This week saw a re-test of the October lows. That is to be expected in most stock market corrections. What is important to the future well-being of equities globally is that the averages do not decline much further from here.
At the Market
Stocks are in the process of consolidating after the big gains over the last week or so. So far, the October sell-off has led to a recovery of about half of what was lost. In the two months ahead, we should see even further gains.
It happened like clockwork. Earlier in the week, all three main U.S. averages re-tested their lows and then proceeded to bounce back, only to give it all back. That’s what happens during corrections, but it is not over yet. Afterall, it is October. Readers will recall that last week I wrote that nine out of ten times markets will re-test their recent lows. Naturally, this is more of an art than a science, so prices can bottom somewhat above or below those lows. In this case, the Dow hit its lowest level in four months. The S&P 500 Index slipped…
It never fails. A couple weeks of declining markets and everybody becomes bearish. “New bear market unfolding,” “An end has a start,” or “More evidence of a global bear market” are just some of the headlines I’ve read in the past week. How did we go from bullish to bearish in such a short time period?
Right about now, most investors are feeling sick to their stomachs. All three averages have plummeted this week and the selling does not appear to be over. We have all been here before. This time is no different.
After this week’s trade deal between the U.S., Mexico, and Canada, investors are waiting to see if China will now come to the table. What would it take for that to happen?
Today marks the end of the third quarter for stocks in 2018. But it is the fourth quarter that will determine what kind of year it will be. Let’s place our bets.
The Dow and the S&P 500 Indexes made record highs this week. That’s right, we broke the levels of January and we closed out the week holding these new higher levels. So much for the bear’s prediction of a 5-7% pullback.
Next week, Wall Street’s big boys return to their offices. Campaigning for mid-term elections moves to the front burner, and tariff threats between the U.S. and China will likely escalate. Welcome to one of the worst months of the year for stocks.
As of Friday, we were in striking distance of a record high on the S&P 500 index. We have been here before, but something tells me that this time we just may break through. But for how long? Granted, stock market volumes are exceptionally light, which is understandable, since we are heading in to one of the slowest weeks of the year. That makes any new highs suspect until volume improves. We would need to wait another week or so for that to occur. Next weekend is Labor Day and it is only after the holiday that the Big Boys…
It is that time again. Stocks are entering the weakest time of the year on a seasonal basis. It is also a mid-term election year. Both factors could combine to keep the averages in place for a few months longer.
The S&P 500 index is within a hair’s breadth of breaking out. This week we topped 2,850, which we haven’t done since March. The record high for the index in January was 2,872. Can we top that?
This month would be a good time to go on vacation. Otherwise, you might be tempted to do something rash like chase stocks or sell at their lows. That is the kind of market volatility investors should expect in August.
As the second quarter earnings season go into full swing, investor’s focus is divided between what is happening on the trade front and the latest earnings result. Overall, good earnings are trumping Trump’s trade war for now.
It’s the same old song. It has been playing over and over since the end of January. Higher interest rates, a stronger dollar, and, of course, the inevitable and meaningless stream of tweets from our Tweeter-in-Chief are keeping stocks range-bound. How long will this condition persist?
While the stock markets meander through this sultry summer, bond investors are glued to the yield curve. What, you might ask, is the yield curve?