and her people will not vanish from the earth. New trade arrangements will be made with the countries still remaining in the EU, but it is notable that more than a few EU member states are now calling for exit votes by the people, especially in France, Spain, Italy, the Czeck Republic, Hungary, and elsewhere.
The word on the European Union: Done. It's now become not a matter of if the EU will disintegrate, but when, and how. Those will be the real fireworks. But, between then and now, expect the establishment status quo to fight like mad dogs to retain and enhance their positions of power and prestige. In the end, they too will fail.
US stocks got mangled, with a hefty drop at the open and further displeasure for bulls in the late afternoon, with the Dow - just one day after it broke through the 18,000 upper barrier - closing below 17,500, the long-standing support threshold, on heavy volume. Losses were widespread; banks and financial stocks took the worst of it.
The Dow finished the week lower for the third time in the last four; the S&P and NASDAQ each notched their third straight week of decline.
US Stocks Got Socked:
S&P 500: 2,037.41, -75.91 (3.59%)
Dow: 17,400.75, -610.32 (3.39%)
NASDAQ: 4,707.98, -202.06 (4.12%)
Crude Oil 47.57 -5.07% Gold 1,319.10 +4.43% EUR/USD 1.1118 +0.13% 10-Yr Bond 1.58 -9.20% Corn 391.50 -1.57% Copper 2.11 -2.27% Silver 17.77 +2.40% Natural Gas 2.70 -1.32% Russell 2000 1,127.54 -3.81% VIX 25.76 +49.33% BATS 1000 20,677.17 0.00% GBP/USD 1.3684 +0.06% USD/JPY 102.2550 0.00%
For the Week:
Dow: -274.41 (-1.55%)
S&P 500: -33.81 (-1.63)
NASDAQ: -92.36 (1.92)
We now present the post mortem.
All hail Nigel Farage, head of the UKIP party and leader of the "Brexit" movement in Great Britain, for he has brought the nation out from under the Orwellian totalitarianism that is essentially the bloated bureaucracy of the European Union, and unshackled the common Briton from enslavement to the status quo.
Here is what Farage said as the tally was coming in, looking favorable for Britain exit from the EU:
If the predictions now are right, this will be a victory for real people, a victory for ordinary people, a victory for decent people. We have fought against the multinationals, we have fought against the big merchant banks, we have fought against big politics, we have fought against lies, corruption and deceit. And today honesty, decency and belief in nation, I think now is going to win. And we will have done it without having to fight, without a single bullet being fired…. Win or lose this battle tonight, we will win this war, we will get our country back, we will get our independence back and we will get our borders back.
Having fought the good fight as an MEP and a representative to the European Parliament for nearly two decades and yesterday, Farege's unwavering rhetoric for freedom and against oppression struck the first salvo for the people against the leading technocratic superstate of the EU, headquartered in Brussels.
For Farage, the victory may have greater consequences. With PM David Cameron admitting defeat and promising to step down come October, Farage figures to be a natural candidate for the vacated post of Prime Minister. Already the mainstream press has put the face of Boris Johnson, former mayor of London, front and center, ahead of Farage, who has said openly that he doesn't want to be Britain's PM.
That battle has a long way to go, but, for now, a rundown of just what Brexit has meant to markets around the world.
The Final Tally:
Leave
Vote share 51.9%
Votes 17,410,742 Votes
Remain
Vote share 48.1%
Votes 16,141,241 Votes
Stocks indices around the world were pounded:
ASIA:
Nikkei 225: 14,952.02, -1,286.33 (-7.92%)
Hang Seng Index: 20,259.13, -609.21 (-2.92%)
SSE Composite Index: 2,854.29, -37.67 (-1.30%)
Straits Times Index: 2,735.39, -58.46 (-2.09%)
S&P/ASX 200: 5,113.20, -167.50 (-3.17%)
EUROPE:
FTSE 100: 6,138.69, -199.41 (-3.15%)
DAX: 9,557.16, -699.87 (-6.82%)
CAC 40: 4,106.73, -359.17 (-8.04%)
EURO STOXX 50 Index: 2,776.09, -261.77 (-8.62%)
EURONEXT 100: 819.99, -59.09 (-6.72%)
Some other interesting notes from early after the voting:
British pound falls as much as 11 percent to $1.3229, weakest since 1985
Yield on 10-year Treasuries drops 29 basis points to 1.46 percent, set for biggest daily decline since 2009
New York crude oil retreats 5.1 percent to $47.56 a barrel, poised for biggest loss since February
Gold rallies as much as 8.1 percent to $1,358.54 an ounce, highest since March 2014
By the end of trading in the US, the day's damage had been assessed, though it was hardly what anybody would call a bloodbath. After all, this was only the first salvo against the establishment, though it does set in motion a complete disintegration of the EU and all of its strictures, laws, rules, regulations and burdensome bureaucracy.
For Americans, it's a good day to be a supporter of Donald Trump for the presidency. Much of what Mr. Trump has been campaigned for was contained in the Brexit platform: an end to open immigration, more civil liberties for common people, smaller federal government, less regulation, lower taxes, more power to people and localities (state's rights in the US).
While the damage to stocks was minimized, the press fell all about itself in once again over-hyping the damage. Britain and her people will not vanish from the earth. New trade arrangements will be made with the countries still remaining in the EU, but it is notable that more than a few EU member states are now calling for exit votes by the people, especially in France, Spain, Italy, the Czeck Republic, Hungary, and elsewhere.
The word on the European Union: Done. It's now become not a matter of if the EU will disintegrate, but when, and how. Those will be the real fireworks. But, between then and now, expect the establishment status quo to fight like mad dogs to retain and enhance their positions of power and prestige. In the end, they too will fail.
US stocks got mangled, with a hefty drop at the open and further displeasure for bulls in the late afternoon, with the Dow - just one day after it broke through the 18,000 upper barrier - closing below 17,500, the long-standing support threshold, on heavy volume. Losses were widespread; banks and financial stocks took the worst of it.
The Dow finished the week lower for the third time in the last four; the S&P and NASDAQ each notched their third straight week of decline.
US Stocks Got Socked:
S&P 500: 2,037.41, -75.91 (3.59%)
Dow: 17,400.75, -610.32 (3.39%)
NASDAQ: 4,707.98, -202.06 (4.12%)
Crude Oil 47.57 -5.07% Gold 1,319.10 +4.43% EUR/USD 1.1118 +0.13% 10-Yr Bond 1.58 -9.20% Corn 391.50 -1.57% Copper 2.11 -2.27% Silver 17.77 +2.40% Natural Gas 2.70 -1.32% Russell 2000 1,127.54 -3.81% VIX 25.76 +49.33% BATS 1000 20,677.17 0.00% GBP/USD 1.3684 +0.06% USD/JPY 102.2550 0.00%
For the Week:
Dow: -274.41 (-1.55%)
S&P 500: -33.81 (-1.63)
NASDAQ: -92.36 (1.92)
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