December 17, 2017 | Daily JAM, Short Term |
Reports on home sales this week will get more attention than usual given the cuts to the mortgage deduction in the tax bill that moved out of the Senate/House conference committee last week. Worries about the pace of home sales manage to combine uncertainty about the effects of the Republican tax plan and the impact of higher interest rates from the Federal Reserve. Investors are watching the housing numbers as an early indicator of any weakness in the general economy.
December 15, 2017 | Daily JAM, Morning Briefing, Short Term |
Just about everything is up today on news that Senator Marco Rubio has changed a possible “No” from Thursday into a “Yes” vote today. The tax cut bill now looks extremely likely to move out of conference committee and to pass the Senate–the major obstacle–and wind up on President Trump desk for his signature before Christmas..
December 11, 2017 | Daily JAM, Notes You Need |
In my daily trawling through the market I come upon lots of tidbits of knowledge that I think are important to investors but that don’t justify a full post. I’ve decided to start compiling these notes here each day in a kind of running mini blog that I’m calling Notes You Need. Post includes items like this from today: “Investment  bank Cowen & Co. estimates that Amazon (AMZN), Alphabet (GOOG) and Facebook (FB) will save a combined $4.5 billion  on taxes in 2018 thanks to the Republican tax bill. The tech giants, Cowen also notes, should in addition benefit from the bill’s capex expensing provision. The investment bank sees big earnings per share gains for the companies with Amazon showing an expected earnings upside of 24%, and Alphabet and Facebook seeing 8% earnings increases.”
December 7, 2017 | Daily JAM, Uncategorized |
Will bank stocks in general–and shares of Bank of America (BAC) in particular–take a hit when they report huge fourth quarter “adjustments” and create an opening for a call options play on the 2018 earnings story? Bank stocks have been soaring on the belief, first, that the election of Donald Trump, would provide them with substantial relief from costly regulations and, second, on the belief that banks would be big winners from the tax bill that is now so close to passing Congress. But, to get to those golden days in 2018, banks first have to pass through a fourth quarter from hell. Adjustments to earnings–as result of provisions in the tax bill–will take billions out of bank earnings.
December 4, 2017 | Daily JAM, Morning Briefing |
Technology shares continue to sell off today and bank shares continue to climb as the financial markets react with optimism to the Senate’s vote to pass a Republican tax cut. Today everyone is looking for a sector that might benefit from the legislation. Car dealerships are up on a favorable bit of tax treatment in the bill, for example. But even restaurant shares are soaring on a vague belief that the sector will benefit from faster economic growth
December 3, 2017 | Daily JAM |
Expect the financial markets to wage an internal scuffle over whether to go up because the Senate passed a package of tax cuts–sorry, “tax reforms”–that nobody had read or retreat because the December 8 deadline for funding the government is fast approaching. I’d say the odds are that the financial markets will climb.
November 28, 2017 | Daily JAM, Morning Briefing, Short Term |
When President Donald Trump met with Congressional leaders last September, he emerged with a surprise deal with Democrats Chuck Schumer and Nancy Pelosi to extend funding for the Federal government for three months–until December 8–and to temporarily suspend the ceiling that caps Federal government debt. Not this time, Trump tweeted today
November 26, 2017 | Daily JAM |
The battle over the Republican tax cut bill in the Senate will draw most of the attention in the headlines. But the week includes other market moving news on retail sales and OPEC plans for extending production curbs.
November 19, 2017 | Daily JAM |
Expect fevered negotiations in the Senate this week on that house’s tax cut bill. Senate leaders have promised a vote shortly after Thanksgiving. And even if their bill passes, it’s really just the beginning of a much harder fight. I think it’s best to treat this week as a kind of dry run.
November 16, 2017 | Daily JAM, Morning Briefing, Short Term |
Today the Standard & Poor’s 500 stock index added 0.8%, the Nasdaq Composite climbed to a new all time high and the Russell 2000 small cap index rose 1.6%.The action put an end to what I’d call a “market wobble” that had seen the S&P 500 fall in four of the last five trading sessions. Volatility had been rising during that period with the implied volatility in the S&P 500 futures market climbed to plus/minus 30 points for this week from just plus/minus 20 points last week. But the very solid move today says that “Buy on the Dip” remains in force.
November 12, 2017 | Daily JAM, Friday Trick or Trend |
The House version of the tax cut legislation is headed for a planned vote in the full House of Representatives this week. The Senate Finance Committee is scheduled to begin consideration of its version of a tax cut bill on Monday. Republican leaders in the Senate say they want to hold a vote in the full Senate before Thanksgiving, which falls on November 23 this year. The problem–and it’s just a teeny, tiny one–is that the two bills aren’t compatible.
November 9, 2017 | Daily JAM, Morning Briefing |
Jittery. That’s how I’d characterize action on U.S. stock markets today. As of just before 4 p.m., the Standard & Poor’s 500 stock index was off 0.32%. The NASDAQ Composite was lower by 0.56%. And the small cap Russell 2000 was down 0.46%. These aren’t huge declines but they do stand out in contrast to the steady gains the market has piled on in most days recently. The most obvious explanation is worry over the fate of the tax cuts in Congress
