Who's right? Individuals bearish,hedge managers are bullish
Individual investors say stocks are going to fall. They’ve pulled $3.7 billion out of equity mutual funds since August, according to the Investment Company Institute. Hedge fund managers say they’re going up. They’ve got more money in stocks than at any time since the...Big caps start to beat small caps: What's that all about?
Now it’s the big caps leading the stock market. From the bottom on March 9, 2009 through October 14 small company stocks led the market. The Russell 2000 Index (IUX) of small cap stocks climbed 82%. The Dow Jones Industrial Average (INDU) of big company stocks hasn’t...How to escape the next lost decade
A lost decade. 1999 to 2009 sure qualifies for many investors in stocks. A lost decade to come? I can’t tell you what stocks or stock markets will perform best over the next ten years. But I can tell you that many U.S. investors are still sitting in portfolios that...More testing ahead for stocks
Not so long ago, November 18 to be precise, I wrote that the rally was still firmly in charge. Right now I’d take out that word “firmly.” I had thought that when the Standard & Poor’s 500 closed above 1110 on November 17 stocks were done consolidating and had...Nervous? Afraid to stay in but scared to get out? Join the club (and read my three strategies for coping)
Feeling twitchy? Your portfolio is probably full of stocks trading at 52-week highs. And I’ll bet you’ve thought about selling. And you would do that–except that the stock market keeps going up (well except for the last couple of days), cash pays close to...When bad news doesn't take stocks down, the rally is still in charge
Stocks are hanging tough in the face of some heavy duty bad news. For the last two days, November 17 and 18 the Standard & Poor’s 500 has refused to drop below 1100. That’s often a sign that stocks are ready to move higher when the bad news flow stops. How bad has...My guide to how to worry: Know what to worry about and when if you don't want to get spooked out of a rally–or get killed in a correction
(Originally posted on October 14 but several readers have asked me to repost.) What me worry? On a day when the Dow Jones Industrial Average closes above 10,000 for the first time in a year and when the Standard & Poor’s 500 stock index closes within kissing...You may not like the fundamentals but this rally is headed higher
The test is over. And the stock market rally has passed. On November 16, the Standard & Poor’s 500 and the NASDAQ 100 both joined the Dow Jones Industrials in setting new recovery highs. In other words all three indexes have busted out of the trading range of 1025...Have stocks moved from dip to consolidation already? And is the next move up?
With the Federal Reserve set to speak on the economy and interest rates later today, November 4, and with potentially market-moving numbers on unemployment due out on November 5 and 6, it is certainly too early to say that the dip, correction, whatever, is over. The...Watch out, higher volatility ahead. A jumpy market can cost you a chunk of cash even if the indexes don't plunge.
Hold onto your hats! I’m afraid that investors are in for a big step up in volatility. Take Friday’s 250-point drop in the Dow Jones Industrial Average. Scary? You bet. But I’d argue that it was just “normal” volatility these days. It wasn’t the result of...Three very cautious cheers for the GDP numbers
U.S. GDP grew by 3.5% in the third quarter of 2009. That was a bigger increase from the third quarter of 2008 than the 3.2% that the majority of economists had been expecting. This marks the first time that the economy has grown after four straight quarters of...So far–so far–this is a normal correction. Watch the GDP number on Thursday
I know this is painful. Stocks, mine in the JubakPicks.com portfolios and in my own portfolios, are down. And it’s starting to feel serious. Stocks have dropped for four trading sessions in a row and for six of the last seven. Since the decline began, small cap...Roubini, the bear who got it right, predicts another asset bubble bust
Bad times are coming, according to Nouriel Roubini, although they may be a year or two away. The New York University professor of economics is worth listening to since he called the U.S. housing bust and global financial crisis not only exactly right but in time to do...Why all the hub-bub, bub?
As of yesterday’s close, stocks were down on four of the last five days. The Dow Jones Industrial Average is criss-crossing the 10,000 mark like a drunk trying to walk a straight line for an impatient highway cop. The Standard and Poor’s 500 stock index is...This rally faces important short-term technical challenges
Last week put this rally at one of those short-term turning points. A number of markets are challenging critical ceilings or testing major support levels. That’s likely to keep investors nervous, and the markets jittery, until the trend resolves into continued...The weak dollar/strong stocks feedback loop is still alive and well
The U.S. dollar traded to another low and stocks rallied. What else is new? This feedback loop has been locked into place for months and it’s showing no signs of taking a vacation. Here’s how it works. A falling dollar leads to increases in the price of...Rallies after short-term dips making bears cautious
It’s drops like we had at the end of the day on Wednesday followed by rallies like we had on Thursday that are keeping bears from launching a major attack on this rally. Wednesday’s sell off at the end of the day looked like it might lead to a big enough...Companies beat Wall Street earnings estimates at a record pace so far this quarter
So far, so good on the earnings front this quarter. Third quarter earnings reports have beaten estimates at 79% of the 104 of the 500 companies in the Standard & Poor’s index that have reported so far. Positive surprises in the second quarter helped fuel a rally...Why this isn't the start of another 10-year bull market
Absolutely brilliant table on Briefing.com this morning explaining why the rally off the March 9, 2009 low is a great short-term bull market but why longer-term the bear remains in control. The jargon for those who care is that this is a cyclical bull inside a secular...Will IBM earnings be good enough to fuel the rally?
IBM (IBM) got almost everything right in its October 15 earnings announcement. And still the shares dropped almost 4% in after-hours trading. Sales fell 6.9% from the third quarter of 2008 to $23.6 billion. But that still beat Wall Street projections for sales of...Wall Street's numbers on earnings and revenue for 2010 don't add up
Good number crunching in the “Ahead of the Tape” column in yesterday’s Wall Street Journal by Mark Gongloff. Conclusion: It’s hard to see how U.S. companies are going to deliver the earnings growth Wall Street now projects for 2010. Here are...Earnings above low expectations? Probably. Revenue growth? Unlikely. Will that be enough for a rally?
Last June when this rally looked likely to falter, earnings bailed it out. Not that earnings were so great. They were just better than expected. Analysts had reduced their predictions by so much, in fact, that some companies turned in quarters that were 20, 30, or...Buyers are snapping up Treasuries–that's usually not a good sign for stocks
Low yields on U.S. Treasury bills, notes, and bonds are good for stocks. They make bonds look less attractive and stocks relatively more so. But falling yields that are caused by buyers flocking to Treasuries aren’t a good sign. The decline in yields then is a...Buy on the dip? Even a tiny 3.3% dip? Maybe soon for some of the stocks I've called "too expensive"
You can tell a lot about the short-term direction of the market from how it responds to news. A market that, in Wall Street parlance, wants to go up won’t pay any attention to bad news. It will rally anyway. A market full of investors looking for an excuse to take...In the very (very, very) short term the stock market has gone defensive
Yesterday on StockCharts.com Arthur Hill took a look at what sectors are showing relative strength. What he found was that over the very short term–that is from around September 15 or 22 (depending on the sector) defensive sectors such as utilities, health care...Ultimately, this stock market rally lives and dies on interest rates
So it’s a good thing when people such as Federal Reserve Vice Chairman Donald Kohn say that the Fed will keep interest rates near zero “for an extended period” as he did in a September 30 speech in Washington. As long as interest rates are so low, bond yields on...Those individual investors who left the stock market in 2008 aren't back yet–which will make any near-term dip short and shallow
The Standard & Poor’s 500 stock index is up close to 60% from the March 2009 bottom. Most investors, according to data on mutual fund money flows, have stayed the course so while they were pummeled by dropping prices in 2008, they’ve also profited from...Way down the road I can see early signs of the next stock market–and it's not going to look a lot like the last market or today's either
Sometimes the shortest distance to portfolio disaster is a straight line between two points. This, I believe, is one of those times. If I’ve been clear about nothing else in the last few weeks, I hope I’ve been clear on how impossible it is to find a reliable,...This is the point in a rally when some prices can give false clues
On Monday September 21 stock prices moved lower. The price of a barrel of oil tumbled too, breaking below $70. On Tuesday stocks rallied and the price of barrel of oil climbed back above $71. Upward momentum had been restored, right? Well, I wouldn’t bet on it....Jim’s Daily Email Alerts:
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