Shares of Bank of New York Mellon (BK) were higher in late morning trading after slipping approximately 5% Thursday following the bank saying on its quarterly conference call that it plans to spend the lion’s share of tax reform gains on increasing the minimum wage of its U.S. employees and technology upgrades. In response, JPMorgan downgraded the stock, saying such moves will result in “sizable” restructuring charges, while Morgan Stanley upgraded BNY Mellon, saying the reaction to such investments is overblown. WHAT’S NEW: Following BNY Mellon’s fourth quarter earnings report yesterday, the bank’s executi...
The risk of a correction in the equity bull market Rising commodity prices, including oil, are feeding through to PPI Unemployment data suggests wages may begin to rise faster Federal Reserve tightening will continue, other Central Banks may follow The bull market will be nine years old in March, the second longest in history Since March 2009, the US stock market has been trending broadly higher. If we can continue to make new highs, or at least, not correct to the downside by more than 20%, until August of this year it will be the longest equity bull-market in US history. The optimists continue to extrapolate from the unexpected strength of ...
Trading is a very tough challenge because the relationship between effort and success is almost non-existent. You can do almost everything right and lose or you can do everything wrong and win. While luck plays a role in almost all human endeavors ( you just need to see last week’s American football matches to see how a random bounce made all the difference) in trading the variance is far greater than in any other field. There is absolutely no way, for example, that a pudgy 5 foot 6 teenager with coke bottle glasses could walk on a professional football field (be it American football or soccer ) and score. Yet in trading, that very same nov...
Two days ago we reported that stock market optimism among both professional and retail investors had hit the highest level since the crash of 1987… … with a recent E-Trade survey disclosing the 8 out of 10 retail investors were certain that stocks would rise in Q1. And, according to the latest EPFR fund flow data as compiled by Bank of America, they have been putting their money where their euphoria is. According to BofA CIO Michael Hartnett, the 4-week inflows into equities was not only “thundering”, it was the largest ever. This is the result of a massive $23.9bn weekly inflow into equities which brings the 4-week in...
FX Talking Points: USD/JPY Rebound Unravels Ahead of BoJ; U.S. GDP Report on Tap. Crude Oil Prices to Face Larger Pullback as RSI Falls Back From Overbought Territory. USD/JPY remains under pressure as the U. of Michigan Confidence survey unexpectedly narrows to 94.4 from 95.9 in December, with the pair at risk for further losses as it imitates a fresh series of lower highs and lows ahead of the Bank of Japan’s (BoJ) first interest rate decision for 2018. The BoJ meeting may do little to alter the near-term outlook for the dollar-yen exchange rate as the central bank continues to embark on its Quantitative/Qualitative Easing (QQE) Progr...
SunTrust Banks‘ (STI – Free Report) fourth-quarter 2017 adjusted earnings of $1.09 per share outpaced the Zacks Consensus Estimate of $1.05. Also, the figure was up 21% year over year. Results were primarily driven by a rise in revenues (supported by higher interest rates), stable adjusted expenses and lower provision for credit losses. Also, improving asset quality was a tailwind. However, a decline in loan and deposit balances was the undermining factor. After considering one-time discrete gains including tax reform related benefit, net income available to common shareholders was $710 million, up 58% from the prior-year quarte...
This week’s slot in the Safari portfolio is reserved for the Industrials sector. That sector includes twenty-three industries all related to designing, fabricating and servicing stuff we want and use. The industrials industries range from aerospace and defense to waste management with all the transportation, business services, and equipment required to do that in between. Today I’m reviewing a business services firm named De La Rue plc Its trading ticker symbol is DELRF. De La Rue plc is a commercial producer of currency worldwide. The company operates through three segments: Currency, Identity Solutions, and Product Authenticati...
The markets have kicked off 2018 with a bang. Most major indexes are climbing at the fastest pace since 2003. The Dow Jones Industrial Average jumped 1,000 points in its fastest time ever, from 25,000 to 26,000. And investor optimism is at all-time highs as well. The surge to start the year sent a popular ratio, the put/call ratio, to its lowest level in almost four years. The ratio measures the amount of put options and call options investors hold. When there are more call options, or bullish bets, than put options, or bearish bets, the ratio is below 1. As the ratio gets farther away from 1, it starts to tell us what we can expect from the ...
The University of Michigan Preliminary Consumer Sentiment for January came in at 94.4, down 1.5 from the December Final reading of 95.9. Investing.com had forecast 97.0. Surveys of Consumers chief economist, Richard Curtin, makes the following comments: While the preliminary January reading for the Sentiment Index was largely unchanged from last month (-1.5%), consumers evaluated current economic conditions less favorably (-4.6%). This small decrease in current conditions produced a small overall decline. Importantly, the survey recorded persistent strength in personal finances and buying plans, while favorable levels of buying conditions f...
The dollar remained on the defensive but it wasn’t one-sided anymore. The greenback fought back. GDP from the US and the UK, rate decisions in Japan and the euro, and many other events await us in a busy week. Here are the highlights for the upcoming week. The greenback suffered from the potential threat of a government shutdown and mixed housing figures. However, comments from various Fed officials remained generally bullish on the economy. The big news from last week remained in play: China may diversify away from US Treasuries. but we have also seen a correction, most notably in USD/JPY. In the euro-zone, ECB officials tried to talk do...