Dow Turns Positive With Just 10 Minutes Left In Session; Thanks to Fed Minutes?

OK, lemmings, your nightly stock market news byte tells you that the Dow was up a whopping 52 points.

That's all you need to know, unless you want to know that the Dow and the other indices were down most of the day, with the industrials turning positive with just 10 minutes left in the trading day.

No need to worry about that 167-point drop by midday. By 4:00 pm EDT, that was ancient history because - according to the official narrative - the stock gurus were thrilled by the Fed Minutes from the May 2nd FOMC meeting.

Somehow, broad approval of two percent inflation and continued hiking of the federal funds rate (the betting is for four rate increases this year; one already in January) is good for the economy.

Just for fun, try out this nifty inflation calculator. You might be surprised to find that the cumulative rate of inflation since 1990 (28 years ago) is 91.7%, meaning the value of your dollars have decreased by nearly half. A $20 item in 1990 would cost $38.34 today.

Convinced that 2% inflation (about what it's been for the last 30 years) is a good thing? Think again. The Fed's mandate was to maintain stable prices, not constantly increasing prices. They've failed.

Dow Jones Industrial Average May Scorecard:

Date	Close	Gain/Loss	Cum. G/L
5/1/18	24,099.05	-64.10	-64.10
5/2/18	23,924.98	-174.07	-238.17
5/3/18	23,930.15	+5.17	-233.00
5/4/18	24,262.51	+332.36	+99.36
5/7/18	24,357.32	+94.81	+194.17
5/8/18	24,360.21	+2.89	+197.06
5/9/18	24,542.54	+182.33	+379.39
5/10/18	24,739.53	+196.99	+576.38
5/11/18	24,831.17	+91.64	+668.02
5/14/18	24,899.41	+68.24	+736.26
5/15/18	24,706.41	-193.00	+543.26
5/16/18	24,768.93	+62.52	+605.78
5/17/18	24,713.98	-54.95	+550.73
5/18/18	24,715.09	+1.11	+551.84
5/21/18	25,013.29	+298.20	+850.04
5/22/18	24,834.41	-178.88	+671.16
5/23/18	24,886.81	+52.40	+723.56

At the Close, Wednesday, May 23, 2018:
Dow Jones Industrial Average: 24,886.81, +52.40 (+0.21%)
NASDAQ: 7,425.96, +47.50 (+0.64%)
S&P 500: 2,733.29, +8.85 (+0.32%)
NYSE Composite: 12,743.40, -23.25 (-0.18%)

No Follow-Through for Stocks After Monday's Fake Ramp-Fest

Stocks opened higher but quickly reversed direction, resulting in the second-largest one-day point drop on the Dow Industrials in May.

Coincidentally, the lower close occurred on a Tuesday, similar to last week's Tuesday trashing of 193 points.

The financial media attributed the quick turnaround to President Trump's wavering on China trade negotiations, just as Monday's advance was credited to Treasury Secretary Steven Mnuchin's announcement that the proposed tariffs on imports from China were "on hold."

For weeks, the public has been fed nauseating nonsense about stocks reacting to trade and tariff proposals from President Trump and his administration, particularly relating to China. The idea that a single event or series of events, which, in fact, should be positive for American businesses, affecting the entire stock market is ludicrous on the surface and either disingenuous or naive reportage by the financial press.

Stocks have been trading in fits and starts since early February due, not to tariffs or day-to-day events, but, to larger economic issues and obvious overvaluation foisted upon the investing public by Wall Street hucksters and the phony incentives and spurious mutterings from Federal Reserve officials.

There is nothing even remotely connected to tariffs and trade affecting the price levels of stocks, especially since the president's tariffs are only proposals and not in force. Besides the obvious benefit the United States would obtain from lowering its trade deficit with the Chinese, just what is it that is so ominous and wrong about the imposition of tariffs that would level the trade playing field?

The rhetoric surrounding the proposed tariffs reeks of the same kind of anti-Trump noise heard from the mainstream media for the past eighteen months.

Normally, in a free market, stocks rise and fall based upon fundamental valuation metrics and some degree of emotion-based trading from the Wall Street herd. The current environment, driven by computer algorithms which respond to news headlines in knee-jerk fashion, is neither normal nor free.

It's time for a reversion to the mean and a restoration of of sanity in markets and the larger economy. This implies a devaluation of stocks across the board, a quieting of the voices which drive speculation, and regulations designed to minimize the effect of computer-driven excesses.

At the Close, Tuesday, May 22, 2018:
Dow Jones Industrial Average: 24,834.41, -178.88 (-0.72%)
NASDAQ: 7,378.4551, -15.5811 (-0.21%)
S&P 500: 2,724.44, -8.57 (-0.31%)
NYSE Composite: 12,766.65, -37.36 (-0.29%)

Dow's Big Bear Market Rally Led Higher By Overvalued Boeing Shares

Monday's rally had everybody singing the praises of Treasury Secretary Mnuchin and the "on hold" status of trade negotiations with China. Supposedly, this gave the markets an "all clear" signal to buy more risk assets at elevated price levels (remember, the Dow is only off 6-7% from the all-time high of 26,616.71, January 26).

On the surface, a 300-point gain on the Dow provides a reason to cheer the market and the economy. Underneath the hood, however, the gears are grinding, sparks are coming from various frayed electrical components and the engine is sputtering and coughing. Any description of the US economy as anything better than sputtering should be viewed with resolute skepticism.

The big move on the Dow was fueled mostly by a rise in Boeing (BA), which was up 3.61% and is trading at the nosebleed level of 363 per share. For perspective, two years ago Boeing was trading at 127 per share. So, that's a triple for a company that is one of the more mature companies in America. Absurdly, Boeing is carrying a simple PE ratio of 27, a number normally reserved for high-growth companies.

Meanwhile, the seeming were out in force, disregarding the reality of a slowing, or, at best, sputtering economy (despite what you're reading or hearing) and stocks still well below the previous highs earlier in the year.

Monday's rally was nothing more than a media-inspired bear market rally. It had all the elements: only a few stocks led the way, the media was cheerleading all along, it was on a Monday.

Whatever your perspective of the market, there is little evidence that it is not massively overbought at any level above Dow 20,000. Trade wisely.

Dow Jones Industrial Average May Scorecard:

Date	Close	Gain/Loss	Cum. G/L
5/1/18	24,099.05	-64.10	-64.10
5/2/18	23,924.98	-174.07	-238.17
5/3/18	23,930.15	+5.17	-233.00
5/4/18	24,262.51	+332.36	+99.36
5/7/18	24,357.32	+94.81	+194.17
5/8/18	24,360.21	+2.89	+197.06
5/9/18	24,542.54	+182.33	+379.39
5/10/18	24,739.53	+196.99	+576.38
5/11/18	24,831.17	+91.64	+668.02
5/14/18	24,899.41	+68.24	+736.26
5/15/18	24,706.41	-193.00	+543.26
5/16/18	24,768.93	+62.52	+605.78
5/17/18	24,713.98	-54.95	+550.73
5/18/18	24,715.09	+1.11	+551.84
5/21/18	25,013.29	+298.20	+850.04

At the Close, Monday, May 21, 2018:
Dow Jones Industrial Average: 25,013.29, +298.20 (+1.21%)
NASDAQ: 7,394.04, +39.70 (+0.54%)
S&P 500: 2,733.01, +20.04 (+0.74%)
NYSE Composite: 12,804.01, +86.59 (+0.68%)

Weekend Wrap: Stocks Stuck In Limbo As Rise In Yields and Oil is Relentless

Anybody looking for volatility on Friday's options expiry was sorely disappointed with the rangebound markets and little change as a dull week came to an even duller finish.

What did move dramatically for the week was bond yields and oil, both of which spiked at the expense of the equity markets, all quite predictable.

As the case for a bear market in stocks continues to grow every day the January 26 high on the Dow of 26,616.71 gets further and further away, so the denial of the Wall Street crowd and pension fund maniacs which know nothing other than stocks, stocks, and more stocks, all the time, everywhere.

As the Money Daily Dow Scorecard below clearly shows, the 30 blue chip stocks were down for the week, though the losses were contained. None of the indices fell by more than one percent, the nearest to that the NASDAQ, with a loss of 0.66%.

Since the early February selloff, stocks have gone exactly nowhere, a point of emphasis for the bears who contend that despite the narrative of "full employment," a growing economy (2-3% is barely keeping pace with inflation; real growth is somewhere in the range of -3 to -5 percent), tax breaks and a strong dollar, undermining the false bravado of the bulls is oil soaring over $71/barrel for WTI crude and notching above $89/barrel this week for Brent crude, plus the 10-year note spiking to 3.11%.

Rising bond yields - which compete with stocks in the relative risk paradigm - and rising fuel prices make a very challenging environment for stock holders, especially those trying to beat the indices, which shouldn't be a tough job, though it has become so as everything is falling and the component parts are falling faster.

Stock pickers may find their task all the more challenging by crowded trades in favored sectors. Tech and consumer non-durables have been hammered recently, but the energy sector has fared much better, up something on the order of 8% on the year. Basic materials have been a disappointment for the most part, and dividend-carrying stocks are, again, barely keeping up with inflation.

It's a no-win market just about everywhere for those who only can go long, so the bears once again have the upper hand.

Dow Jones Industrial Average May Scorecard:

Date	Close	Gain/Loss	Cum. G/L
5/1/18	24,099.05	-64.10	-64.10
5/2/18	23,924.98	-174.07	-238.17
5/3/18	23,930.15	+5.17	-233.00
5/4/18	24,262.51	+332.36	+99.36
5/7/18	24,357.32	+94.81	+194.17
5/8/18	24,360.21	+2.89	+197.06
5/9/18	24,542.54	+182.33	+379.39
5/10/18	24,739.53	+196.99	+576.38
5/11/18	24,831.17	+91.64	+668.02
5/14/18	24,899.41	+68.24	+736.26
5/15/18	24,706.41	-193.00	+543.26
5/16/18	24,768.93	+62.52	+605.78
5/17/18	24,713.98	-54.95	+550.73
5/18/18	24,715.09	+1.11	+551.84

At the Close, Friday, May 18, 2018:
Dow Jones Industrial Average: 24,715.09, +1.11 (0.00%)
NASDAQ: 7,354.34, -28.13 (-0.38%)
S&P 500: 2,712.97, -7.16 (-0.26%)
NYSE Composite: 12,717.42, -30.41 (-0.24%)

For the Week:
Dow: -116.08 (-0.47%)
NASDAQ: -48.54 (-0.66%)
S&P 500: -14.75 (-0.54%)
NYSE Composite: -44.40 (-0.35%)

Stocks Stalled As Bull-Bear Debate Intensifies

Equities traded in tight ranges on the main exchanges Thursday, with the bears winning the day, albeit marginally.

The small boost from retail stocks earlier in the week failed to extend to the general market. Cisco Sytems (CSCO) and Wal-Mart (WMT) each weighed heavily on the market despite both companies meeting analyst exceptions for first quarter earnings.

Current market mood is jaded, as companies that have reported acceptable earnings for the first quarter have been routinely punished by the market, with immediate selloffs the norm on receipt of news, whether good or bad. That kind of action is a pretty good indicator of distribution, an otherwise gentler term for profit-taking.

Heading into the tail end of the week, the Dow is looking considerably weaker than at the start, with Monday, May 14, the culmination of an eight-day winning streak, possibly marking the high-point of the month.

Friday is an options expiration day, so, some volatility is to be expected, though it's equally likely that many punters have already closed out their positions, which could leave the market with little upside. As odds go, the day looks very much like a toss-up, though a move of more than 150 points either way on the Dow is unlikely unless the herd gets a signal to scramble.

Dow Jones Industrial Average May Scorecard:

Date	Close	Gain/Loss	Cum. G/L
5/1/18	24,099.05	-64.10	-64.10
5/2/18	23,924.98	-174.07	-238.17
5/3/18	23,930.15	+5.17	-233.00
5/4/18	24,262.51	+332.36	+99.36
5/7/18	24,357.32	+94.81	+194.17
5/8/18	24,360.21	+2.89	+197.06
5/9/18	24,542.54	+182.33	+379.39
5/10/18	24,739.53	+196.99	+576.38
5/11/18	24,831.17	+91.64	+668.02
5/14/18	24,899.41	+68.24	+736.26
5/15/18	24,706.41	-193.00	+543.26
5/16/18	24,768.93	+62.52	+605.78
5/17/18	24,713.98	-54.95	+550.73

At the Close, Thursday, May 17, 2018:
Dow Jones Industrial Average: 24,713.98, -54.95 (-0.22%)
NASDAQ: 7,382.47, -15.82 (-0.21%)
S&P 500: 2,720.13, -2.33 (-0.09%)
NYSE Composite: 12,747.83, +4.03 (+0.03%)