Analysis Topic: Stock & Financial Markets
The analysis published under this topic are as follows.
Sunday, October 10, 2021
China / US Stock Markets Divergence / Stock-Markets / Stock Market 2021
By: Nadeem_Walayat
After having tracked each another quite closely since the pandemic low, Chinese stocks started to diverge during March 2021. The mania infected investors in US markets look to strong US GDP growth of +6.3% and strong earnings growth of 49% as reasons to ignore the lofty price earnings multiples, crazy valuations for trillion dollar corporations and even more for the mid cap tech stocks that are the darlings of the likes of ARK Invest, trading on bubble valuations that are literally straight out of the dot com bubble era where just as was the case then many don't even make a profit and a large percentage of which never will!
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Friday, October 08, 2021
Stock Market FOMO Going into Crash Season / Stock-Markets / Stock Market 2021
By: Nadeem_Walayat
Dear Reader
The stock market is continuing to rally on FOMO fumes with the Dow up 1.5% for August as the market enters the seasonally worst month of the year for stocks, followed by October, and we all know what October's tend to herald, especially for markets that have run well beyond every expectation and value metric that one can think of which is true for a wide spectrum of stocks from our AI tech giants right through to the junk that populates the likes of Cathy Woods ARK Funds, metrics as I covered in recent analysis such as the Reverse REPO market RED FLAG, then we have margin debt soaring to well beyond all previous market highs which actually would be expected in nominal terms given inflation, however Margin debt has also soared to new highs as a percentage of GDP 3.9% vs 3% in 2000. Here's another flashing RED LIGHT that of the market cap of negative earning stocks exceeding that of the dot com bubble, so folks enjoy your FOMO whilst it lasts, I personally have battened down the hatches for the hurricane that's coming our way that will likely blow novice investors out of the water, especially those who are investing on margin!
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Tuesday, October 05, 2021
Stock Market Correction: One More Spark to Light the Fire? / Stock-Markets / Stock Market 2021
By: P_Radomski_CFA
With earnings season beginning in October, a profound correction of the S&P 500 could add fuel to the fire of the already well-supported U.S. dollar.
While the USD Index was largely flat on Sep. 30, the EUR/USD closed at a new 2021 low. And because the currency pair accounts for nearly 58% of the movement of the USD Index, its performance is material. Moreover, while I’ve been warning for months that the Fed and the ECB are worlds apart, the EUR/USD still hasn’t priced in the magnitude of the divergence.
Monday, October 04, 2021
NASDAQ Stock Market Head-n-Shoulders Warns Of Market Weakness – Critical Topping Pattern / Stock-Markets / Tech Stocks
By: Chris_Vermeulen
The unique technical setup in the NASDAQ over the past 30+ days is warning that the markets have lost momentum and may attempt to break below the $14,700, the Neck Line of the Head-n-Shoulders pattern. This unique price setup crept up over the past 20+ days as the US markets started to move away from upward price momentum as the Chinese and US market dynamics started to shift away from the continued reflation trade expectations. What does this Head-n-Shoulders pattern mean for traders and investors right now?
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Friday, October 01, 2021
The Guide to Building a Design Portfolio Online / Stock-Markets / Investing 2021
By: Sumeet_Manhas
Building a design portfolio is much like the chicken-and-egg scenario: You need one to secure a job, yet without some professional experience to bolster your portfolio, you may struggle to find projects to display. It is not uncommon to feel stuck, regardless of whether you are a graduate, in a school, or in a position where you want to be hired. You can nonetheless find unusual ways to make work that is worth displaying when you break away from a customary attitude about how to create a portfolio. This article includes a few essential tips on how you can start with a portfolio website.
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Thursday, September 30, 2021
Stock Market Gauntlet to the Fed / Stock-Markets / Financial Markets 2021
By: Monica_Kingsley
S&P 500 was unable to sustain intraday gains, and both VIX and volume show the bears want to move. Arguably, the key market to watch, are the Treasuries – the 10-year yield continues rising, knocking on the 1.50% door again. On the day of Powell‘s testimony, that‘s quite a message to the central bank.
As I wrote yesterday:
(…) Rising yields (the market believes in taper, it appears) across the board, with high yield corporate bonds holding up much better than quality debt instruments – I have seen stronger risk-on constellations really.
Importantly, the huge weekly jump in Treasury yields (the 10-year yield jumped over 20 basis points to 1.47%) failed to lift the dollar, which says a lot given the risk-off entry to the week. Meanwhile, the Fed jawboning continues, and the bigger picture leaves the ambitious Nov tapering suspect.
At the same time, the Fed‘s foot is to a large degree off the gas pedal, and even global liquidity is shrinking. New taxes are kicking in, job market woes are persisting, inflation isn‘t going away any time soon, challenged supply chains are forcing globalization into reverse, workforce is shrinking, GDP growth is decelerating, and no fresh fiscal initiatives are on the horizon – sounds like a recipe for stagflation.
The Fed can adjust (and even reverse) the tapering projections any time it pleases – it has played the job market card already. The dollar failing to gain traction though, is telling. Not even commodities as such are rolling over to the downside – actually, energies (oil, natural gas) have been the star performers (even within the S&P 500 sectors), and agrifoods are well positioned to do great as well. Copper and precious metals are feeling the short-term heat (still, the red metal offered a great entry point earlier today, making the open position profitable from the get-go), but the metals would stop reacting to the bad news while ignoring negative real rates (yes, transitory inflation is another myth the market place believes in) at some point. All roads lead to gold – inflationary and deflationary ones alike.
Wednesday, September 29, 2021
Stock Market Wishing Away Inflation / Stock-Markets / Financial Markets 2021
By: Monica_Kingsley
S&P 500 bears did indeed move, and the dip wasn‘t much bought. VIX with its prominent upper knot may not have said the last word yet, but a brief consolidation of the key volatility metrics is favored next. Even the overnight rebound (dead cat bounce, better said), is losing traction, prompting me to issue a stock market update to subscribers hours ago – fresh short profits can keep growing:
(…) Following yesterday’s slide, the S&P 500 upswing appears running into headwinds as credit markets keep putting pressure on the Fed. Rising dollar is thus far having little effect on commodities, and precious metals have retraced a sizable part of the intraday downswing. Tech remains more vulnerable than value, and this correction appears as not (at all) yet over.
While the dollar upswing hasn‘t been strongest over the prior week, higher yields are causing it to rise somewhat still. The commodity complex is remarkably resilient – the open long positions are likely to keep doing well – and I don‘t mean only energies. Copper is holding up in the mid 4.20s while precious metals are giving the bears a break – a tentative one, but nonetheless encouraging – as I have written yesterday:
(…) the metals would stop reacting to the bad news while ignoring negative real rates (yes, transitory inflation is another myth the market place believes in) at some point. All roads lead to gold – inflationary and deflationary ones alike.
Tuesday, September 28, 2021
Reflation vs. Economic Stagflation / Stock-Markets / Financial Markets 2021
By: Monica_Kingsley
S&P 500 didn‘t give in to the opening weakness, and eked out minor gains. There was no selling into the close either – the table looks set for the muddle through to continue on Monday. Tech and value – uninspiring on the day, and the same could be said of the credit markets. Rising yields (the market believes in taper, it appears) across the board, with high yield corporate bonds holding up much better than quality debt instruments – I have seen stronger risk-on constellations really.
Importantly, the huge weekly jump in Treasury yields (the 10-year yield jumped over 20 basis points to 1.47%) failed to lift the dollar, which says a lot given the risk-off entry to the week. Meanwhile, the Fed jawboning continues, and the bigger picture leaves the ambitious Nov tapering suspect.
At the same time, the Fed‘s foot is to a large degree off the gas pedal, and even global liquidity is shrinking. New taxes are kicking in, job market woes are persisting, inflation isn‘t going away any time soon, challenged supply chains are forcing globalization into reverse, workforce is shrinking, GDP growth is decelerating, and no fresh fiscal initiatives are on the horizon – sounds like a recipe for stagflation.
Monday, September 27, 2021
China, India: Richer or Poorer? The Asian Pacific Financial Markets Forecast / Stock-Markets / Asian Economies
By: EWI
Dear Reader,
Today, both China and India are very different countries than 10 years ago. In so many ways, they are wealthier, safer and better.
But will these trends continue?
Our friends at Elliott Wave International are inviting you to get well-researched answers when you read this free excerpt ($59 value) from their September Asian-Pacific Financial Forecast.
See where China and India are in their Elliott wave patterns – and what that means for business and life in general.
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Monday, September 27, 2021
Stock Market Bubble Valuations Dot Com 2000 vs 2021 / Stock-Markets / Stock Market 2021
By: Nadeem_Walayat
The US stock market has been content to rally to new highs with many stocks going to the Moon including most of our AI tech giants, a rally that I have been distributing into to the extent that I have now sold 80% of my holdings in the Top 6 AI stocks in my portfolio some of which I have been accumulating for over a decade (Microsoft). The primary objective of this analysis is the determine where we stand in terms of THE TOP, after all, all bull markets eventually do top either ending with a CRASH (1987) or a bear market (2000 and 2007). So what to hold and what to sell is the question I am asking myself, with a view to riding out a potential bear market / crash, where this analysis deploys a new automated metric of individual stock SELLING LEVELs so that one better knows where one stands in terms of ones portfolio, all in just one table. After all the risk we all fear is that of a 2000 style collapse that sends stocks lower for the next 20 years! Remember that bear market bottomed with a 85% collapse for tech stocks! Yes, one could say the likes of Amazon, Microsoft, Apple had become dirt cheap, but that would have been a very painful and prolonged discounting event. So a case of balancing the risks of letting some stocks ride whilst cashing in those that will pay a heavy price for their over exuberance all whilst being aware of the AI mega-trend trundling along in the background.
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Monday, September 27, 2021
Stock Market Retest of the High? / Stock-Markets / Stock Market 2021
By: Andre_Gratian
Current Position of the Market
SPX Long-term trend: There is some evidence that we are still in the bull market which started in 2009 and which could continue until major cycles take over, and it ends. The 4550 projection which had been in effect since the March 2020 low has now been reached, but there is still no sign of a major top.
SPX Intermediate trend: A retest of the high is underway.
Analysis of the short-term trend is done daily with the help of hourly charts. They are important adjuncts to the analysis of daily and weekly charts which determine longer market trends.
Saturday, September 25, 2021
Tech Stocks Bubble Valuations 2000 vs 2021 / Stock-Markets / Tech Stocks
By: Nadeem_Walayat
The US stock market has been content to rally to new highs with many stocks going to the Moon including most of our AI tech giants, a rally that I have been distributing into to the extent that I have now sold 80% of my holdings in the Top 6 AI stocks in my portfolio some of which I have been accumulating for over a decade (Microsoft). The primary objective of this analysis is the determine where we stand in terms of THE TOP, after all, all bull markets eventually do top either ending with a CRASH (1987) or a bear market (2000 and 2007). So what to hold and what to sell is the question I am asking myself, with a view to riding out a potential bear market / crash, where this analysis deploys a new automated metric of individual stock SELLING LEVELs so that one better knows where one stands in terms of ones portfolio, all in just one table. After all the risk we all fear is that of a 2000 style collapse that sends stocks lower for the next 20 years! Remember that bear market bottomed with a 85% collapse for tech stocks! Yes, one could say the likes of Amazon, Microsoft, Apple had become dirt cheap, but that would have been a very painful and prolonged discounting event. So a case of balancing the risks of letting some stocks ride whilst cashing in those that will pay a heavy price for their over exuberance all whilst being aware of the AI mega-trend trundling along in the background.
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Saturday, September 25, 2021
Markets Deflationary Winds Howling / Stock-Markets / Financial Markets 2021
By: Monica_Kingsley
Without looking back, S&P 500 rallied in what feels as a short squeeze in ongoing risk-off environment. Daily rise in yields was not only unable to propel the dollar, but resulted in a much higher upswing in tech than value stocks – and that‘s a little fishy, especially when the long upper knot in VTV is considered.
The post-Fed relief simply took the bears for a little ride, and the Evergrande yuan bond repayment calmed the nerves. As if though the real estate sector was universally healthy – I think copper prices and the BHP stock price tell a different story. Things will still get interested in spite of PBOC moving in. The current macroeconomic environment will be very hard (economically and politically) to tighten into – have you noticed that the Turkish central bank unexpectedly cut rates?
Friday, September 24, 2021
Stock Market Rescued by the Fed Again? / Stock-Markets / Stock Market 2021
By: Monica_Kingsley
S&P 500 recovered only to dive again – carving out a base? The bulls are attempting to, but neither value, nor tech, nor the credit markets are convincing. The dust is settling though, and the bears are equally in need of a fresh reason to sell – the intraday tug of war is entirely reasonable as Evergrande failed to spook the markets more. Just wait for what happens when the markets come face to face with another unacknowledged event of this magnitude. In our era, it‘s about the contagion effect, manic-depressive market psychology, and uncertainty of the impact.
It‘s not only about China real estate cooling down, spilling over to Hong Kong. Wtll the House approval on the bill to suspend fresh borrowing obstacles and avoid a partial shutdown do? What would the Senate say – and then everyone as the tax tsunami keeps approaching? Global liquidity isn‘t rising after all either.
Fed taper is a side show, but still one that too many are glued to. The dollar would suffer if it doesn‘t materialize later today – and it won‘t be announced, which would make precious metals rejoice.
Back to stocks, these are also likely to welcome no taper. The Fed has been already tightening (which means these days it was decreasing the pace of expansion) through the back door, bringing down inflation expectations in spite of the real world input costs, shipping rates and frail supply chains challenges on top of the job market issues. Transitory inflation is still the mainstream thesis – the shift to real assets will become more accentuated once the realization of a higher and entrenched inflation arrives. And it‘s not about real estate and owners‘ equivalent rent either.
Friday, September 24, 2021
Evergrande not a Minsky Moment / Stock-Markets / Financial Crisis 2021
By: Richard_Mills
The selloff in stocks that started last week and continued on Monday has some market observers wondering whether this is a “Minsky Moment”.
This refers to the idea that periods of bullish speculation will eventually lead to a crisis, wherein a sudden decline in optimism causes a spectacular market crash.
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Thursday, September 23, 2021
Global Stock Markets Topped 60 Days Before the US Stocks Peaked / Stock-Markets / Stock Market 2021
By: Chris_Vermeulen
In the first part of this research article, I highlighted a number of factors and technical charts that suggest the true peak in the US/Global markets happened in April/May 2021. Although the US markets continued to trend higher after that peak, the global markets, as well as a number of key indicators, suggested the bullish price trend had reached a peak and started to weaken after the April/May 2021 peak.
My assumption is this data shows the markets entered a highly speculative phase of trading after the November 2020 elections. History shows us that the 12+ months prior to a US Presidential election are usually filled with uncertainty and sideways market volatility. Then, just after the US Presidential election is completed, the markets usually enter into a trending phase related to the expectations and promises of the newly elected US President. 2020 was no different in this process. What was different was the fact that the US Federal Reserve was still pouring trillions into supporting the post-COVID global economic recovery. So this post US Presidential election rally may have become a super-charged speculative rally phase with the US Fed backing the trends.
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Wednesday, September 22, 2021
Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment / Stock-Markets / Stock Market 2021
By: Nadeem_Walayat
Dear Reader
My last analysis posted on the 1st of September proved to be a timely reminder that an historically overbought stock market on virtually every measure was entering into the seasonally worst trading month of the year that at the very least suggests to prepare for a significant correction with each passing day and there was even a possibility of market panic event, a CRASH for which there are countless indicators that I have been covering since Mid June such as what is taking place in the Reverse Repo market of a defacto brewing Financial Crisis 2.0, the magnitude of which we will only realise with the benefit of hindsight, hence why I sold out of 80% of my Top AI stocks during the summer months with the last being to exit IBM leaving my AI stocks portfolio in it's current state, devoid for the first time in many years of the likes of Microsoft Apple, Nvidia and Amazon, with holdings of Google and Facebook greatly reduced.
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Wednesday, September 22, 2021
Stock Market Time to Buy the Dip? / Stock-Markets / Stock Market 2021
By: Monica_Kingsley
S&P 500 dived, yet the slide was bought before the closing bell. Does the long lower knot mean the selling is over? It‘s too early to say as following similar momentuous days, it takes 1-3 days for the dust to clear usually. The selling pressure might not be over, and the question is how far will it reach on a fresh attempt – 4,350s look attainable.
There, the fate of this correction would be decided, but we‘re on the verge of the historically more volatile part of Sep, and tomorrow‘s FOMC would up the ante. The dollar though was unable to rally, to keep intraday gains – on one hand a certain show of strength given the retreat in Treasury yields, on the other hand, proof of stiff headwinds as the world reserve currency isn‘t in a bull market. I‘m leaning towards the latter explanation.
As stocks rebound in what may still turn out to be a dead cat bounce, commodities got clobbered too – just as cryptos did. Gold attracted safe haven demand as money flew to Treasuries as well. Miners with silver holding ground, are a good sign for the sector – the overwhelmingly negative sentiment looks getting long in the tooth.
Tuesday, September 21, 2021
Evergrande China's Lehman's Moment, Tip of the Ice Berg in Financial Crisis 2.0 / Stock-Markets / Financial Crisis 2021
By: Nadeem_Walayat
Financial Crisis 2.0 continues to unfold where China's giant property developer Evergrande is the canary in the coal mine, tip of the ice-berg, China's Lehman's moment that looks set to default on $300 billion of debts. Here's what the giant property developers stock price looks like.
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Tuesday, September 21, 2021
The Fed Is Playing The Biggest Game Of Chicken In History / Stock-Markets / Financial Markets 2021
By: Avi_Gilburt
Yeah, I know everyone is so certain that inflation is what we will be battling for the foreseeable future. The main reason why many of you are so certain we are battling inflation is because you are seeing prices rise on food and other items for which you shop. But, do rising prices really mean we are dealing with the true economic definition of inflation?
To be honest, I really don’t care what you call it. It makes no difference to me since our analysis tells me when to get in and out of the market. You see, I and many others correctly recognize that the stock market leads the economy. So economic definitions have no bearing upon our forward-looking expectations regarding the stock market. And, I have explained why this is the case in past articles:
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