Equities led by companies that stand to benefit the most from an economic revival rebounded. Similar to the prior two days, there was no specific catalyst. Many times, I have commented Main Street may outperform Wall Street as the economy is expected to expand by the greatest rate since at least 1984. Yesterday Bloomberg offered … Read more
Was yesterday a day of significance? Oil advanced over 2% as several oil tankers were attacked in the Gulf of Oman. As widely noted, oil has plunged since sanctions were levied on Iran as inventories have surged. Many, including me, expected inventories to fall given these sanctions, the Venezuelan implosion, erratic shipments from both Nigeria … Read more
The four major possible trends that I have focused on during the past nine months may be coming to fruition. I will address the four in no particular order. First is oil. I have been an oil bull for four simplistic reasons. I have argued there will be a cut in production from non-OPEC nations. … Read more
Several years ago I attended a conference where several prominent hedge fund and private equity managers were speakers. Perhaps the consistent theme amongst the presenters was the best opportunities present themselves when “blood is running in the street.” Oil has been decimated. Crude was down 19% in July and another 4% yesterday. Data from the … Read more
For many July was an ugly month. Perhaps one of the few positives to write is the narrative is rising about the narrowness of the market where only 5 or 6 stocks have contributed to the year to date return for the averages. Over 60% of NYSE listed securities are now trading below their 200 … Read more
The Russell 2000 surged 1.8% yesterday on the strength of commodity companies, more specifically the energy issues that rose 6.1%. Unless one has been living in a cave, all commodity companies have been crushed, decimation that has not spared the debt. Bloomberg writes the Russell 2000 oil companies plunged 7.2% on Monday. Personally I have … Read more
Today third quarter GDP is revised. Consensus is now expecting third quarter growth to be 3.3% versus the previously reported 3.5% rate. Is this of any significance? I would argue no, as the vast majority of real time indicators are suggesting a further acceleration into the fourth quarter. Yes there may be some second and … Read more
In my view the headlines are ugly. Ebola. Ukraine. ISIS. Eurozone. Japan. China. Emerging markets. The question at hand is if the headlines are so ugly why the advance in the S & P 500 and Russell 2000? I must write other markets are not feeling the love. Commodities have been crushed. Non-investment grade bonds … Read more
Was yesterday’s print of third quarter GDP growth of 3.5% validated the Fed’s nominally hawkish tone? I think yes. As widely noted, consensus expected a 3.0% rate. Exports and government spending led by military spending—the biggest increase since 2Q09—were the major reasons for the surprise. Real final sales (GDP less inventories) of 4.2% climbed the … Read more
The FOMC statement is made at 2:00 P.M. To write the incredibly obvious, all will dissect every word in an attempt to gain insight into the Fed’s thinking, a thinking which in my view is all over the map. As noted several times, the members of the Committee have expressed various opinions about the strength … Read more
