All major U.S. indices closed essentially unchanged last week except for the small-cap Russell 2000. While this index has been a weak spot in 2015, it gained 2.3% last week and is now challenging major overhead resistance.  I’ll take a more in-depth look at this index and its potential implications for the broader market later in this report. But the highlight heading into this week was investor indecision — the kind that leads into new intermediate-term price trends. #-ad_banner-# The benchmark S&P 500 began the week at precisely the same level it closed at on Oct. 28 —… Read More

All major U.S. indices closed essentially unchanged last week except for the small-cap Russell 2000. While this index has been a weak spot in 2015, it gained 2.3% last week and is now challenging major overhead resistance.  I’ll take a more in-depth look at this index and its potential implications for the broader market later in this report. But the highlight heading into this week was investor indecision — the kind that leads into new intermediate-term price trends. #-ad_banner-# The benchmark S&P 500 began the week at precisely the same level it closed at on Oct. 28 — 2,090. I continue to view this general area as a major decision point. The market must either break major overhead resistance levels that are currently being tested — and soon — or run the risk of another pullback that could retest the September/October lows. The best-performing sectors of the lackluster week were consumer staples, up 1.8%, and real estate, up 1.5%, the latter of which has benefited from the recent slump in long-term U.S. interest rates. Bringing up the rear was defensive utilities, which lost 1.5%. Small Caps At Major Crossroads Weakness in market-leading small caps has kept a… Read More

All major U.S. indices closed significantly higher last week. With one exception, the market has advanced every week since October.  The good news is that the rally was led by the tech-heavy Nasdaq 100, which gained 4.1%. The bad news is that the small-cap Russell 2000 once again… Read More

I’d like to share with you a list that was shown to me by our colleagues over at Profitable Trading.  It’s a list of 15 of the most widely owned stocks in the market. I’m sure you’ve heard of some of these companies, and it’s very possible you even own a few. #-ad_banner-#Yet Tom Vician, Certified Market Technician and Chief Investment Strategist of Alpha Trader, says that despite being featured prominently in the media and being held by some of the world’s top investment gurus, he wouldn’t touch any of them with a 10-foot pole. For example, one of these… Read More

I’d like to share with you a list that was shown to me by our colleagues over at Profitable Trading.  It’s a list of 15 of the most widely owned stocks in the market. I’m sure you’ve heard of some of these companies, and it’s very possible you even own a few. #-ad_banner-#Yet Tom Vician, Certified Market Technician and Chief Investment Strategist of Alpha Trader, says that despite being featured prominently in the media and being held by some of the world’s top investment gurus, he wouldn’t touch any of them with a 10-foot pole. For example, one of these stocks is a casino and resort operator. Hedge fund titan Mason Hawkins owns 12.1 million shares, yet it has collapsed 40% over the past six months. Another is a popular retailer that’s down 41% in the past six months. And Tom says it has basically been “dead in the water” for the past two years. But that’s not even the half of it. Tom says, based on their Alpha Scores, these stocks are likely to lag the market — or worse — over the coming weeks and months.  Simply put, they’re not stocks you’d want to have your money in… Read More

All major U.S. indices closed lower last week, breaking six straight weeks of gains from the late-September lows. The tech-heavy Nasdaq 100 and small-cap Russell 2000 led the way down, both posting 4.4% declines. As has been the case for most of this unusual year, investors have been optimistic enough buy virtually every minor pullback since January. At the same time, they’ve lacked the conviction to push the major indices to new highs. I’ll discuss this phenomenon in more detail in a moment and share a key to getting an early read on the market’s next move. Last… Read More

All major U.S. indices closed lower last week, breaking six straight weeks of gains from the late-September lows. The tech-heavy Nasdaq 100 and small-cap Russell 2000 led the way down, both posting 4.4% declines. As has been the case for most of this unusual year, investors have been optimistic enough buy virtually every minor pullback since January. At the same time, they’ve lacked the conviction to push the major indices to new highs. I’ll discuss this phenomenon in more detail in a moment and share a key to getting an early read on the market’s next move. Last week’s market collapse was led by the economically sensitive energy sector, which lost 5.5%. Recent weakness in crude oil and industrial metals like copper, which I’ll cover this week, has revived fears of global deflation. That fear is at least part of the reason the stock market took it on the chin last week. #-ad_banner-# A Tale Of Two Levels In last week’s Market Outlook, I pointed out that the market-leading Nasdaq Composite was testing its tech-bubble high at 5,133 for the fifth time this year. As I’ve been saying, if the index can stay above this level,… Read More

Will they or won’t they raise interest rates? It’s the question at the forefront of investors’ minds going into the next Federal Open Market Committee meeting. The board has considered hiking the federal funds rate for the past year, but hasn’t yet made a move. Many believe that the upcoming December meeting could be the one where we finally see a bump… I’m not here to predict whether or not the Fed will raise rates in December. I don’t know what their plan is… I’m not sure they do either. I do, however, want to give… Read More

Will they or won’t they raise interest rates? It’s the question at the forefront of investors’ minds going into the next Federal Open Market Committee meeting. The board has considered hiking the federal funds rate for the past year, but hasn’t yet made a move. Many believe that the upcoming December meeting could be the one where we finally see a bump… I’m not here to predict whether or not the Fed will raise rates in December. I don’t know what their plan is… I’m not sure they do either. I do, however, want to give you an idea of what may happen if the rates do rise.  It’s important to know what sectors could benefit from a possible rate hike — and which ones will suffer — if you want your portfolio to end the year in the black, and not in the red. Thanks to the folks at Bloomberg, I can run different economic scenarios and see the effects on a variety of financial instruments. So I looked at how a 25 basis point increase would impact the S&P 500. I was astonished to find that one of the best performing sectors is currently… Read More

All major U.S. indices closed higher again last week, logging the sixth straight week of overall strength. The rally was led by the beleaguered small-cap Russell 2000, which gained 3.3%.  This is a good overall sign because small-cap and technology stocks typically lead the broader market higher and lower. However, the Russell 2000 still has more work to do. It is the only major index still in negative territory for 2015. The two strongest sectors last week were financial services, up 3.7%, and financials, up 2.7%. The weakest sector was utilities, which lost 3.4%. #-ad_banner-# These sector-related gains… Read More

All major U.S. indices closed higher again last week, logging the sixth straight week of overall strength. The rally was led by the beleaguered small-cap Russell 2000, which gained 3.3%.  This is a good overall sign because small-cap and technology stocks typically lead the broader market higher and lower. However, the Russell 2000 still has more work to do. It is the only major index still in negative territory for 2015. The two strongest sectors last week were financial services, up 3.7%, and financials, up 2.7%. The weakest sector was utilities, which lost 3.4%. #-ad_banner-# These sector-related gains and losses were a direct result of last week’s big jump in long-term U.S. interest rates. The yield on the benchmark 10-year Treasury note rose by 18 basis points to finish the week at 2.34%. Rising long-term interest rates benefit lending institutions while attracting yield-seeking investor assets away from riskier utilities.   I’ll talk in more detail about the direction of long-term interest rates and the effect they could have on financial asset prices later in this report. Tech Stocks Front And Center Again This Week Three weeks ago, I pointed out a bullish chart pattern in the S&P 500… Read More

The market is about to get crazy. Over the next month, stocks both large and small are going to be volatile. They’ll bounce around 10%, 20%, even 35% or more in a single day. This “volatility season” was built into the financial system over 80 years ago by the U.S Securities and Exchange Commission (SEC), and there’s nothing you can do about it. It’s inevitable. It’s more commonly known as earnings season. Earnings are the true drivers of stocks, and I have good reason to believe a lot of companies are going to report lackluster results. For the next few… Read More

The market is about to get crazy. Over the next month, stocks both large and small are going to be volatile. They’ll bounce around 10%, 20%, even 35% or more in a single day. This “volatility season” was built into the financial system over 80 years ago by the U.S Securities and Exchange Commission (SEC), and there’s nothing you can do about it. It’s inevitable. It’s more commonly known as earnings season. Earnings are the true drivers of stocks, and I have good reason to believe a lot of companies are going to report lackluster results. For the next few weeks, we’re likely to see one-day stock moves of 5% to 15%-plus more frequently. This can result in quick losses or gains — depending on how you’re positioned. If you could accurately predict whether a company will beat or miss earnings estimates before its quarterly report, then you could profit from the post-report move. Over the years, I’ve developed a proprietary earnings algorithm that helps me do just that. With it, I have been able to predict — with good odds — whether a company’s earnings will beat or miss the consensus. For instance, in mid-October, my earnings algorithm predicted… Read More

With the elections around the corner, it only makes sense to bring up the enormous elephant in the room: politicians are rich… and intend to stay that way. Ben Carson left his campaign last month to spend time on a book tour. Trump came out with his own book recently. Of course, none of that’s new. Newt Gingrich did the same last election cycle.  And we know that the Clintons both made the vast majority of their wealth through book sales and speeches. The Obamas too. What might not be so apparent — but surely not shocking all the same… Read More

With the elections around the corner, it only makes sense to bring up the enormous elephant in the room: politicians are rich… and intend to stay that way. Ben Carson left his campaign last month to spend time on a book tour. Trump came out with his own book recently. Of course, none of that’s new. Newt Gingrich did the same last election cycle.  And we know that the Clintons both made the vast majority of their wealth through book sales and speeches. The Obamas too. What might not be so apparent — but surely not shocking all the same — is that the vast majority of politicians are also successful investors. According to the Office of Public Records of the Secretary of the Senate, 50% of federally-elected politicians are millionaires. Much of that was due to “successful investments and portfolio management.” I say that so tongue-in-cheek because of this other simple fact from the same watchdog group: members of the House of Representatives outperform regular investors by 6.8 percentage points. Think about what that means. In years when you make 10%, they make 16.8%. When you lose 5%, they still make 1.8%. You can’t tell me that they are… Read More

All major U.S. indices closed higher last week except the small-cap Russell 2000, which lost just 0.4%. This was the market’s fifth week of overall strength, and the modest advance nudged the S&P 500 back into positive territory for the year.  The tech-heavy Nasdaq 100 remains in the lead this year, up 9.7% through the end of October. Technology stocks, specifically the Nasdaq 100 and Composite indices, are critical to overall market performance this month. We will be taking a closer look at both of these in a moment. Read More

All major U.S. indices closed higher last week except the small-cap Russell 2000, which lost just 0.4%. This was the market’s fifth week of overall strength, and the modest advance nudged the S&P 500 back into positive territory for the year.  The tech-heavy Nasdaq 100 remains in the lead this year, up 9.7% through the end of October. Technology stocks, specifically the Nasdaq 100 and Composite indices, are critical to overall market performance this month. We will be taking a closer look at both of these in a moment. #-ad_banner-# From a sector standpoint, last week’s advance was led by health care and consumer discretionary, which gained 3% and 1.7%, respectively. Asbury Research’s own ETF-based metric shows the biggest sector-related investor inflows during the past week went into health care, fueling strength in the sector.  The two weakest sectors last week were utilities and consumer staples, which lost 1.9% and 1.7%, respectively. Technology At Critical Decision Point In last week’s Market Outlook, I pointed out the Nasdaq 100’s move above its 4,451 Sept. 17 high on Oct. 22 suggested “the index’s… Read More

With Halloween coming up this weekend, what better time to reflect on the stock market’s recent ups and downs? After all, the market headlines have been a little scary lately. If you don’t like big changes, you may feel a little spooked this fall. Check out this chart of the VIX Index, the commonly accepted measure of S&P 500 volatility. After a long period of relative tranquility, volatility jumped in August and took a while to calm down. There are many reasons for the volatility. Leading the list are signs of weakness in the U.S. economy, concerns about… Read More

With Halloween coming up this weekend, what better time to reflect on the stock market’s recent ups and downs? After all, the market headlines have been a little scary lately. If you don’t like big changes, you may feel a little spooked this fall. Check out this chart of the VIX Index, the commonly accepted measure of S&P 500 volatility. After a long period of relative tranquility, volatility jumped in August and took a while to calm down. There are many reasons for the volatility. Leading the list are signs of weakness in the U.S. economy, concerns about slowing growth rates for China’s economy, uncertainty about the Fed’s intentions regarding short-term interest rates and worse-than-expected earnings from some prominent companies. Despite these negatives, stocks have overcome their August-September swoon with an impressive rebound in October, as investors snatched up high-quality stocks. I’ve advised keeping cash out of the S&P 500 during periods of high volatility. In addition, the overall market’s valuation remains a little high relative to earnings, and all of the concerns listed above remain valid. Don’t Let Fear Blind You To The Real Opportunities In The Stock Market Now, I don’t want you to worry. Read More