Archive for November, 2016

• Is the market getting the Fed wrong…again?
  Eddy Elfenbein, November 17th, 2016 at 10:03 am

• Morning News: November 17, 2016
  Eddy Elfenbein, November 17th, 2016 at 7:05 am

  Bank of Japan Keeps Rates Ready for Something Bigger

  Philippines Posts Strongest Economic Growth in Asia at 7.1%

  U.S.-China Panel Says Should Ban China State Firms From Buying U.S. Companies

  Uber Says Taiwan Should Let the People Decide Whether It Can Stay

  European Autos Mixed After Car Registrations Stall In October – VW, Peugeot Sales Down

  Oil Demand Won’t Peak Before 2040, Despite Paris Deal: IEA

  Trumpflation: Not Now, Maybe Later

  The Greenback Remains Resilient

  Snap’s IPO Will Test How Much Unicorn CEOs Are Actually Worth

  Goldman Sachs, Bank to the Elite, Makes Pitch to the Masses

  Bill Gross Just Clashed With World’s Biggest Hedge Fund Over Donald Trump’s Economics

  Neiman Marcus Taps Rent the Runway in Search of Younger Shoppers

  JPMorgan Is Said to Settle Bribery Case Over Hiring in China

  Roger Nusbaum: It’s Getting Real in the Fixed Income Market

  Josh Brown: These Are The Highlights

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• Bank Stocks Slide
  Eddy Elfenbein, November 16th, 2016 at 4:08 pm

• Morning News: November 16, 2016
  Eddy Elfenbein, November 16th, 2016 at 7:10 am

  Another Financial Warning Sign Is Flashing in China

  EU Warns 8 Countries of Possible Budget Blowouts in 2017

  U.K. Jobless Rate Falls Amid Signs Labor Market May Be Cooling

  Fed’s Bullard Sees Medium-Term Boost From Trump Spending

  Trump Allies Urge Fed to Shrink Balance Sheet as Debt Wall Looms

  Shoppers Ramp Up Spending Ahead of Key Holiday Shopping Season

  Snapchat Parent Files for $25 Billion IPO

  Ford Going Ahead With Moving Small Car Production to Mexico -CEO

  Lowe’s Cuts Profit Forecast Again, Says Low Traffic Hit Third-Quarter Results

  Home Depot Beats Street 3Q Forecasts

  Google to Expand London Campus Despite Brexit Questions

  Target Corp. Raises Profit Forecast; Earnings Rise

  Statement on Trump Puts New Balance Shoe Company in Cross Hairs

  Howard Lindzon: Trade from Fidelity, ETrade, TD Ameritrade, Robinhood and Scottrade DIRECT From Stocktwits…

  Roger Nusbaum: A Dark Gray Swan?

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• The Bond Market Selloff
  Eddy Elfenbein, November 15th, 2016 at 12:54 pm

  The long-end of the bond market is experiencing one of its most dramatic selloffs in years. One measure that technicians use is called RSI. For the 10-year, the RSI flashed its highest reading since 1990.

  It’s hard to show graphically just how steep this selloff has been. I gave it a shot with this oddly colorful chart below.

  

  From the bottom, the four lines are the five-, ten-, 20- and 30-year US Treasury yields. Note the pronounced upticks on the right. Interestingly, the rise in yields appears to be roughly similar for the different maturities.

• October Was a Strong Month for Retail Sales
  Eddy Elfenbein, November 15th, 2016 at 9:19 am

  Today’s retail sales report showed that October sales rose by 0.8%. That was 0.2% more than expectations. The number for September was revised up to 1%. Over the last year, retail sales are up 4.3%.

  “A strong October following a strong September is encouraging,” Tom Simons, a senior economist at Jefferies LLC, said before the report. “The labor market continues to be strong, and wage growth appears to be accelerating.”

  Sales improved in 11 of 13 major categories for a second straight month in October, the report showed. That included the biggest advance in five months at Internet retailers and the strongest month for apparel chains since February.

  Furniture outlets and restaurants were the only major categories registering a decline in October sales.

  Auto purchases remained robust, climbing 1.1 percent after a 1.9 percent increase.

  That’s consistent with industry data that showed the torrid demand is continuing. Purchases of cars and light trucks grew at a 17.9 million annualized rate, the strongest pace since November of last year, after 17.7 million the previous month, according to Ward’s Automotive Group.

  We’ll get an earnings from Ross Stores (ROST) on Thursday.

• Bank Stocks Soar as the Sectors Rotate
  Eddy Elfenbein, November 15th, 2016 at 7:55 am

  Imagine if someone told you earlier this year that both Brexit and Donald Trump would win, and the market’s reaction to both would be a big bank stock rally. It sounds crazy, but that’s what exactly happened. A populist pulled off a surprising upset and shares of Goldman have rallied!

  Check out this graph of four major banks since Brexit:

  

  On our Buy List, shares of Wells Fargo haven’t done nearly as well, but Signature Bank has gained 28.3% in the last four weeks. The Dow has now rallied for six days in a row. Also, the Russell 2000 just touched its first all-time high in 17 months.

  Here’s a look at the Russell 2000 divided by the S&P 500. You can see just how sharply the market has turned its attention to smaller-cap stocks.

  

• Morning News: November 15, 2016
  Eddy Elfenbein, November 15th, 2016 at 6:51 am

  Yuan Slides to Lowest Level in Nearly Eight Years

  British Inflation Falls To 0.9% – Competition Might Stop Predicted Higher Rates Arriving

  Weak Investment Knocks German Economy

  Inside Merkel’s Dilemma in World of Trump

  Japan Watches Samsung Chip Away at Its Car Makers

  Singles’ Day Sales Scorecard: A Day In China Now Bigger Than A Year In Brazil

  Oil Prices Up 2% on Hopes of OPEC Output Cut

  Mary Jo White to Step Down as S.E.C. Chief

  EasyJet to Set Up Operating Company in Another EU State

  Reynolds Said to Reject BAT’s $47 Billion Acquisition Proposal

  Vodafone Loss Widened by Hefty India Write-Down

  Apple Stock Extends Losses After China Warning About Trump

  Dirty Linen: A Bed Sheets Scandal Hits the Cotton Industry

  Howard Lindzon: A Trillion Here a Trillion There…Welcome to Trump University (Stock Market Class)

  Josh Brown: We Got It From Here… Thank You 4 Your Service

  Josh Brown: QOTD: “No One Has Ever Seen Anything Like This.”

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• Our Buy List Rallies
  Eddy Elfenbein, November 14th, 2016 at 4:53 pm

  This will go down as one of the best years for our Buy List. With 1-1/2 months to go, our Buy List is trailing the S&P 500, -0.06% for us to 5.86% for the S&P 500, not including dividends.

  The good news is that we’ve done very well in the past three weeks. In fact, this period is one of our best periods relative to the market in quite some time.

  Since October 27, our Buy List is up 4.47% to the S&P 500’s gain of 1.46%. That’s a big move for a diversified portfolio.

  

  I’m not trying to sugarcoat a year which has been quite challenging. I’m merely pointing out that our Buy List is still holding its own.

• Stocks Divided by Bonds
  Eddy Elfenbein, November 14th, 2016 at 1:57 pm

  This simple chart tells you the story — stocks are up and long bonds are down.