Citigroup Economic Surprise Index

June 27, 2018

Stocks opened higher (Dow +130 pts; SPX +.35%) following this week’s overreaction to trade rhetoric from the Trump Administration. Ten of eleven market sectors are in the green, led by energy, industrials and materials. Only healthcare is in the red. The VIX Index is back down to 15.5. European markets are poised to close up about 1% despite continued weakness in Asia overnight. Oil shot back up to $72.60/barrel. Bonds are rising in price as well. The 5-year Treasury yield has fallen back to 2.72% from its May high of 2.94%. The 10-year yield is back down to 2.85%. Go figure.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 1, 2018

Stocks are mixed this morning (Dow +31 pts; SPX -.17%). It seems traders like Fed Chair Powell’s tone as he reports to a US Senate committee. Utilities (+.6%), transports (+.8%) and energy (+.6%) are leading way. On the other hand, technology, gold miners, pharmaceuticals and retailers are in the red. The VIX Index is up around 20 again following yesterday’s rout. The dollar is a bit stronger and commodities are mostly weaker. WTI crude oil is trading below $61/barrel. That’s a 1-month low for oil, and yet most energy stocks are in the green today. Bonds are slightly higher in price, lower in yield. The 5-year Treasury yield is trading at 2.63% and the 10-year is back down to 2.85%. Remember, equities are taking their cue from the 10-year.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 28, 2017

The major stock market averages opened higher this morning (Dow +126 pts; SPX .5%), hitting new all-time highs. Ten of eleven sectors are in the green led by financials, industrials and materials. Only real estate is down in early trading. The VIX Index is still hovering around 10. European markets are poised to close up about .6%. The dollar is stronger on better economic data and so most commodities are trading lower. WTI crude oil is down .5% to trade around $57.80/barrel. OPEC is scheduled to meet this week. Bonds are up modestly as yield tick lower. The 5-year Treasury yield is back down to 2.04% and the 10-year is trading at 2.32%. By the way, in a congressional confirmation meeting today, Fed Chair candidate Jerome Powell implied the Fed will likely raise interest rates next month. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 3, 2017

Stocks opened mixed this morning (Dow & SPX flat; Nasdaq +.3%). Biotechs, utilities, retailers and consumer staples stocks are faring well in early trading. And select names like Apple (AAPL) are up after reporting earnings. But gold miners, banks, REITs, and materials stocks are in the red. We got a raft of economic data, much of which was positive. The VIX Index backed down to 9.7, which suggests a continued low volatility environment for equities. Commodities are mostly lower but WTI crude oil is hanging in there at $54.50/barrel. Bonds are trading modestly lower. The 5-year and 10-year Treasury yields edged up to 2.02% and 2.36%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

October 3, 2017

The major stock market averages opened higher again today. The Dow—currently up 65 pts—briefly touched a new all-time high. The SPX is up very slightly. Believe it or not, the telecom is leading the way, up .8%. A host of other sectors and industries are higher on the day as well (i.e. semiconductors, transports, consumer goods). Utilities & healthcare are in the red. European stock markets are poised to close up about .3% and most of Asia was higher overnight. The dollar is slightly lower against a basket of foreign currencies today, but has been strengthening over the last month. And if US economic growth accelerates & the Fed hikes interest rates again late this year, you can expect that the dollar will rise. Commodities are mixed today. Copper and gold are higher on the day but WTI crude oil backed down to around $50.30/barrel. Bonds are trading mostly higher as yields edge lower. The 5-year and 10-year Treasury yields are currently at 1.92% and 2.33%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

August 15, 2017

The major stock market averages opened higher but quickly gave way. The Dow is currently up 9 pts and the SPX is flat. Banks, healthcare, consumer staples and utilities are in the green. But energy, real estate, telecom and consumer discretionary sectors are lower. Traders are wondering whether last week’s mini-pullback is really over yet. The VIX Index is back down under 12. European stock markets are poised to close up about .3%. The dollar is stronger today as a result of better than expected economic data (see below), and commodities are therefore a bit lower. WTI crude oil is trading lower to $47.30/barrel. Bonds are also trading lower. The 5- and 10-year Treasury yields are back up to 1.81% and 2.26%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

July 5, 2017

Stocks opened lower this morning but quickly recovered (Dow -15 pts; SPX flat). The energy sector is down 1.5% as oil prices pull back for the first time in eight trading sessions. Tech, on the other hand, is the best-performing sector with semiconductors (+1.3%) leading the way. That said, over the last week or so “value” sectors like energy and financials have begun to outpace tech. So we’re seeing a bit of a sector rotation. The dollar is slightly higher on the day as commodities fall. WTI crude oil is down over 3% to trade around $45.40/barrel. Iron ore and copper are also down at least 1% today. Bonds are mostly unchanged after selling off over the past week. The 5-year Treasury yield has backed up to 1.92% and the 10-year yield is hovering around 2.34%. This is a big deal since all investors are watching the bond market like a hawk for any signs of accelerating inflation expectations. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

June 26, 2017

The major stock market averages climbed briefly at the open, but quickly turned around. The Dow is up 40 pts, the SPX is up .2% and the Nasdaq is flat. “Waffling” has become a consistent pattern throughout June, according to CNBC’s Jim Cramer. “The market can’t make up its mind.” In addition, we’re seeing huge dispersion of returns from sector to sector, and from stock to stock.  For example, healthcare is screaming higher (+6%) this month, while energy has sagged .5%. And even within the energy sector, Chevron (CVX) is up 1.3% this month but Schlumberger (SLB) is down 5%. Mr. Cramer rightly points out that “nothing is trading in unison.” The VIX Index continues to trade near record lows (below 10 today), but while the SPX looks like it is simply treading water, there is a lot going on under the hood. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

June 5, 2017

Stocks opened a bit lower this morning. At the moment, the Dow is down 8 pts and the SPX is down .12%. Oil producers and semiconductors are higher in early trading. Most other groups, however, are modestly lower. The VIX Index is hovering around 10, considered very low, and the VXTLT (long-term Treasury bond volatility) is trading at 10.8. So expected volatility on both stocks and bonds is down quite a bit this year. European markets are down about .3% after last weekend’s terror attack in the UK. Most of Asia was down about the same percentage overnight. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

May 2, 2017

Stocks opened mixed this morning, without direction. The Dow and S&P 500 are currently flat. Gold miners are up over 1% in early trading, whereas banks, semiconductors and biotechs are struggling. The Financials sector has now given up nearly all its year-to-date gains. Both emerging markets and developed foreign stocks are up on the day. The VIX Index is up a bit to trade around 10.2, which is still extremely low. Commodities are mostly lower. Oil is down again to trade around $48.60/barrel. Bonds are slightly higher in price, lower in yield. The 5- and 10-year Treasury yields are trading at 1.83% and 2.31%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 29, 2017

Stocks opened mixed today (Dow -48 pts; SPX flat; Nasdaq +.2%). We’re in no-man’s-land until earnings season starts in a couple of weeks. Energy stocks are bouncing back (+1%) after taking a beating so far this year. Retailers, gold miners and biotechs are up nicely, but most everything else is lower in early trading. The VIX Index is back down under 12 and VIX April futures are down to 12.8. The dollar is up a bit and yet most commodities are higher. WTI crude oil is up over $49/barrel. Remember, early this year oil prices corrected 12% and are just now beginning to move back up toward $50. Bonds are mostly higher in price, lower in yield. The 5- and 10-year Treasury yields are down to 1.94% and 2.39%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 21, 2017

Stocks are lower in early trading this morning (Dow -168 pts; SPX -.9%). This is the worst trading day for the Dow since October 2016. Financials (-2%) and industrials (-1.2%) are taking the brunt of the punishment. Biotechs, semiconductors and regional banks are down 2% or more in early trading. Utilities and real estate are the only sectors in the green. The VIX Index is trading up to 12. VIX April futures are up around 13. The dollar and commodities are both trading lower. WTI crude oil is down 1% to $47.60/barrel. The dollar, by the way, is at its lowest point so far this year. Not surprisingly, gold is up a bit today. Bonds are trading higher in price, lower in yield. The 5-year Treasury yield, after breaking out to new multi-year highs a week ago, is back down around 1.97%. The 10-year yield is trading down to 2.44%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

February 17, 2017

Stocks gapped down at the open, giving back a little of this week’s rally. The Dow and SPX are currently down 70 pts & .29%, respectively. Consumer staples is the only major market sector in the green at the moment. Gold miners, banks, oil companies and telecom carriers are down the most. Most of the rest of the world is in sync: Europe is poised to close down .5% to .8% and Asia was down roughly .5% overnight. The VIX Index is up, trading near 12—nothing to worry about yet. Volatility has been very low and that is making short -term traders nervous. Bonds are trading higher in price, down in yield. That’s to be expected when stocks are lower. The 5-year and 10-year Treasury yields are down to 1.91% and 2.42%, respectively. In addition, the 2-year Treasury yield doesn’t appear to be building in a March rate hike from the Federal Reserve. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

February 6, 2017

The major market averages opened mixed this morning (Dow +13 pts; SPX -.1%). Most sectors are seeing modest declines led by energy (-.5%) and real estate (-.5%). Industrials and Tech are slightly higher. The VIX Index is up about 3% to trade around 11.3, which is still considered very low. In fact, the VIX sank to a 2 ½ year low last week. And again, traders are watching the fear gauge closely for signs that the Trump Rally is fading. The dollar is stronger on the day but commodities are mixed (gold, copper higher; oil lower). WTI crude oil surged to nearly $54/barrel last week but is trading back down to $53.30 today. We understand OPEC states seem to be abiding by the cartel’s stated production limits. Bonds are rising in price (down in yield) this morning. The 5- and 10-year Treasury yields are now at 1.87% and 2.45%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

December 15, 2016

Stocks Climbed yet again in today's session (Dow +60 pts; SPX +.39%). Financials led the way, up 1% after yesterday’s Fed announcement (see below). WTI crude oil opened lower but reversed course to trade up over $51/barrel. Bonds are selling off again. The 5-year Treasury yield is trading up to 2.09% and the 10-year is up to 2.60% (2+ year high).

The SPX and Dow are now up 6% and 8.7%, respectively since the election. The Nasdaq is up 5.2%. In the same period, the financial sector is up over 18% while the utilities sector is down 1.8%. So lots of dispersion. 

Wells Fargo (WFC) has been found in violation of the Dodd-Frank Act’s “living will” regulation. Last April, the Federal Reserve rejected the bank’s living will plan, along with Bank of America’s, Bank of New York Mellon’s, State Street’s and JP Morgan Chase’s plans. Since then, all but Wells Fargo have corrected deficiencies. The living will is essentially a plan to break up or dissolve large financial institutions in the case of another dire financial crisis. As a consequence, Wells Fargo is now temporarily banned from setting up international business units or acquiring non-bank financial services companies. The bank is scheduled to re-submit a revised living will plan by the end of March. What exactly is deficient about the current plan is hard to understand. Regulators said Wells has problems with the way it organized various “legal entities” and also with its method of sharing services between business units. The stock was down yesterday, but closed up 1% today. 

Yesterday, the Federal Reserve’s Open Market Committee (FOMC) decided to raise its short-term policy interest rate by .25% to .50%. Here are the main takeaways from Fed Chair Janet Yellen’s subsequent press conference: 
The GDP outlook is improved very slightly but she says we're still in for another two years of ~2% economic growth. She expects the unemployment rate to fall further to 4.5% by the end of 2017. And inflation will begin to accelerate from 1.5% today to 1.9% at the end of 2017 to 2.0% at the end of 2018. She now expects the Fed to raise short-term interest rates to about 1.4% by the end of 2017 and to 2.1% at the end of 2018. So putting it all together, the Fed expects a really tight job market, rising inflation, rising interest rates, and sort of disappointing economic growth. If you believe Mrs. Yellen, the outlook is not terribly encouraging; she characterizes it as “highly uncertain." In the aftermath of the announcement, the 10-year Treasury yield spiked to 2.56%, the highest since September 2014.

Retail sales disappointed in November, decelerating a bit to 3.8% y/y growth. I would note that still puts the growth rate at the higher end of the range we’ve seen over the past 2 years. Retailers apparently saw some weakness after two very strong months. Auto sales fell but restaurants and furniture sales improved. Despite the disappointment, Barron’s says “much of this report is constructive and won’t likely be holding down expectations for the holiday shopping season.” 

The Consumer Price Index (CPI)—a closely watched gauge of retail inflation—accelerated to 1.7% y/y growth in November from 1.6% in the prior month. The so-called “core” rate of inflation, which excludes food & energy, held steady at 2.1% y/y growth. Overall inflation levels are very tame but two areas are concerning: rent and medical costs. Rent for primary residence is up 3.9% y/y and medical care costs are up 4% y/y. And within that medical care category, health insurance inflation is 6%!. 

Improving economic data has pushed the Citigroup Economic Surprise Index up to +37. This is a gauge of trending strength in the economy, measuring whether economic data are coming in ahead or behind economists’ expectations. The index fell to -55 last winter but has staged a strong recovery.

Jim Paulsen of Wells Capital Management says the current market environment reminds him of the 1985-1988 time period. Weak economic growth, negative y/y corporate earnings, and poor investor sentiment reigned for a while, but those trends turned around the market was able to stage a huge rally. He cites the following positive factors: 
-    Earnings growth is now trending in the right direction
-    GDP growth is improving
-    Trump “pro-biz hope” could be stimulative
-    German and Japanese bonds yields are off of zero rates
-    Confidence in the recovery is taking hold

Mr. Paulsen believes stocks will lead bonds and cyclical sectors will lead the stock market. This could go on for a while before the rally “runs out of gas against higher rates.”


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

December 6, 2016

Stocks opened pretty flat this morning (Dow -7 pts; SPX +.1%). The telecom sector is up 1.2% in early trading and the semiconductors & banks are up about .5%. But most other groups aren’t moving much. The VIX Index is back down to 12 so the market is pretty complacent/calm. The dollar is up a bit today but has fallen over the last week or so. WTI crude oil is trading back down under $51/barrel. Bonds are roughly unchanged. The 5-year Treasury yield is hovering around 1.84% and the 10-year is trading at 2.39%. So not a very exciting day. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 23, 2016

he major stock market averages opened mixed this morning (Dow +32 pts; SPX -.14%) after hitting fresh all-time highs yesterday. The Russell 2000 Index, by the way, also hit a new high. Industrials and financials are up nicely but most other sectors are lower. Real estate and utilities sectors are down the most in early trading. And the gold miners continue to sink. Indicated market volatility (VIX Index) has fallen from 23 to 12 in the last 3 weeks. The VIX is up a bit this morning to trade around 12.8. The dollar continues to rise (now up about 3.5% this month) in the wake of the election and although gold is down 7% this month, most other commodities are holding in there. WTI crude is up a bit to trade around $48/barrel after the Iraqi prime minster said his country is willing to abide by an OPEC production cut. Bonds are selling off again today. The 5- -year Treasury yield is up to 1.85% (matching a 5-year high) and the 10-year is trading at 2.39%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

October 27, 2016

Stocks opened mixed (Dow +45 pts; SPX +.08%). The best performing sectors in early trading are telecom (+.8%) and healthcare +1%). Banks and biotechs are also up nicely. Gold miners, utilities and REITs are down. The VIX Index is up around 14.7 and VIX November futures are trading up to 15.7, so volatility expectations are rising again. WTI crude oil is up a bit, hovering around $50/barrel. Most other commodities (i.e. gold, copper, iron ore) are up as well. Bonds continue to sell off as yields march higher. The 5-year Treasury yield spiked to 1.34%, the highest since early June. The 10-year Treasury yield is up to 1.85%. The Federal Reserve’s monthly policy meeting is next week and traders are building in some expectation for a possible rate hike. As evidence, the 2-year Treasury yield is back up near .9% where it seems to climb every time Fed officials threaten to hike. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

October 12, 2016

Stocks rebounded modestly at the open (Dow +12 pts; SPX +.3%), led by the defensive sectors (utilities, real estate, consumer staples). Energy is lagging on lower oil prices. Biotechs are down again, and the Nasdaq Biotech Index is off nearly 20% so far this year. The VIX Index is up to nearly 16, suggesting higher expected volatility in stocks in the next 30 days. WTI crude is trading at $50/barrel. Oil could trade lower in the near term once traders realize the OPEC production freeze deal is more about words than action. The dollar is stronger on the day (but still down slightly on the year). Bonds are selling off again and yields are rising. The 10-year Treasury yield ticked up to 1.79%. And it does look like the 10-year bottomed convincingly back in early July so we could definitely see rates head higher. Remember, the 2016 high for the 10-year is about 2.2%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

July 21, 2016

Stocks opened lower this morning (Dow -17 pts; SPX flat). Energy, healthcare and consumer discretion are higher but just about every other sector is modestly lower. The VIX has fallen flat around 1 12, indicating low expected volatility over the next 30 days. The dollar is flat and commodities are higher on the day.  WTI crude oil is down a bit to $45.40/barrel. Bonds are lower again this morning with yields moving higher. The 5- and 10-year Treasury yields are up to 1.14% and 1.60%, respectively. 


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