Mike’s Morning Brief – April 19, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike's Morning Brief

This Market continues its sideways action with a downward bias. It’s been correcting since hitting the new, all-time highs in February.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened higher after much of Monday’s gains were erased by Tuesday’s losses.  Importantly, stocks closed well off their lows yesterday.  But we have seen decliners 4 of the last 5 trading days.  This Market continues its sideways action with a downward bias.  It’s been correcting since hitting the new, all-time highs in February.  Corrections can come with time rather than price.  That’s what this feels like, a healthy consolidation before setting up for higher levels into Summer.  That’s still our thesis.  But we are very mindful that things can change.  Geopolitics are a total wild card, but so far have been somewhat manageable.  These are really challenging issues with no easy solutions.  When the facts change, so do we. The French election is looming, and too early to call.  Expectations are for the left leaning, pro-EU candidate to win.  It sounds like the US aircraft carrier Vinson did not make its way to the Korean peninsula after all.  Earnings haven’t brought the positive tone expected quite yet.  IBM is weighing heavily on the DOW with its 20th consecutive Qtly revenue decline.  Morgan Stanley reported a double beat, sending the stock higher.  Interest rates are ticking up again, with the 10-Year Treasury yield back above 2.2%.  Crude is getting lift as well.  Gold has been strong the last few days, and is taking a breather in early trading.  The Dollar is higher after an extended period of weakness, which is mostly mean reversion from super strength.

Have a great day.
Mike

 

Mike’s Morning Brief – April 12, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike's Morning Brief

Mike’s Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened in the red again after a pretty wild session yesterday saw early losses largely erased. Global Markets were mixed overnight. Geopolitics and emotion seem to be taking the lead right now, but fundamentals and technicals remain the underlying drivers. Earnings will take the lead again starting tomorrow. Crude is going for 7 straight daily gains. Secretary of State Rex Tillerson is still in Moscow to discuss Syria, Ukraine, and whether the US and Russia can find common ground. At the same time, a U.S. carrier group moves on waters around North Korea. The G7 decided against Russian sanctions, something the US was pushing for. Money keeps flowing into Bonds, with the 10-Year Treasury yield below 2.3%. Gold is higher too. Tax reform is looking less likely in 2017.

Have a great day,

Mike

Mike’s Morning Brief – March 29, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened flattish on this historic day.  The United Kingdom has officially triggered the formal process of leaving the European Union by invoking Article 50 of the Lisbon Treaty.  A 2-year window for negotiations has begun.  This is no surprise.  The road ahead will certainly bumpy.  It’s never happened before.  Global stocks caught a bid after our Markets accelerated higher, putting an end to the 8-day losing streak.  British stocks are at all-time highs.  Chicago Fed President Charlie Evans said he sees inflationary pressures supporting higher rates.  But he also said he sees little growth above 1.75% for GDP.  That number is pretty low compared to consensus.  Energy came to life yesterday after being grossly oversold.  We still believe it goes higher led by WTI, which is back above $48.  It’s interest that rates are holding firm with the 10-Year Treasury below 2.4%.  The Dollar is catching a bid as is Gold in early trading.  Expect the volatile price action continue, with an upward bias this Spring.

Have a great day.

Mike

 

 

Mike’s Morning Brief – March 15, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike's Morning Brief - March 15, 2017

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened in the green on this March Fed day.  Beware the ides of March.  A rate hike is expected and investors will follow closely, every word in the statement and every word in the press conference.  The US economy has been accelerating.  Interest rates are finally going higher for the right reasons. Oil is catching a bid after a few ugly sessions.  Energy’s underperformance has started to infect the broader Market.  It’s catching a bid this morning, which is helping.  Donald Trump’s tax returns became an issue again, as his 2005 return was leaked and shown on MSNBC last night.  It showed that he made money and paid taxes and donated to charity.  Some believe he was the one who leaked it.   Dutch voters head to the voting booth today.  Elections continue to be the theme, and right wing protectionism is gaining momentum.  China publicly said they don’t want a trade war with the US.  Secretary of State Rex Tillerson will be in China on Friday.  The G20 will have plenty to talk about this week at their first session of the year.

Have a great day.

Mike

 

Mike’s Morning Brief – March 8, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened in the green with a solid ADP report for February, suggesting Friday will bring another solid jobs report.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened in the green with a solid ADP report for February, suggesting Friday will bring another solid jobs report.  Interest rates are jumping with the Fed meeting now a virtual lock for a rate hike next week.  The 10-Year Treasury yield is pushing 2.6% for the first time this year.  Global Markets were mixed overnight with gains in Europe and declines in Asia.  China reported some disappointing economic data, but it really isn’t that much of a surprise.  China’s multi-year transition from exports to consumption continues to have bumps.  Appaloosa’s David Tepper is grabbing headlines this morning with his repeated Bullish Outlook for the US and European Markets.  He sees global growth accelerating.  It’s a theme we’ve been saying for a while and more importantly, acting on.  Most investors have been frozen on the defensive.  That said, the DOW and S&P closed lower yesterday, marking its first 2-day decliner in 2 months.  And not insignificant, there were more 52-week lows than 52-week highs on the NYSE.  The last time the NYSE had more new lows than new highs while the SPX less than 1% from new highs was July of 2015. Anyone remember Aug 2015?

Mike

Mike’s Morning Brief – March 1, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market is soaring to start the month of March on the back of what has to be considered a much better than expected speech from our new President and more solid economic data around the globe.

Mike’s Morning Brief: A fast-break rundown of what’s going on.
 
Market is soaring to start the month of March on the back of what has to be considered a much better than expected speech from our new President and more solid economic data around the globe. The record tying 12 consecutive new highs came to an end yesterday. A new streak has begun. DOW hit 21K this morning, a level never before reached. It hit 20K just 24 trading days ago. The only thing that has changed really is perhaps psychology. If we can actually see some bipartisan action, there’s no stopping this Market. But realistically, there was little detail in Trump’s address to Congress last night and the likelihood of Republicans and Democrats working together is still very small. But the tone felt much better.
 
Donald Trump seemed very Presidential last night. Perhaps that is what mattered most. Interest rates are jumping off increasing expectations of a rate hike this month. The Dollar is stronger too. Crude Oil is higher while Gold is lower. There is a great deal of movement under the surface. It all suggests growth.
 
Have a great day.
Mike

 

Mike’s Morning Brief – February 22, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened flattish after yesterday saw the 10th record close since the inauguration. S&P 500 hit $20 Trillion in Market Cap for the first time in history.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened flattish after yesterday saw the 10th record close since the inauguration.  S&P 500 hit $20 Trillion in Market Cap for the first time in history.  It is now up 10% since the election.  The rally has hit a stage where it feels overbought.  Bears and skeptics appear to have thrown in the towel fighting this tape.  It feels like it’s ahead of itself and another breather or selloff is warranted.  Corporate earnings and economic growth, both here and abroad, have accelerated.  The Market has gone a long way to price it in.  We see more signs of leadership rotation, but in general we are banking some gains and building up cash to buy weakness.  Financials have gone straight up and need to correct the moves a bit.  Conversely, Energy is an area that looks set for another run.  WTI has gone sideways for months in the low $50’s, consolidating the 100% gain from the 2016 lows.  A move towards $60 is very doable.  Russia overtook the Saudi’s as the largest oil producer.  Interest rates are ticking down ahead of the Fed Minute release this morning.  The Market is looking for clues as to how many rate hikes are ahead.  The Dollar is staying firm.  So is Gold.

Have a great day.

Mike

 

Mike’s Morning Brief – February 15, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened flattish after another strong session took the major indices to fresh, all-time highs.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened flattish after another strong session took the major indices to fresh, all-time highs.  In fact, the S&P is going for 7 consecutive gainers, something it has not done in 3 1/2 years.  And the thing is, it is coming in the face of confusion and skepticism surrounding the White House.  This move is completely counterintuitive to the masses, and our clients are appreciative but quite concerned.  I hear it every day.  Global Markets were higher overnight in the wake of yesterday’s rally.  Interest rates are jumping, with the 10-Year Treasury yield over 2.5% again off Yellen’s first day of testimony on Capitol Hill.  She indicated another rate hike could be coming sooner than thought if economic expansion continues at current rate.  The Dollar had its best day of the year, riding an 11-day win streak.  Retail executives are visiting the White House to speak out about the negatives a proposed border tax.  President Trump will also meet with Israeli Prime Minister Benjamin Netanyahu today.  Crude prices continue to trade sideways in the low $50’s.  It’s actually pretty impressive considering it doubled from the 2016 lows.

Have a great day,

Mike

 

Mike’s Morning Brief | February 8, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike’s Morning Brief: Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened in the red a day after the DOW, S&P and NAS hit new intra-day highs, but failed to hold them.  Oil continues to slide to $51 on large production numbers.  Brexit could be official as early as today. Earnings keep coming with mixed tones.  Disney missed and Gilead beat, but lowered its outlook.  India kept rates unchanged again, which was a bit of a surprise.  The ruling on the travel ban freeze should come from a San Francisco court at any time.  We have a new Secretary of Education, but she is not widely popular.  Interest rates are lower as is the Dollar, while Gold catches an early bid.

Have a great Day.

Mike

 

 

Mike’s Morning Brief – January 25, 2017

Mike's Morning Brief

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Mike's Morning Brief - January 25, 2017

Market opened sharply higher with the DOW finally taking out that big round 20K level for the first time ever.

Mike’s Morning Brief: A fast-break rundown of what’s going on.

Market opened sharply higher with the DOW finally taking out that big round 20K level for the first time ever.  Wall Street loves stuff like this.  The S&P 500 and Nasdaq closed at new record highs yesterday and are building on them again this morning.  The rally carried overseas as Global Markets were higher overnight.  President Trump continues to move forward on promises.  Yesterday he gave executive orders to move forward on the Keystone pipeline and begin the process of building the wall along the Mexican border.  Earnings continue to pour in with a fairly positive tone.  The Dollar is weaker while interest rates are higher.  WTI is down slightly.  Today will be all about DOW 20K no doubt.  

Have a great day.
Mike

 

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