Paul Schatz, President, Heritage Capital

Two Enemies Of The Stock Market

It has been a heavy week in the stock market, especially in the NASDAQ 100. Every early rally has been met with selling and I have found very few things that are appealing enough to buy. On the flip side, because there hasn’t been any intervening rallies, not many things have looked appealing enough to sell. Below is a culprit, long-term interest rates. I will say this and be crystal clear. The bulls absolutely do not want to see the […]   Read More
Date: April 19, 2024

Pullback Proceeding On Schedule – Time Is Needed

Monday saw the largest down day since the stock market peaked last month. There was widespread selling with 90% of the volume in stocks going down versus up. Below is a chart of the S&P 500 with the 90% volume below. Over the past 6 months, we have seen two instances like this with stocks bouncing and then pulling back before heading to new highs again. Further supporting my thesis is the chart below. At the recent peak there were […]   Read More
Date: April 17, 2024

Seasonally Positive Tailwind Against Middle East Escalation

Happy tax day (said with sarcasm)! The stock market has been seasonally strong on tax day as well as the day after. First, the middle of the month typically sees inflows from 401K and other retirement plans. Add on top of that the billions in last minute IRA contributions and you have a nice tailwind for two days. I think the best way to play that is to buy weakness. If stocks up higher and continue to run, I would […]   Read More
Date: April 15, 2024

Stock Market Pullback Proceeding on Schedule – Gold, Apple & Nvidia

Since the March 27th peak, we have seen a few mild pullbacks in the major stock market indices. That March high although late in the quarter is precisely what our work had been suggesting since the year began. As usual, they didn’t make it easy. I remain of the opinion that it was not a peak of significance. Rather, the market would embark on a one to two month decline that would be less than 10% and bottom by Memorial […]   Read More
Date: April 12, 2024

All Eyes on CPI But Does It Matter?

With the Consumer Price Index due out at 8:30am, that is almost guaranteed to be the talk of the day. As I have been mentioning all year, my thesis is that inflation remains stubbornly elevated with 3% being the new 2%. I have been writing about inflation bottoming and the last few months have certainly proven that. I don’t have strong conviction about this one single number. When I look at the yield on the 10-Year Treasury, it broke out […]   Read More
Date: April 10, 2024

Another Strong Employment Report Confounds The Bears

On Friday, the March jobs report showed 303,000 new jobs created which was well above expectations of 202,000 once again. The unemployment rate fell to 3.8% while wages increased 4.1% over the past 12 months. The Goldilocks economy with elevated inflation continues to defy the odds and critics. One by one almost every single tried and true predictor of recession has flashed since 2021 with varying lead times until the economy shrinks. But someone forgot to tell the economy to […]   Read More
Date: April 8, 2024

Who Turned The Lights Out?

Greetings from the Valley of the Sun where my daughter and I are hoping the UCONN men can win their second straight national championship. My body got a shock as the temp at the hotel was 90 at the same time as another major winter storm hit Vermont with another 18 inches of snow. Catching up with a childhood friend and her husband is one of the unintended benefits. As I flew to Phoenix I watched as early morning strength […]   Read More
Date: April 5, 2024

Two-Day Decline – No One Cares

Two down days in the stock market, but it certainly didn’t feel like folks cared much as stocks closed near their high for the day on Tuesday. And the down days were barely noticeable on a chart. Here are the charts of the S&P 500 and NASDAQ 100. As you know I have been looking for a Q1 peak followed by a less than 10% decline that wraps up by Memorial Day. We will see if that March peak holds […]   Read More
Date: April 3, 2024

New Week, Month and Quarter Begin – Back to Narrowness

As expected, Thursday was a very quiet day in the markets ahead of the long holiday weekend as well as closing out March and Q1. The government released its monthly Personal Consumption Expenditures (PCE) report which is a favorite of the Fed and it showed inflation came in as expected, up 0.3% for the month and 2% for the trailing 12 months. Early last week, I discussed how the week had a strong seasonal tendency to the upside. The S&P […]   Read More
Date: April 1, 2024

The Masses Said Small Caps Were Death & Going To Spiral Lower

Today is the last day of the week, month and quarter as markets are closed in observance of Good Friday. March and Q1 definitely flew by! As a reminder I will be conducting my quarterly webinar on Wednesday at 7:30pm where I review the events of Q1, discuss our strategies and their performance as well as take a sneak peak into what is ahead in Q2. Markets remain very quiet with low volatility. I don’t know why they do this, […]   Read More
Date: March 28, 2024