July 20, 2021 | Daily JAM, Morning Briefing |
Today investors and traders ran to buy all the re-opening, post-vaccine recovery, cyclical stocks that they dumped yesterday. Macy’s (M) is up 4.29% as of 3:30 p.m. New York time after plunging 4.90% yesterday. Amusement park operator Cedar Fair (FUN) is up 4.12%. Cyclical Dupont (DD) is up 1.34% after closing down 4.46% yesterday. Carnival Cruise (CCL) is ahead 7.83% today after dropping 5.74% yesterday. It’s as if the market has decided that the really scary upward trend in new infections from the spread of the Delta variant is done with and over. Pandemic yesterday. No pandemic today.. The figures from the pandemic front say otherwise. The 14-day change in new cases as of July 19 is 198%. The 14-day change in new deaths is 44%.
July 19, 2021 | Daily JAM |
Today, Monday, July 19, stocks accelerated their retreat from the end of last week on fears that a fourth wave of the pandemic, fueled by the Delta variant, will crush hopes that the economy is headed back to normal. As of the close New York the Standard & Poor’s 500 was down 1.59% and the Dow Jones Industrial Average was lower by 2.09%. The NASDAQ Composite was off 1.06% and the NASDAQ 100 had dropped 0.90%. The small cap Russell 2000 had fallen 1.51% and the iShares MSCI Emerging Markets ETF (EEM) was down 1.68%. For the day at least you can see the market’s fears accurately reflected in the list of stocks falling most heavily.
July 11, 2021 | Daily JAM |
Investors and traders will be looking to the first batch of earnings from big banks on Tuesday and Wednesday to answer two big questions: 1. Will earnings show the huge 65% year over year growth now expected by Wall Street analysts? 2. Will investors and traders sell on the news or push stocks higher on hoped for more economic (and earnings growth) to come? But I think w’ll have to wait until the week of July 27 to get answers to those queries.
July 9, 2021 | Daily JAM, Morning Briefing |
Stocks rallied today and bond prices moved higher (sending bond yields lower) on news that China People’s Bank and the European Central Bank would both pursue monetary moves to bolster growth. The People’s bank reduced the amount of cash that banks have to hold in reserve by 0.5 percentage points. That will send about 1 trillion yuan ($154 billion) in liquidity into the economy. The reduction in the reserve ratio was larger than most economists had projected. China is set to announced second quarter GDP figures in the coming week and the strength and accelerated timing of the move fed speculation that the numbers will show weaker than expected economic growth. The European Central Bank shifted its inflation target to 2% rom the prior “below, but close to, 2%.” The move signaled that the ECB, like the U.S. Federal Reserve, would be willing to tolerate higher inflation in the short term rather than endanger economic growth by raising interest rates. The central banks move–plus a week of selling of cynical stocks, led to a solid rally today
July 3, 2021 | Daily JAM |
Friday’s market action argues that investors and traders are looking to buy shares of Apple, Amazon, Microsoft–you know the usual suspects–ahead of what looks like a blowout earnings season that will start on July 13 when JPMorgan Chase (JPM) reports before the market open.
June 18, 2021 | Daily JAM, Morning Briefing |
Yesterday, growth stocks climbed in the face of signals from the Federal Reserve on Wednesday that interest rates increase were coming sooner–as soon as the end of 2022–than expected. That seemed puzzling. May be, one line of thought (mine) had it, investors and traders decided that growth stocks would outrun any increase in interest rates that might take place in 2022 or 2023. Today, we got the selling that many had expected yesterday
June 17, 2021 | Daily JAM, Morning Briefing |
The Standard & Poor’s 500 was basically flat with a loss of just 0.04% as of the close today. If you want ACTION!!! you have to look elsewhere: To the NASDAQ Composite, which was up 0.87% as of the close and to the small cap Russell 2000, which was down 1.18% at the finish.
May 16, 2021 | Daily JAM, Friday Trick or Trend |
On Friday, May 14, stocks continued their bounce from the drop in the early part of the week. The Standard & Poor’s 500, for example, gained 1.49% on the day. The technology heavy NASDAq Composite climbed 2.32%. The BIG TECH heavy NASDAQ 100 gained 2.17%. The small cap Russell 2000 picked up 2.47%. Tech stocks rebounded strongly with Apple (AAPL) up 1.98% on the day; Amazon (AMZN) ahead 1.94%; Microsoft (MSFT) higher by 2.11%; and Alphabet (GOOG) gaining 2.40%. But tech stocks weren’t the biggest winners.
May 14, 2021 | Daily JAM, Volatility |
I’d like to think that the volatility of last week is all over and a thing of the past. But I don’t think it is. This is a transitional market with sentiment moving toward value, cyclical, and post-vaccine stocks and away from technology momentum plays. And it’s also a market trying to figure out how to reprice all assets in light of a potential move to lower stimulus bond-buying and to raise interest rates at some point in the future. These kinds of transitions don’t occur smoothly and I think we can expect more volatility.
May 4, 2021 | Daily JAM, Videos |
I’m starting up my videos on JubakAM.com again–this time using YouTube as a platform. The twenty-second YouTube video “Don’t Panic: 3 Picks for This Rotation” went up today.
April 30, 2021 | AAPL, Daily JAM, Friday Trick or Trend, Jubak Picks, Top 50 Stocks, WH |
When it comes down to company earnings, we’re seeing a huge lag in revenue growth for companies in the service sector. Wyndham Hotels and Resorts (WH),for example, which reported first quarter results today, April 30, saw revenue fall to $303 million in the first quarter of 2021 from $410 in the first quarter of 2020. But, and I think this is the clear implication of the first quarter GDP numbers, those service companies will close that gap in the June quarter as companies open more services–Disney (DIS) opened its California theme parks today, for example–and consumers feel safer in going to theme parks or restaurants or gyms.
April 30, 2021 | AAPL, Daily JAM, Morning Briefing |
Data from Refinitiv published yesterday show that companies are beating estimates at a historic rate and that the amount by which they are beating projections is also at a historic high. Of the Standard & Poor’s 500 companies reporting so far, 86.8% have beat Wall Street projections. The average beat is a huge 23.5%. According to Refinitiv (where data goes back to 1994) that’s the highest percentage of companies to beat estimates for a quarter on record and also the largest average beat on record. Three things to think about.
