Asian manufacturing data spur stock tumble
It’s not just China anymore. Unfortunately. The Caixin Media and IHS Markit Purchasing Managers Index for China’s manufacturing sector fell to 49.7 in December  from 50.2, its lowest reading since May 2017. That confirms a trend seen in the official...
Why predicting a bottom for this bear is so hard: More lessons from the charts
Once stocks have wound up in the jaws of a bear market, the most pressing question is when/where will it end? Which is tough to predict because we have a relatively small data set to project from–we’ve only had 12 bear markets (using the 20% drop from a...
Markets blow a raspberry to Christmas–and Mnuchin
And Merry Christmas! to you too. The stock market delivered a lump of coal on Christmas Eve. (Does this mean the financial markets are part of the dastardly war on Christmas? Say it ain’t so, Goldman Sachs!) The Standard & Poor’s 500 index closed down...
Worst of both worlds from the Federal Reserve stokes continued selling
Yesterday, the Federal Reserve delivered the worst of both world’s, as far as Wall Street is concerned. And the 25 basis point increase in benchmark interest rates doesn’t even count–since that was what the market was expecting. First, the Fed drew...
Did Monday action signal a (temporary) bottom?
Monday’s big drop in U.S. stocks was unusual in this period of frequent market routs–and unusual in an important way. Even as the market has tumbled day after day, investors haven’t seen a big 90% down day of the kind that signals a (perhaps temporary) capitulation...
Xi’s tough talk isn’t good news for investors
Hope you weren’t hoping for good news from President Xi Jinping’s speech Tuesday to an audience of party officials, military honchos, and business leaders on the 40th anniversary of Deng Xiaoping’s Reform and Opening Up campaign that unleashed China’s economy. First,...
News flow a net negative this morning and stocks retreat
I recently noted that I thought stocks wanted to climb, and would through the end of the year–if news let them. Well, this morning, the news has put a big downward thumb on the scale. First off, November retail sales grew 8.1% year over year, China’s...
Nobody wants to get too far ahead of the news in this stock market
After yesterday’s bounce in riskier bounce-worthy stocks, today the U.S. market is seeing a slight pull back. At 1:30 p.m. New York time the Standard & Poor’s 500 is off 0.34% and the Dow Jones Industrial Average is lower by 0.05%. The NASDAQ...
U.S. stocks want to bounce, but not so sure about a rally
Bounce, yes. Rally, maybe. What the difference? Conviction and duration. The wider market isn’t sure that the bad news on the U.S. China trade war is over and doesn’t want to get blind-sided. That’s why the broad indexes such as the Standard &...
Markets worry about everything this morning–especially bank and energy stocks
I dare you to find something global financial markets aren’t worried about. And, moreover, many of the worries are re-enforcing each other today. So, for example, we’ve got U.S. Trade Representative Robert E. Lighthizer, saying on Sunday TV the the 90 day...
Was the Fed telling the markets something today?
The Federal Reserve’s interest rate setting body, the Open Market Committee, meets on December 19 to 1) decide on a 25 basis point boost in benchmark interest rate, and 2) to tell financial markets what to expect on interest rate increases for 2019. It’s...
For the Fed, one and done–for a while?
This morning the November jobs report came in softer than expected–and that pretty much removed the last factor pushing the Federal Reserve toward aggressively raising interest rates in 2019. For November the economy added 155,000 jobs. That is still a strong...
OPEC cuts production by more than expected–but markets are increasingly less impressed as the day advances
To the surprise of many, OPEC & Friends–what’s known as OPEC+–agreed to cut production by 1.2 million barrels a day beginning in 2019. This was a bigger cut than the 1 million barrels a day that commodity markets had expected. Oil prices and oil...
Market looks like it’s trying to force another Federal Reserve bounce
On a day like today–when U.S. stocks have resumed their downward plunge–the Standard & Poor’s 500 was off 1.91% as of 1:30 p.m. New York time and the Dow Jones Industrial Average was lower by 2.08%–it’s important to remember that the...
China confirms some of Trump-Xi deal; global markets steady
It had seemed unlikely. China couldn’t officially confirm the details in the trade and tariffs deal struck between U.S. President Donald Trump and Chinese President Xi Jinping, Chinese officials said, until President Xi and the Chinese delegation returned from...
It’s important to remember on this down, down, down day that an earnings growth slump in 2019 and a 2019 recession aren’t the same thing
It’s hard to take a step back on a day when the Dow Jones Industrial average closed down more than 700 points (and 3.10%), but that’s exactly what I’m going to suggest. The huge sell off was driven by three major factors in my opinion. First, the...
Oil gains on Trump-Xi “success, Russia-Saudi “deal,” and actual production cuts from Alberta
As of 2:30 p.m. New York time U.S. benchmark West Texas Intermediate was up 3.04% to $52.48 a barrel. International benchmark Brent crude gained 2.84% to break back above $60 a barrel at $61.15. Part of the reason for the gain is a general sigh of relief that the...
OPEC advisory group recommends cut of 1.3 million barrels a day to December 6 oil cartel summit
It’s only an advisory group with no decision-making power, but the recommendation from the Organization of Petroleum Exporting Countries Economic Commission Board is the first step in changing production policy at OPEC & Friends. Today the group told OPEC...
China’s banking system springing leaks all over
Take your pick. Either story shows the deep stress in China’s banking system at a time when China’s economy is already slowing. Story 1: After trying to regulate the Peer to Peer lending industry, Beijing has decided to shut down most of the $176 billion...
Fed’s Powell speaks softly; stocks roar higher
Sometimes the market hears what it wants to hear and then storms higher (or lower) on what is little more than a hint. In the short run that doesn’t much matter since the oftentimes huge gains are real and investors can and do take them to the bank. In the...
One more for the list: ECB starts countdown to euro decision on December 13
On December 13 the European Central Bank will decide whether to cap its $2.9 trillion program of bond buying as planned. The bank had decided that Europe’s economy was strong enough for the central bank to wind down its purchases of bonds that have kept interest...
The market waits to hear what Trump and Xi will say over the weekend
Nothing will be as important this week to the financial markets as the meeting between U.S. President Donald Trump and Chinese President Xi Jinping during the November 30-December 1 summit of the Group of 20 in Buenos Aires. Ahead of the weekend meeting days when the...
What’s ahead for this market? Does it turn into a true bear?
If you own any of the big technology stocks that led the U.S. higher in the first eight months of 2018, the losses over the last six weeks sure make this feel like a bear market. Remember that the classical definition of a bear market is a drop from the high of 20% or...
Retail doesn’t ride to the rescue today–Target and Kohl’s send sector lower
The hope among some in the Wall Street crowd was that today’s earnings reports from retailers such as Target (TGT) and Kohl’s (KSS) –and especially guidance for the Christmas shopping quarter to come–would end the plunge in the U.S. stock...
If you’re worried about the Credit Crunch, then Ford debt nearing junk status is a bad sign
I’ve written more than once about my conviction–and consequent worry–that we’re headed for a global credit crunch sometime in the next three to four years. I’m looking for the kind of Minsky Moment that sees financial markets go into...
Another sign of coming inflation to worry the Federal Reserve
The 3.1% year over year growth in average hourly wages reported for October is, by itself, enough to convince the Federal Reserve that an increase in inflation, long awaited with concern, is visible on the horizon. Today’s jump in the Producer Price Index (PPI)...
Return of buybacks enough to put floor under U.S. stocks
Part–but certainly only part–of the weakness in U.S. stock prices in October came from the blackout period on companies buying back their own shares. Many companies have self-declared buyback blackout periods running from a couple of weeks before the...
News reports on U.S.-China trade talks play bigger in Asia than in U.S.
News reports that President Donald Trump has ordered staff to prepared a potential trade offer ahead of his talks with China’s president Xi Jinping on November 30-December 1 sent Asia markets and currencies soaring in the overnight session. U.S. stocks and bonds...
Optimism on China trade talks drives U.S. stocks higher
This morning at least a tweet from President Donald Trump is the most important factor moving U.S. stocks higher. In his tweet President Trump said he had had a productive conversation with Chinese President Xi Jinping on trade. Â “Those discussions are moving...Jim’s Daily Email Alerts:
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