Markit US Manufacturing PMI

STOCKS DOWN WITH HEADLINES

Stocks sank at the open, as is their custom this month. The Dow is currently down 367 pts and the SPX is down 1.5%. Energy is the worst performing sector, down 3.5% (see below). Most other sectors are down about 1% except the defensives (utilities, consumer staples, real estate). VIX Index June futures are trading up around 17, but that’s not considered elevated. There’s no real panic in the market, just a slow bleed on trade headlines. European stock markets closed down about 1.5% today and Asia was uniformly down overnight. The bond market is catching a bid—especially safe-haven Treasury bonds. The 10-year Treasury yield is down to 2.32%, the lowest level since November 2017.


*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, 2018

December 6, 2018

Stocks sank at the open despite better than expected economic data. For the first couple of hours, most major market sectors were down more than 3% before bouncing off the lows. This could be the correction’s capitulation flush. While the Dow was down about 770 points, it is now down 436 pts. The SPX is currently down 1.7%. The more defensive sectors (consumer staples, utilities) also dumped at the open but are trying to claw their way back. Foreign markets aren’t serving as a safe haven. European markets closed down more than 3%. Asian markets were down roughly 2% overnight. The dollar is weaker, but that’s not helping commodities, most of which are trading lower. WTI crude oil fell back to $50.60/barrel, but quickly bounced back over $51. Bonds are catching a bid as you might expect. The iShares 20+ Year Treasury Bond ETF (TLT) is up .6%. High-grade corporate bonds, which have lagged lately, are up as well today. Junk bonds continue to struggle. The 2-year and 10-year Treasury yields are down around 2.71% and 2.85%, respectively. The difference between those two yields, 14 basis points, is very small and that’s spooking equity markets. Looking back at the last two months, any volatility in rates has been greeted with fear. The market doesn’t like it when rates rise, and neither does it approve when rates fall. Both are somehow begin viewed as bad news.


*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, 2018

Stocks sank at the open in today’s holiday-shortened trading session. The Dow and SPX are currently down 140 pts and .4%, respectively. The energy sector is down 3.5% on falling oil prices. Energy is now the second-worst performing sector in 2018, behind communications services. On the other hand, transports, biotech & pharmaceuticals, semiconductors and retailers are trading higher today. The dollar is a bit stronger on the day (and up 5% so far this year), which is helping push commodity prices down. The Bloomberg Commodity Index is down 1.6% today. Bonds are trading slightly higher as yields tick downward. The 5-year and 10-year Treasury yields are now trading at 2.87% and 3.05%, respectively. And while junk bonds did very well earlier in the year, the SPDR High Yield Bond ETF (JNK) is down 4.5% since the stock market correction began in early October. All investors will be watching high-yield for signs of an economic slowdown.


*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 27, 2018

August 27, 2018

Stocks surged at the open after the US & Mexico announced a new trade deal. The Dow is up 263 pts and the SPX is up .8%. The cyclicals—financials, industrials, materials, technology—are up at least 1% in early trading. And overseas markets are doing very well. The EuroStoxx 50 Index is up .8%, the Nikkei rose .9% and even China’s Shanghai Composite Index rose nearly 2% last night. China’s central bank took steps to support its currency from further weakness, and that is being viewed positively. As a result, the dollar is weaker today and commodities are mostly trading higher. WTI crude oil is back up around $66.80/barrel. Bonds are selling off today as yields tick higher. Usually, when the dollar is weaker interest rates rise. The 5-year and 10-year Treasury note yields are hovering around 2.74% and 2.85%, 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 23, 2018

August 23, 2018

Stocks opened lower this morning (Dow -100 pts; SPX -.2%). Most market sectors are sagging, led by industrials, financials and materials. Only utilities, telecom, and some pockets of technology are in the green. The financial news media are blaming “trade tensions” as China-US negotiations continue in Washington. Exchange trade volume is very low, so today’s market action doesn’t necessarily represent any conviction on the part of traders. The dollar is stronger against a basket of foreign currencies after a report showing higher wholesale inflation in Europe. That’s putting some pressure on commodities. Copper is down 1%, gold is down .6%, and WTI crude oil is down .4% to $67.60/barrel. Bonds are trading slightly higher today. The 5-year and 10-year Treasury yields are hovering around 2.71% and 2.82%, 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 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.

September 22, 2017

Stocks opened slightly lower again today (Dow -29 pts; SPX flat).  Utilities, real estate and healthcare are leading to the downside. Telecoms, industrials and energy are in the green, however, continuing a recent trend. The VIX Index still isn’t registering much fear, trading just under 10. European markets are poised to close slightly higher today. And by the way, just about all the major European stock indexes are up more this year than the SPX or Dow. The dollar is weaker again vs. a basket of foreign currencies, and is down about 10% so far this year. That doesn’t really fit well with the Fed’s expectations for rising interest rates over the next year. In other words, if the economy is improving and interest rates are rising, you would expect a stronger dollar. Part of the reason for the weaker dollar is that foreign economies are faring better this year. Bonds are trading a bit higher today after a two-week drubbing. The 5- and 10-year Treasury yields edged back down to 1.87% and 2.26%, respectively. But it really does look like the 10-year yield will move up to test resistance at 2.39% soon. 


*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 23, 2016

Stocks opened higher this morning (Dow +32 pts; SPX flat). Materials and tech (semiconductors especially) are leading the way in early trading. Consumer related stocks are holding their own. Energy, utilities and telecom sectors are lower. The dollar is unchanged and commodities are modestly lower. WTI oil is down a bit to $48/barrel. Bonds are selling off again. The 2-year Treasury yield, which reflects Fed interest rate expectations, is trading up to .91%. That’s the highest since mid-March. The 10-year Treasury, which more closely reflects inflation expectations, is unchanged at 1.85%. 


*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 22, 2016

he major stock market averages held fairly steady following a terror attack in Belgium (Dow -32 pts; SPX flat; Nasdaq +.15%). It looks like two separate locations were bombed by ISIS; at least 200 people were injured. Not surprisingly, airline stocks are down about 2%. healthcare and technology sectors are modestly higher on the day. WTI crude oil is up to $41.50/barrel and Brent crude is very close to parity ($41.70/barrel). Oil’s rapid recovery flies directly in the face of most Wall Street analysts who say the actual demand/supply situation hasn’t changed at all. So the only thing that hasn’t changed is analysts’ inability to predict oil price moves. Bonds are roughly unchanged today (5-year Treasury yield 1.36%; 10-year yield 1.89%).


*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.