If Trump decides to stick it to Mexico in the upcoming NAFTA talks, US farming industry will take a hit. In advance of the talks, the Farm Lobby is Pressuring Trump. Trump blames the North American Free Trade Agreement – the “worst trade deal ever” in his words – for millions of lost manufacturing jobs and promises to tilt it in America’s favor. But for U.S. farmers the 23-year old pact secures access to stable, lucrative markets in Mexico and Canada that now account for over a quarter of U.S. farm exports. Another concern is that the mere uncertainty of open-ended trade talks could drive Mexico to alternative suppliers of grains,...
Share markets in India are presently trading marginally lower. Sectoral indices are trading on a mixed note with stocks in the capital goods sector and realty sector witnessing maximum selling pressure. Healthcare stocks are trading in the green. The BSE Sensex is trading down 93 points (down 0.3%) and the NSE Nifty is trading down by 29 points (down 0.3%). The BSE Mid Cap index is trading down by 0.2%, while the BSE Small Cap index is trading down by 0.7%. The rupee is trading at 64.46 to the US$. As per a leading financial daily, Prime Minister Narendra Modi is going to hold a high-profile meeting to review India’s fore...
USD/JPY 4 hour The USD/JPY broke back above the resistance trend line (dotted red) and could be retracing within a wave 2 (orange). The structure is valid unless price manages to break above the 100% level, which would invalidate the wave 2 and potential reversal for a new downtrend. There is also a potential for a head and shoulders reversal chart pattern (purple boxes) if price were to reverse around the 50-61.8% Fibonacci resistance level. A break below the neck support line (green) would then confirm the development of the chart pattern. 1 hour The USD/JPY indeed bounced at the previous bottom to complete a wave b (purple) correction as m...
The pound is a bit confused with the talk coming out from the Bank of England. What’s next? Here is their view, courtesy of eFXnews: BTMU FX Strategy Research notes that the BoE appears likely to be the next G10 central bank to begin raising interest rates which should offer more support for GBP heading into year end. “We continue to believe that maintaining emergency policy settings is no longer required. The UK economy is still holding up better than feared following the Brexit vote as evident by the release yesterday of the latest UK labour market report. Employment growth expanded robustly by 175k in the three months to the end of M...
Can You Profit from Trading the Earnings Season? Four times a year there is a confluence of corporate earnings reports. It can create turbulence for the overall market as well as the individual stocks. Is there anything we can do to take advantage of this avalanche of breaking news? We have advice from several experts, and some special resources. Trading Tips for Earnings Season Fidelity Investments offers a comprehensive guide, beginning with your own earnings forecast. Investopedia also has an overview of strategies. Goldman Sachs shares ideas for playing the current low volatility. While the examples are from last quarter, the concept...
WTI Crude Oil The WTI Crude Oil market rallied on Thursday, after initially dipping down towards the $45 level. We bounced enough to reach above the $46 level, and I think that any rally at this point is going to start running into a significant resistance. The $47 level above should be a bit of a ceiling, so I’m looking for and exhaustive candle to start selling. If we break down below the $45 level, I think the market will drop to the $43.50 level then. I believe that there is still a significant amount of bearish pressure longer-term on this market, but we are starting to see a bit short covering so we could continue to be very volatile....
Normally the worst season for the stock market is between July and November, especially August through mid-October, with September the worst month for losses (on average, of course). The first wave of the 1929 to 1932 crash ran from early September into mid-November, claiming a loss of 47% in just two and a half months. This year, this time frame could be equally dangerous… I’m a long-term forecaster, so I look to Andrew Pancholi at markettimingreport.com to fine tune the shorter-term situation. That’s not an easy task. And it’s impossible to be right all of the time. If you can nail short-term forecasts about 60% or 70% of the time...
Crude oil prices turned higher even as the IEA warned that global market rebalancing has become less certain. The agency cited increasing OPEC output despite a cartel-led production cut effort even as more swing supply – particularly from the US – comes online. This has derailed efforts to drain bloated stockpiles. Seemingly counter-intuitive price action may reflect corrective flows triggered by the passage of the last bit of major event risk for the week. The Baker Hughes rig count report is on tap but this rarely generates a significant response. Indeed, the WTI benchmark’s average move in the 30 minutes after the weekly relea...
The chart below shows a new tailwind the stock market has going for it now that the earnings recession is over. As you can see from the chart on the top, the green line showing operating earnings has surpassed the combination of dividends and buybacks. This decline in capital returned to shareholders is only because of the decline in buybacks as dividends can’t be cut that easily. Many income investors rely on dividends which is why they are sacrosanct. Often firms highlight their consistency with paying dividends as reason to buy their stock. As you can see from the chart below, buybacks are almost always larger than dividends which means ...
Asian equity markets are mixed today. The Nikkei 225 is up 0.22%, while the Hang Seng is up 0.01%. The Shanghai Composite is trading down by 0.20%. US markets ended higher and the Dow another record high close, with financials rising ahead of profit reports due Friday from several big US banks. Back home, share markets in India have opened the day on a flat note with a negative bias. The BSE Sensex is trading lower by 31 points while the NSE Nifty is trading lower by 8 points. The BSE Mid Cap Index and BSE Small Cap index opened the day up by 0.2% & 0.3% respectively. Sectoral indices have opened the day on a mixed note w...