Small Caps Outperform Large Caps
Small Caps Earnings Growth Falls But Financials Look Good Even though the Russell 2000 was down slightly on Friday, the small caps are still in the best streak since the post-election run. The chart below shows the rally after the election was justified given the accelerated earnings growth after the earnings recession in 2015-2016. Unless the…
Jobs Report Misses Badly, Stocks Shrug
As expected, the employment report was severely impacted by the hurricanes. It was hurt much more than I thought or what the consensus expected. The expectation was for 90,000 jobs created, but the results were a 33,000 decline. Not only was September’s number weak, but the combined revision of the past 2 months was 38,000…
Record Low VIX
Record Low VIX Close Thursday was another fantastic day in the stock market as all major indexes were up and hit record highs. The VIX was down 4.57% to 9.19. As you can see from the chart below, that’s the lowest close since 1990. Not only have we had the lowest close ever this year,…
Neel Kashkari Is Pumped By Gundlach
Neel Gets A Brief Surge Before Falling Wednesday was a very interesting day for the Fed prediction market because Neel Kashkari made his debut. This was spurred by Jeffrey Gundlach’s interview on CNBC where he named Neel as his non-consensus pick. The ironic part of this is that his non-consensus pick became the consensus pick…
An Analysis Of The ISM Results
Manufacturing ISM Because of how remarkable the manufacturing ISM report was there were many extra analytical charts created which I didn’t get to. Let’s look at some more analysis of the manufacturing economy before moving on to the news of Wednesday which was the ISM non-manufacturing report which many consider more important because the services…
The Animal Spirits Are In Full Force
The stock market had another move higher on Tuesday as my near term bearishness on the small caps and microcaps has been proven incorrect. The Russell 2000 - RUT is now up 8 straight days and the IWC microcap index is up 29 out of the past 31 days. We are certainly in one of the calmest…
Warsh Still Leads The Fed Race
Powell Versus Warsh The movement in the betting market for who will be the next Fed chair was sharp on Tuesday as news leaks out about who President Trump is considering. I’ve long been high on Warsh being picked and pessimistic on Cohn and Yellen’s odds. That perspective has proven to be accurate as on…
ISM Shows Manufacturing Is At A 13 Year High
In an unusual circumstance, the ISM manufacturing index was one of the most discussed topics in the financial world because it hit its 13 year high. This led to much more analysis done on the report than usually occurs. The ISM saying manufacturing is the strongest in 13 years is a major proclamation which can…
Micro Cap Stocks Continue Their Massive Outburst
Micro Caps Are Exploding Monday’s stock performance was shocking given the recent run the small caps and micro caps have been on. The Russell 2000 was up 1.25% which means it’s up 11.24% since August 21st. It has been up 7 days in a row and 23 of the last 28 days. The Russell 2000…
Chicago PMI Report Was Fantastic
Q2 GDP & Corporate Profits We got more support for the thesis that Q2 will be the fastest growth quarter of the year on Thursday as the GDP report was revised up to 3.1% from 3.0%. This increases the size of the drop that will occur in Q3. The improvement was actually slighter than meets the eye…
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