Stocks Rally As Economic Data Signals 3.7% GDP Growth

Another Rally On Wednesday It was another record day for small caps and tech stocks as the Russell 2000 was up 0.68% and the Nasdaq was up 0.67% on Wednesday. The S&P 500 was up 0.86% to 2,772. The next big technical milestone is 2,787 which is the 2nd highest peak in history. It was…

The End Of The Buyback Blackout Period Is Helping Stocks

Buybacks Helping Stocks There were a lot of reasons stocks fell during the Q1 earnings season. The results were great, but stocks were in the midst of a sentiment shift catalyzed by the unwind of the short volatility trade. Since then, fears of geopolitical strife and trade wars have hurt performance. One of the lesser…

Refuting A Bearish Argument: The Economy Is Accelerating

Record Highs In Tech, Small Caps, And Microcaps I have been very bullish on stocks recently which has been the correct position to take as the S&P 500 has broken out of its recent tight range. It was up 0.07% on Tuesday. Tuesday was a microcosm of the recent action since the S&P 500 was…

Q2 GDP Expectations Continue To Climb

Motor Vehicle Sales Motor vehicle sales are a big portion of consumer spending which goes into GDP. I have been expecting 2018 motor vehicle sales to be weak, but I expect a pickup in GDP growth in Q2. As you can see in the chart below, total vehicle sales were 16.9 million which missed estimates…

Record High For The Nasdaq

Technical Break Out For Stocks Even though the S&P 500 only rallied 0.45% and the Nasdaq only rallied 0.69%, this was one of the best days of the year for the market because it was a break out. The Nasdaq hit a record high as Apple, Amazon, and Microsoft drove the index higher with record…

Earnings Growth For Q2 Expected To Be 18.9%

Great Earnings Coming in Q2 The financial media acts as if the earnings reporting season is the only time that earnings matter and acts as if stocks beat estimates they should move higher. Those are incomplete understandings of earnings. Firms are expected to beat estimates, so raising guidance and beating the whisper number are more…

Stocks Rally On Strong Jobs Report

Stocks Still Range Bound The stock market rallied sharply on Friday because of the great jobs report. The S&P 500 was up 1.08% and the Nasdaq was up 1.51%. It’s very rare to see the stock market rise and oil fall, but that’s what happened on Friday as WTI fell 3% to $65.81. The spread…

Core Inflation Is Just 1.8%

Inflation Stays Moderate On Wednesday, the Fed’s Beige Book said inflation was moderate in most districts. That was a reflection of past data. I mention this because the latest Personal Income and Outlays report shows the previous trends have continued. As you can see from the chart below, the year over year PCE was 2%…

Stocks Fall On Fears Of A Trade War

Italian Situation Resolved Global market action has been unreal this week. As you can see from the chart below, the Italian 2 year bond had a panic moment where it went from a negative yield to almost 3%. Now it has fallen back to below 1% in just 2 days as traders act as if…

Stocks Rally, Forgetting About The Italian Political Crisis

Fed No Longer Too Dovish There was so much happening on Tuesday, I didn’t get to the effect the Italian political drama had on the Fed funds futures. The Fed funds futures were leaning towards 4 rate hikes in 2018 up until the Fed Minutes which dampened the market a bit. Still, the Fed pushing…