Markets Continue to React Counterintuitively to Inflation
As you know my thinking regarding inflation has changed over the past few months following the reports released in May and June. Both of those showed white hot inflation with very counterintuitive market reaction. By that, I mean that the securities that should have fallen hard actually rallied and vice versa. After the April report was released in mid-May I thought it was just an anomaly, but back to back odd reactions had me rethinking my thesis. Take a look […]
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Date: August 13, 2021
***Q2 Client Update*** – Excerpts
Many people like to read my very brief quarterly client update which I select excerpts. If you’re one of them, please read on. If not, feel free to stop right now. Always happy to hear comments and questions. It seemed like yesterday when every piece of news was dark and uncertain. People were acutely concerned about their survival and less about their finances. 2020 was a year where time almost stood still. 2021 could not have been any more the […]
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Date: August 11, 2021
Warning Signs Abound
Stocks begin the new week with most of the same challenges as I have been discussing. The five major stock market indices are not all in syn as the S&P 400 and Russell 2000 remain well below their all-time highs. While semis and discretionary are at or near new highs, transports and banks are well below. The NYSE A/D Line is repairing itself, but it is still a strong few days from new highs. Whether we are looking at the […]
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Date: August 9, 2021
Some Canaries Are Struggling to Breathe
On Friday the government will release the July non farm payrolls report, better known as the monthly employment report. The payroll firm, ADP, released their monthly report on Wednesday and it showed a much weaker jobs market than most thought possible. Interestingly, neither the stock nor bond market reacted well. I put very little stock in the ADP report has its correlation to the real one is underwhelming. In other words it has some nice hits and some big strikeouts. […]
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Date: August 5, 2021
August Has Not Been Kind to the Bulls
Seriously, how can we be into August already? 2021 is flying by at warp speed and I am not liking it! It needs to slow down Kemosabe. I need some time to breathe, smell the flowers and catch up. I had an extra hour of time today as my wife and I drove home from Lyman Orchards after a quick peach and blueberry pick. Right after we passed the exit before ours, traffic ground to a standstill with four miles […]
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Date: August 2, 2021
Huge News Week But Not Much Movement & No Surgery
Lots of interesting news, but not much in the way of market action. Today is the last day of the month, but the stock market is looking weaker based on the ongoing China debacle and Amazon. I won’t look too deep into this as the week ends. I remain on guard for a summer peak in stock prices that leads to a 7-11% decline. Getting back to the news, on Thursday we had the much anticipated Robinhood IPO although I […]
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Date: July 30, 2021
Fed Day & Powell Laughing at Me – Sell The News on Earnings
Coming in to the week, there was so much to focus on, so much to worry about for the media. Delta variant, new mask rules, the Fed meeting and every mega cap tech stock reporting earnings. All I heard was about the massive fireworks that would be coming. Well folks, so far, there has been nothing. Even with Apple, Microsoft and Google reporting at the same time, there has barely been a sparkler. And all three companies had stellar quarters. […]
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Date: July 28, 2021
All-Time Highs But Some Cracks in the Pavement
The stock market begins the new week with the Dow Industrials, S&P 500 and NASDAQ 100 at all-time highs. That’s the good news. However, the S&P 400 and Russell 2000 (chart below) are lagging badly. That’s not so good. Additionally, the number of stocks participating in the rally is underwhelming, not to mention that sector leadership is less than inspiring. That’s worse. Below you can see one of my favorite canaries in the coal mine, the NYSE Advance/Decline Line which […]
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Date: July 26, 2021
I Could Be Wrong
On Monday there was a large point drop, but relatively small percentage drop in the stock market. I did not have strong conviction whether that was a few day wonder or the beginning of a mid-single digit pullback. And frankly, I still do not have strong conviction on this. While the bounce in price since Monday has been impressive, market participation has been underwhelming. As you know, I came into this week having raised a little cash and/or hedged a […]
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Date: July 23, 2021
Was That It? Pullback Over?
My, my, my, what a difference a day makes. The stock market went from the world ending to partying like it’s 1999 in the span of 18 hours. Oh how I enjoyed the pundits falling over themselves espousing their bearishness on Monday and turning tail on Tuesday. In my case, as you know, I wrote about playing some defense last week. And we did with some sales and hedging. After Monday’s rout I bought a small cap index, Cathie Woods’ […]
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Date: July 21, 2021
