Manufacturing Sector Had a Weaker December
Apple Larger Than Energy Despite the huge growth in American oil production to a record high due to advancements in fracking, the energy sector’s weighting in the S&P 500 is the lowest since at least 1990. Part of that weakness might be because some view this production as unsustainable due to high decline rates. A…
2020 Predictions: No Rate Cuts, No Recession, Sell Apple, Buy Energy
Monday’s Decline The stock market has been on a rampage in the past few weeks. It has been due for a correction. Personally, I expect the start of 2020 to be volatile and see 3% to 5% gains in 2020. If you buy at the correction trough, it will be like a normal year of…
2020 Forecast: Election To Cause Volatility?
Trade Balance Helps GDP Estimates Let's first discuss the latest report on trade which boosted GDP estimates. Then, GDP Nowcasts and ECRI leading index which don’t include this latest data yet. Either way you look at it, GDP growth should be very close to 2%. That’s what I predicted back in November. If the PCE…
Sentiment Suggests A Pullback Is Near
Stocks Stay Overbought Stocks were on their way to another solid day, but they fell in the afternoon; the rally in the last few minutes of the session didn’t cancel out all the losses. Alas, the Nasdaq wasn’t able to hit a record high for 11 straight days. That would have been the longest such…
Improved Core Capital Goods Orders & CFO Confidence
Solid Core Capital Goods Orders Growth There are a few details that cloud the November durable goods orders report making headline growth not very useful. Some have argued that we should just look at the headline numbers because there are always one time factors that cloud them. Firstly, if there is always a reason to…
10 Straight Records For The Nasdaq
Stocks Rally Yet Again: Extreme Greed Remains Large cap stocks obviously increased on the day after Christmas since the stock market has a lot of momentum and it’s a great time of year calendar-wise. The stock market has been overdue for a correction for a couple weeks. But we haven’t expected one to occur in…
Strong December Holiday Shopping Sales
Consumer Looks Great Consumers had a great December which should boost PCE growth and GDP growth. Expectations for a strong holiday shopping season appear to have been met. But let’s wait until the retail sales report comes out before we declare victory. Wal-Mart, Amazon, Costco, and Target all did great. Sales are shifting online. But…
Stocks Have Risen 11 Of The Past 14 Days
Yet Another Rally: Euphoria Is Here The stock market increased again on Monday which isn’t a surprise given how much momentum stocks have and the calendar effect. S&P 500 is now up in 11 of the past 14 trading sessions. It's expected continue. According to FactSet, as of December 20th, the S&P 500’s forward PE…
The Consumer Had A Strong Holiday Shopping Season
December Retail Sales Should Be Great Final December consumer sentiment reading showed consumers as very confident. Sentiment improved, not that it was weak in November. It’s interesting that the savings rate increased in November. Even though it was during the holiday shopping season and consumers were optimistic. Last time spending was weak (December 2018), sentiment…
Rally Reaches Insane Proportions: Raise Cash!
Insanity Continues This bull market insanity continued on Friday as stocks rallied again! The stock market has momentum and the calendar effect is strong. However, this rally has gone too far. This is the exact opposite of December 2018 when stocks were cratering. It’s important to note that stocks exploded in 2019 because they started…