“Tell me and I forget. Teach me and I remember. Involve me and I learn.” – Benjamin Franklin No summer doldrums as we move well through earnings. We’re seeing some super, super moves and more look to be ready to go. I do love to take more time off during summer but that is always dictated by markets and this year is quite busy. I do a lot of waiting around for trades and when they come I pounce. The trend remains up and the bull market intact. SPY is on the move again out of a small 3-day bull flag. With some major heavy hitters like AAPL, AMZN and GOOGL entering the earnings confessional next week we should see strength continue I...
The Microsoft Q4 2017 earnings were released after closing bell tonight. For its fourth fiscal quarter, the technology firm reported non-GAAP earnings of 98 cents per share on $23.3 billion in GAAP revenue or $24.7 billion in non-GAAP revenue, compared to the consensus estimates of 71 cents per share and $24.3 billion in revenue. In last year’s fourth fiscal quarter, Microsoft reported $22.6 billion in non-GAAP revenue and $20.6 billion in GAAP revenue. efes / Pixabay Microsoft Q4 2017 earnings On a GAAP basis, Microsoft Q4 2017 earnings amounted to 83 cents per share, versus the 61 cents per share that had been estimated and the 69 cent...
The S&P opened near its daily high and oscillated around a 9 point range, closing in the middle, just below yesterday’s all-time high. The index saw a fractional daily loss of 0.02% and a YTD gain of 10.48%. The U.S. Treasury puts the closing yield on the 10-year note at 2.27%. Here is a daily chart of the S&P 500. Today’s selling puts the volume 3% below its 50-day moving average. A Perspective on Drawdowns Here’s a snapshot of record highs and selloffs since the 2009 trough. Here is a more conventional log-scale chart with drawdowns highlighted. Here is a linear scale version of the same chart with the 50- and 200-...
Just last week we noted that the one entity that could ‘out-Amazon’ Amazon – the US government – was beginning to ask if Bezos’ company was too big? Tonight we got our first glimpse as the FTC sent a shot across the world’s 2nd richest man’s bow, probing allegations of illegal discounting. Reuters reports, that as part of its review of Amazon’sagreement to buy Whole Foods, the Federal Trade Commission is looking into allegations that Amazon misleads customers about its pricing discounts, according to a source close to the probe. The FTC is probing a complaint brought by the advocacy group ...
Well, that clears that up. In case you missed it, back on June 27 Mario Draghi triggered the latest declared BOND ROUT!!! with what was characterized as a very upbeat economic assessment for Europe. And if things are moving forward there, they just have to be everywhere else. It came off as “hawkish” in the sense that if real acceleration is at hand, ECB normalization of first QE then interest rates can’t be that far behind. The closer we are to the first part, closer is the second. Bonds sold off, and the collective mainstream imagination ran wild. In truth, Draghi wasn’t “hawkish” at all, nor was he all that upbeat. The media, ...
From what I’ve gathered there are 3 types of Bitcoin investors. Their strategies and mantras vary and there are two things they have in common. The first is simply being bullish on Bitcoin. Type 1 is the most common and in my opinion the most apt. This investor first heard about Bitcoin sometime in the last 5 years. As advised by most conservative analysts, or perhaps by intuition, Type 1 owns anywhere from 1-5 Bitcoins (significantly more only if net worth exceeds ~$5M) and sees the cryptocurrency as a diversification tool and/or portfolio insurance. Type 2 as a group has outperformed every hedge fund on every continent in recent year...
Spreads Tighten But Retail Is Weak Many investors are focused on the record highs in the S&P 500 and the Nasdaq and the VIX staying below 10 for another day, but I think the biggest story of Wednesday’s trading session is the tightening of bond spreads. As you can see from the chart below, the options adjusted spread for U.S. corporate BBB bonds reached a new cycle low. The spread fell to 1.41% which is below the tightest 2014 spread. This isn’t surprising because it has been flirting with this level for a few weeks. I think it’s justified based on the overall earnings situation despite the weakness in retail and energy. I have seen...
Our last Stock Exchange took a deep dive into the earnings season. If you missed it, a glance at your news will show that the key points remain relevant. This Week — Consumer Discretionary Spending Heats Up Our experts are picking up on this week’s theme in a big way. From luxurious cruises to hip new threads, our technical indicators suggest there’s something driving levels on consumer discretionary spending. Derek Benedet of seeitmarket.com had an interesting take. Let’s review some traditional causes behind increased spending: While these points are accurate, Benedet goes on to note that the patterns of spending are very differ...
Mario Draghi tried. He really did. But the market would just not buy his dovish talk. The fact of the matter is that the Eurozone recovery is in full bloom and the ECB is definitely heading for a taper as it tries to normalize monetary policy after years of extraordinary measures. Meanwhile, on this side of the Atlantic, attempts by the Fed to reassure the market that further rate hikes are coming look increasingly dubious as US data continues to disappoint. The odds of another rate hike by the end of the year have fallen below 50% and today’s weak Philly Fed numbers did not help matters. Tomorrow the econ calendar is barren, but euro bulls...
Wage and CPI inflation, even core inflation, has surprised to the downside four consecutive months. If a recession hits, and that is just a matter of time, outright price deflation is likely. Via email, Albert Edwards of Societe Generale discusses the subject in Global Strategy Weekly. US core CPI and wage inflation have surprised on the downside for four successive months. Usually only two data points are sufficient for most of us to be able to draw a trend, but four data points surely provide clear evidence of the decisive re-emergence of a deflationary trend. At the very least this recent data is grounds for a dismissal of the argument tha...