Stocks Crater On Tariff Announcements
Stocks Crash & The Long Bond Rallies Thursday was a horrible day for the stock market as the S&P 500 fell 2.52%. It is now down 7.98% from the all-time high. It’s only up 2.43% from the correction bottom in February. The market is now down for the quarter which is over next Friday. The VIX…
Yield Curve Steepens After Fed Meeting
The Markets’ Reactions To Fed Decision The Fed raised rates by 25 basis points and increased the guidance for rate hikes in 2019 and 2020. I consider this to be a hawkish decision. We’ll go over the wording of the statement in this article, but first let’s look at the markets’ reactions to this decision…
Fed Hikes & Raises Forward Guidance
Fed Raises Rates In A Hawkish Hike As expected, the Fed raised interest rates by 25 basis points. In my opinion, the hike was hawkish because the Fed was one vote away from switching its expectations to 4 hikes this year instead of 3. My expectations have been slightly more dovish than the street because…
Yields Rise As Markets Await Fed Meeting
Stocks Rally Slightly The S&P 500 was up 0.15% on Tuesday. It’s surprising to see the Nasdaq was up 0.27% since Oracle was down 9.5% on weak guidance and Facebook was down 2.6%. The S&P 500 is almost exactly in the middle of its range. I’ll say the range started on February 9th which was the day…
The Media Strikes Back Against Facebook
Facebook Continues Its Decline Facebook stock was down 2.6% on Tuesday as the headlines about the Cambridge Analytica story swirled. I have a new perspective on the story which I don’t think others have covered. This situation is all about stakeholders in the company. Facebook will have an extremely tough time satisfying stakeholders because almost…
Stocks Fall As February Economic Data Has Been Weak
Stocks Fall Sharply On Monday There was a steep decline on Monday, which pushed the S&P 500 towards the lower end of the range it has been in for the past few weeks. The S&P 500 was down 1.42% and the Nasdaq was down 1.84% because Facebook’s 6.8% decline dragged it down. Even though the market doesn’t…
Facebook Stock Gets Knocked Down By Cambridge Analytica Story
International Markets Drive Revenue Growth It’s not a surprise the small caps, which are mostly domestically focused, have lagged the S&P 500 in terms of margin expansion and revenue growth because the domestically focused firms in the S&P 500 have had slower growth than international firms for the past few quarters of this expansion. This…
Small Businesses The Most Optimistic Since 1983
Small Businesses Optimistic Even though it seems impossible, the small business optimism increased even more in the most recent report. As you can see from the chart below, the index was up 0.7 points to 107.6. The improvements came because of the tax cuts and the improvement to the regulatory situation. We often hear about…
Strong Manufacturing In February, But Weak Q1 GDP Likely
Growth Expected To Fall My favorite indicator for studying future economic growth is the ECRI weekly leading index. While the ISM reports told you growth was accelerating in the first two months of the year, the ECRI forecasted growth would fall. Not only did it likely get the forecast right, it also told you this…
10 Year Yield Sentiment Is Very Bullish
10 Year Bond Yield The 10 year bond yield fell about 1 basis point to 2.82% on Thursday. The yield is about 1 basis point above the March first low. I have become increasingly bullish on long term bonds. I am bullish because growth expectations should be coming down in the next few weeks. As…
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