Is there a nascent rotation occurring? Everything but growth [aka NASDAQ 100] has outperformed the market the last several days. Yesterday the long-term trend returned as mega tech rose..aka NVDA up about 8% sending the NASDAQ up 1.2% and the rest of the market was flat. It is widely accepted that the markets are grossly … Read more
Bloomberg writes the NASDAQ 100 is “screamingly overvalued with its premium over fair value in excess of 50%” when the technology basket is viewed as a long duration bond. The analysis assumes that dividends that accrue from the NASDAQ 100 will increase at a compounded annual rate of 11%.The brick and mortar S & P … Read more
Will the deficit and the national debt become a campaign issue? Neither candidate has addressed the issue even though it is likely it could become something of significance in the intermediate future. It should be noted that a dated Gallup Poll (April) indicated that 40% of people aged 18-35 believe that fiscal issues are the … Read more
Markets became quiet Tuesday afternoon ahead of a rare mid-week holiday. Treasuries held their gains following a lackluster retail sales report. The data underscored a notable downward shift in consumer spending after stronger than expected readings earlier in the year. On the other hand, industrial production increased in May at a pace greater than expected. … Read more
All markets were relatively quiet yesterday. Equites led by the mega caps traded higher while Treasuries declined nominally in price, perhaps the result of a deluge of offerings.The narrative is rising about the single sidedness of the market. According to Bloomberg, there have only been six occasions in 20 years on which a single sector … Read more
Most were taught that money will ultimately gravitate to the sector or companies that present the greatest value with the least amount of risk. Considerable attention has been focused on the massive concentration of wealth in five or ten companies. Five names comprise a record of over 28% of the S & P and ten … Read more
Was yesterday a day of significance? The CPI was nominally lower than expected. The core rate climbed by 0.2% from April and 3.4% year over year, the slowest pace in more than three years. Analysts had expected a 0.3% and 3.5% pace, respectively. The headline rate was also lower than expected by 0.1%, posting a … Read more
Will today be of significance? As noted yesterday options have priced in a move of 1.3% to 1.4% if the CPI data is considerable different than the expected view. However, will this potential move be unwound by the outcome of the FOMC meeting? What are the odds that both events will not be an issue?Most … Read more
Yesterday was a quiet day heading into the two-day FOMC meeting and key inflation data. The narrative is rising about the concentration of the market. A Bloomberg headline read “Great Bear Market in Diversification Haunts Wall Street Pros.” The Newswire quoted Morningstar data that out of roughly 370 asset allocation funds tracked by Morningstar, just … Read more
The Treasury market got hit hard following a blockbuster May jobs report that lowered expectations for Federal Reserve rate cuts. The 10-year Treasury yield climbed about 13 bps to around a 4.4% yield and swaps no longer price an interest rate cut before December. As recently as Thursday two money center banks were predicting an … Read more
