Tech Boom Turns To Bust As The Nasdaq Has Its Worst Week Of 2017

Friday was a great day for the market as most sectors were up. Energy and the financials did well as the S&P energy sector was 2.48% and the S&P financials sector was up 1.93%. However, in the afternoon the technology sector had a bit of a flash crash led by NVIDIA which was down 6.46%…

Atlanta Fed Downgrades Q2 GDP Growth Estimate To 3.0%

Regional Banks Soar It was interesting to see the financials rally on Friday given the problems with getting Dodd-Frank repealed. After falling 12.37% from its high on March 1st to its low on June 6th, the KRE regional bank index is up 7.13%. As I said, the Dodd-Frank repeal isn’t going as smoothly as the…

Consumer Comfort Remains High

The weekly Bloomberg Consumer Comfort index was released Thursday morning. It fell from 51.2 to 49.9. This was the first decline in 4 weeks. Confidence among Republicans decreased, while it increased among Democrats. This shows the partisan differences are disintegrating. This makes sense because now that the election is over, the questions can be answered…

ECB Lowers 2018 Inflation Forecast To 1.3%

The stock market was up modestly on Thursday after the big news surrounding the Comey testimony and the ECB statement were released. It’s now focusing on the U.K. elections which will affect Friday’s trading. The market has been so quiet, small moves that these events cause look like big moves because volatility has vanished this…

The ‘Euphoriameter’ Is Near The 2014 Peak

Are We At The Euphoria Stage? Despite the potential for volatility on Thursday, the stock market hovered near its all-time high. The VIX once again stayed at the 10 handle. The chart below takes the excitement seen in the low VIX, high forward PE multiples, and bullish sentiment and combines them to create the Euphoriameter.…

The Day Before Comey’s Testimony & The ECB Meeting

Wednesday’s market action was tepid because it is the day before two important events. The former FBI director, James Comey, will be testifying in front of Congress and the ECB will be meeting tomorrow. There’s not much I can say about Comey’s testimony which will add to the conversation about the potential political consequences for…

ISM & JOLTS Are Solid Despite Citi Surprise Weakness

In my last article, I mentioned the April JOLTS labor report which was released Tuesday. Let’s look at it more closely because it’s known as Janet Yellen’s favorite labor report. Personally, my favorite labor report is the Atlanta Fed’s 3-month smoothed average of wage growth, but everything is worth reviewing. The JOLTS report was good…

Stocks & Treasuries Are Living In Separate Worlds

The stock market and the bond market are in two separate worlds. Ever since the March bottom at 2.64%, the ten-year bond has been rallying. The selloff after the all-time low in yields in the summer of 2016 didn’t even get the yield to have a higher high. The downtrend in yields is still intact.…

The Stock Market Barely Moves As It Awaits Fed Meeting Next Week

The stock market on Monday had another sluggish day as the trading range was tight. In the past 27 years the S&P 500 has had 15 days with ranges of less than 0.25% and four of them have been in the past month. It’s quite unusual action. I think this trend of low volatility begets…

Earnings Expectations Have Declined Less Than Average

The S&P 500 earnings season is almost completed. Q1 operating earnings, which are 97.3% completed, were $27.90 on a bottom up basis. That’s the third highest earnings in history. On an as reported basis, earnings were $27.60 which is the highest ever. Operating margins increased from 8.75% in Q1 2016 to 9.89%. It was a…