Welcome Stockaholics to the trading week of June 10th! This past week saw the following moves in the S&P: Major Indices End of Week: Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday Mexico tariffs deadline 10:00 a.m. JOLTS Tuesday 6:00 a.m. NFIB survey 8:30 a.m. PPI Wednesday 8:30 a.m. CPI 2:00 p.m. Federal budget Thursday 8:30 a.m. Jobless claims 8:30 a.m. Import prices Friday 8:30 a.m. Retail sales 9:15 a.m. Industrial production 10:00 a.m. Consumer sentiment 10:00 a.m. Business inventories
FedSpeak Sparks Best Week For Stocks In 6 Months; USD & Yields Plunge Alt-headline: "Markets Jump On Optimism US Economy Sliding Into Recession" But, for those relying on help to save the day, The Fed won't cut rates until stocks plunge, which won't happen because the Fed is expected to cut if stocks plunge... NOTE - after being panic-bid every day into the close, Friday saw weakness. This was the best start to a June since 2000... And best week since November for US stocks... NOTE - we have seen this pattern before and it did not end well. While a somewhat nonsensical way to look at things, we note that this week saw the biggest point gain for the Dow in history... Dow 26,000 remains a key level... (Dow crossed above all its major moving averages this week)... But The Dow ended back below 26k... Intraday, Dow futures went nowhere from the European close onwards today... US Materials stocks soared... Having their best week in 10 years... FANG Stocks surged on Tuesday and Friday ... MSFT hit a new record high above $1 trillion market cap today... After the initial surge on Tuesday, Defensive stocks have notably outperformed Cyclicals... VIX and Stocks dramatically diverged today (upside call-buying or downside-protection bid?) While US markets soared, Chinese stocks tumbled, breaking below key support levels and entering a bear market... But European markets also surged this week... And this chart sums it all up... Treasury yields are lower today, shifting most of the curve notably lower on the week (30Y underperforming) Yields touched new cycle lows intraday today... But 10Y Yields have traded in a tight range all week... On the week, expectations for rate-cuts in 2019 continued to escalate as various Fed heads jawboned the markets higher with promises of rate-cuts... Bond volatility has exploded - idiosyncratically - this week... The Dollar plunged this week - its worst since March 2018...to its lowest since mid-April... While the dollar tumbled, so the yuan tumbled even further against the dollar, testing below the recent lows of the range (down to the weakest since Nov 2018) before bouncing back today... NOTE - look how tight the range has been in the last few weeks. Cable rallied on the week - for a change... And we note The BoJo is now at 66% odds of winning. The peso trod water (admittedly with lots of headline vol) after plunging on tariff headlines last week... Cryptos rallied to end the week, lifting Ripple to unch and Litecoin into the green... Bitcoin back above $8k today... PMs led the week (as the dollar tumbled), oil bounced today back into the green for the week, but copper dipped... Dr.Copper is down 8 weeks in a row (the most since Oct 2016 - after Brexit)... What is that saying about the economy? Gold had its best week since April 2016 and is up 8 days in a row...topping the Maginot Line of $1350... $1350 has been a line in the sand for gold for a few years... This is the longest win streak for gold since 2011 Gold in Yuan surged on the week to its highest since April 2013... So, Finally, what drove this week's almost unprecedented surge in stocks? Simple - Trump launching Mexican, Indian trade war; US labor market cracking; US GDP slowing; German manufacturing collapsing; S. Korean export drop needs a bigger chart; Global PMIs plunging; bond yields crashing... And 13 Fed Speakers all singing dovishly from the same plunge-protecting hymn-sheet. Bad news is good news once again... Global economic surprise data has now been negative since April 2018 - the longest period on record. * * * Bonus Chart: Trading at 27x forward Sales, Beyond Meat sums up the entire market... It's fake!
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2019- S&P sectors for the past week-
Not a Triple Top Yet – Support Has Held There has been a lot of chatter recently about an imminent “triple top’ for the market across the January 2018, September 2018 and recent April 30, 2019 highs. It’s not a triple top until it breaks support levels. Traders do need to be watching for support levels to be broken - which we have recently held. Holding support was bullish technical action. But remember this is the Worst Six Months and we expect more volatility, more testing of support and more sideways action – backing and filling – over the weaker summer months. We talked about these support levels on the blog a month ago as well. Here’s an update to the chart from that May 7 blog post. I added some additional support levels. S&P 500 level of 2580 at February/April 2018lows is critical support – a 12.4% correction. Breaking that level would bring the December 2018 lows into play, which would be bear market territory of -20% – and likely the low and a great buying opportunity. Good thing we are already in Worst Six Months Defense Mode since we shifted to market neutral after our official Best Six Months MACD Seasonal Sell signal for DJIA and S&P 500 on May 1. Seasonally, Bonds Have Plenty of Room Left to Run Barring some rather abrupt reversal in the current trend in trade, tariffs, tariffs and even higher tariffs, bonds could have even more upside in their near-term futures. Back in the beginning of April we noted the 30-year treasury bond had a seasonal tendency to dip in April and early May (around the time stocks like to make a seasonal high) before moving higher from sometime in May through the end of August. Thus far this year this trade has been a perfect textbook setup. In the following chart weekly bars of the 30-year Treasury bond future appear on top with their seasonal trend since August 26, 1977. The 30-year Treasury bond did dip in April and as trade war concerns grew in May, as stocks slipped, bonds ripped higher. The recent rise has been brisk but considering the retreat in tech stocks further gains are not out of the question. The Bespoke Report -- Negative Void Coefficient Fri, Jun 7, 2019 Equity markets surged despite short term interest rate markets pricing near-certainty of multiple Fed rate cuts this year. How can an economy so bad that the Fed needs to cut mean stocks go up? We take a look around for some answers. We also review just how dovish the Fed has been relative to what markets have been pricing of late. While the domestic economy has definitely slowed down from the torrid pace of 2018, even the disappointing nonfarm payrolls number today paints a different picture than assumptions of multiple cuts from the front end. The global economy is less constructive, but there's a difference between weakness and a recession panic, as we show. Finally, we present an argument for why Fed rate cuts may not be necessary for the economy to stabilize and start to pick up again thanks to negative feedback loops.
Here are the current major indices pullback/correction levels from ATHs as of week ending 6.7.19- Here is also the pullback/correction levels from current prices- ...and here are the rally levels from current prices-
Stockaholics come join us on our stock market competitions for this upcoming trading week ahead!- ======================================================================================================== Stockaholics Daily Stock Pick Challenge & SPX Sentiment Poll for Monday (6/10) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (6/10-6/14) <-- click there to cast your weekly market vote and stock picks! Stockaholics Weekly T/A Charting Challenge (6/10-6/14) <-- click there to participate! ======================================================================================================== It would be pretty sweet to see some of you join us and participate on these! I hope you all have a fantastic weekend ahead!
Stock Market Analysis Video for June 7th, 2019 Video from AlphaTrends Brian Shannon ShadowTrader Video Weekly 6.9.19 Video from ShadowTrader Peter Reznicek (VIDEO NOT YET UP!)
Here are the most anticipated Earnings Releases for this upcoming trading week ahead. ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 6.10.19 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 6.10.19 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 6.11.19 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 6.11.19 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 6.12.19 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! NONE. Wednesday 6.12.19 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 6.13.19 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 6.13.19 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 6.14.19 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! NONE. Friday 6.14.19 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
And finally here is the most anticipated earnings calendar for this upcoming trading week ahead- ($LULU $THO $AVGO $UXIN $HRB $RH $PLAY $HDS $FGP $LOVE $CHS $TLRD $SECO $DLTH $SHLO $ASNA $CPST $JW.A $AZRE $ADXS $CASY $LMNR $BBCP $NEPT $OXM $SPCB $DEST $TMDX $CBKC $TUFN $LIVX $RENN $SMMT $CRWS $UROV $CUP) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning June 10th, 2019 <-- click there to view!
Trump says the US and Mexico have reached a deal to avoid tariffs https://www.cnbc.com/2019/06/07/tru...ico-have-reached-a-deal-to-avoid-tariffs.html Let's see if the futures will gap up on Sunday evening
Judging by how hard the stock market has rallied in the last few days, it seems like 2 - 3 rate cuts have been priced in. The problem with this however, is that no matter how much Powell cuts rates, it still doesn't address the issue that mass redundancies are happening across the board; moreover, rate cuts don't just magically make laid-off jobs reappear. There have been over 7200 retail store closures to date in 2019, and recently Ford, GM, 3M, IBM, MGM Resorts, among other notable names have announced large redundancies. Despite this, the government keeps harping on about how low unemployment rates are and etc. What's surprising is just how low the barrier to entry is for people to be considered as "employed" by the government, which has led to an entirely new issue all together: "Underemployment" or "Underemployed". If the DLS disclosed what their definition of "employed" actually is, then stacked both the unemployment and underemployment numbers next to each other, we get a whole different story all together.
Good Monday morning to all. Here is this morning's pre-market news thread for those of you wanting to get a quick read before today's open- <-- click there to read! Hope everyone has a great trading day and week ahead.
Morning Lineup - Merger Monday Provides a Positive Encore Mon, Jun 10, 2019 After the first 'perfect' week for the DJIA since May 2018, a slew of mergers and the deal with Mexico are helping to kick off the week on a positive note providing a nice encore to last week's gains. In terms of economic data, the week is starting off slow but will progressively pick up as the week goes on. Sectors have seen quite a move within their trading ranges over the last week. As shown in the chart below, at this time a week ago the S&P 500 and every sector were trading below their 50-day moving averages and most were oversold. Fast forward five days and there are now just three sectors below their 50-DMA, and Energy is the only sector that is oversold. Meanwhile, both Consumer Staples and Utilities have moved back into 'extreme' overbought territory. As far as the major averages are concerned, while the S&P 500 is trading back above its 50 and 200-DMAs, the Nasdaq 100 is still below its 50-DMA, and the Russell 2000 isn't above either of those thresholds. If the rally is going to keep on going, they have a lot of catching up to do.
Gauging the Bounce The average S&P 500 stock fell 6.2% from 4/30 (when the index made its last all-time closing high) through last Monday (June 3rd). Since the close last Monday, the average stock in the index has bounced back 4.1%. Below is a look at how stocks within sectors have performed recently. During the pullback from 4/30 to 6/3, Energy stocks fell the most of any sector at -13%. Energy stocks have also bounced back the least since 6/3 with an average gain of just 2%. Technology stocks fell the second most during the pullback with an average decline of 11%, but Tech has bounced back the most since 6/3 with an average gain of 6.3%. Notably, some sectors have seen average gains since 6/3 that are bigger on an absolute basis than the declines they saw during the pullback. The average Utilities stock was flat from 4/30-6/3, but since then the average stock in the sector has rallied 2.1%. The average Real Estate stock actually gained from 4/30-6/3, and since then the sector has seen an average gain of 2.2%. Consumer Staples and Health Care both saw average declines of roughly 3% during the 4/30-6/3 pullback, and they have bounced back by an average of just over 4% since 6/3. Below is a look at the best performing stocks since the S&P's recent closing low on 6/3. Advanced Micro (AMD) is up the most of any stock in the S&P with a gain of 17.51%. Campbell Soup (CPB) -- a company that couldn't be much more different than AMD -- is up the second most since 6/3 with a gain of 15.28%. American Airlines (AAL), Brown-Forman (BF/B), and Salesforce (CRM) round out the top five with gains of more than 11% each. Other notables on the list of winners include Chipotle (CMG), Twitter (TWTR), Under Armour (UAA), Apple (AAPL), MasterCard (MA), Microsoft (MSFT), and NVIDIA (NVDA). Below is a list of the 22 stocks in the S&P 500 that have the distinction of being down since last Monday. Kohl's (KSS) is down the most with a decline of 4.18%, followed by Cimarex (XEC), Noble Energy (NBL), and Macerich (MAC). Other notables include retailers like Macy's (M), Gap (GPS), Nordstrom (JWN), and L Brands (LB).
Broad Participation During Last Week's Rally The average stock in the S&P 500 has gained 4.14% since last Monday's near-term closing low. Usually, when we see such a strong bounce after a period of weakness, we see the stocks that were down the most during the pullback rally back the most during the bounce. That hasn't been the case this time around, though. We broke the S&P 500 into deciles (10 groups of 50 stocks) based on stock performance during the market's pullback from 4/30-6/3. We then calculated the average performance of the stocks in each decile since 6/3. As shown in the chart below, each decile has seen an average gain between 3.34% and 4.69%. The stocks that held up the best during the pullback are up an average of 3.61% since 6/3, while the stocks that fell the most during the pullback are up an average of 3.89%. We usually see more disparity between these two deciles in this type of market environment. Instead of bidding up the biggest losers during the sell-off, last week's rally was much more evenly distributed. One stock characteristic that did have an impact was international revenue exposure. During the market's sell-off in May on trade fears, S&P 500 stocks that generate the bulk of their revenues outside of the US were crushed. Stocks with all domestic revenues that are much more insulated from tariffs held up much better in May. We've seen outperformance from stocks with heavy international revenue exposure since last Monday. As shown below, the decile of S&P 500 stocks with the most international revenues has posted an average gain of 5.85%, while decile 2 has posted an average gain of 5.68%. On the flip side, stocks with nearly all domestic revenues are only up 2.6% on average since last Monday. The "internationals" are still down quite a bit from their Q1 highs, so if trade concerns continue to ease, these stocks stand to benefit the most. Bespoke maintains an "International Revenues" database that allows subscribers to find the geographic revenue breakdown for all stocks in the Russell 1,000 and S&P 500.
