Mike’s Morning Brief – July 19, 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 opens flattish again, with the S&P and NAS at fresh highs and the DOW in spitting distance. Earnings have thus far been solid, but unspectacular. Conviction seems to be lacking with a lot of complacency seemingly built up in investor psyche. Volume has thinned quite a bit. It happens every year. It’s Summer. Morgan Stanley had some nice things to say this morning, which is sending the stock higher in early trading. Deflation is a diminishing risk in Europe, so says the ECB. Trade was a theme at a US-China business leaders summit in Washington. The private sector is collaborating to address crippling trade imbalances across the Pacific. Apple hired a new executive to lead its China business, with plans to turn it around. The theme of the week is earnings. The S&P is expected to earn $31.42 in Q2. That would translate to an 8.1% increase year-over-year. Q1 saw 15% growth, the largest quarterly increase since 2011. Earnings expectations for Energy have come down quite a bit with falling Oil prices. 10 of the 11 S&P sectors are expected to record positive year-over-year earnings growth in Q2, but only 3 are expected to beat the total 8.1% gain. Energy, Tech and Financials are expected to grow faster, while the rest of the sectors are expected to grow slower than the composite. Tech and Financials are the 2 largest sectors in the S&P, which means they have the greatest impact.

Have a great morning,

Mike Frazier

 

Mike’s Morning Brief – June 28, 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 opens in the green after a pretty ugly session for Tech yesterday. The NAS fell nearly 2% yesterday as leadership rotated again. Financials caught a bid, seeing the majority of the flows. We expect more choppy action as the Qtr closes out. The vote on the Senate Health Care Bill got pushed out to after July 4, sending stocks lower, particularly those in the Medical arena. As it stands, the Republicans don’t have the votes. The second stage of the Fed stress test comes today, which should be positive for Financials. The Dollar continues to weaken against the Euro. Crude is stable ahead of the inventory report, which will no doubt have influence on oil prices. Interest rates have jumped the last 2 days, with the 10-Year Treasury yield back above 2.2%.

Have a great morning,

Mike Frazier

 

Mike’s Morning Brief – June 21, 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 opens in the green on the Summer solstice. It’s the longest day of the year. Crude officially fell into Bear Market territory, with a 20% decline on the year. It’s trying to get a lift in early trading. In a major move, the Saudi kingdom has shaken up its leadership, which will have a profound impact on global issues going forward. Relations with Iran is at the top of that list. Global stocks rallied on the move. There was another attempted terror attack in Belgium, but fortunately it was defused before more serious damage was done. The Congressional election widely watched in Georgia went to the Republican candidate, a big win for the GOP and another gut buster for Democrats who are looking towards 2018 for power reversal. This should help the timeline for tax reform and other pro-growth policies from the White House this Fall. Tropical Storm Cindy is the first Hurricane-like storm heading to the Gulf Coast this year. Hurricane season has begun. It could play a role in oil production. The DOW and S&P remain near all-time highs. Expect Summer turbulence to return.

Have a great morning,

Mike Frazier

 

Mike’s Morning Brief – June 14, 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.

Market opens flattish ahead of the conclusion to the Fed meeting and the subsequent statement and press conference. A 1/4 point hike is expected. There was a shooting at a Congressional baseball practice in Alexandria, hitting Majority Whip Steve Scalise, who was wounded but appears to be stable. Interest rates are falling fairly precipitously, most likely in response to the shooting, but also suggesting the Market doesn’t believe there will be much in the way of rate hikes beyond today. A weaker inflation number for May supports the Fed holding back. Attorney General Jeff Sessions was grilled on Capitol Hill yesterday, as the turmoil around the Russia investigation continues. Tech got a bounce yesterday after significant losses the last 2 trading days. Energy and Financials and Healthcare have picked up, as leadership rotated. Gold is catching a bid in early trading this am, after a couple of weak sessions. Oil is lower as is the Dollar. The DOW and S&P are at new, all-time highs.

Have a great morning,

Mike Frazier

 

Mike’s Morning Brief – June 7, 2017

Mike's Morning Brief

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

Market opens in the green as this sideways price action near all-time highs persists ahead of what will be an eventful Thursday…

Thursday brings an ECB meeting, the British election, and the testimony from Former FBI Director James Comey on Capitol Hill.  President Trump announced his nominee for the vacant FBI Director role, and he announced it via Twitter.  President Trump heads to Ohio today to promote a $1 Trillion infrastructure bill which is part of his pro-growth policies he campaigned on.  Energy caught a bid yesterday, and seems to be holding it this morning, despite lower oil.

A turn could be coming.

Elon Musk continues to reinvent the auto industry and is spending up the process of manufacturing.  TSLA hit fresh new highs again this morning in early trading.

Keep those belts buckled.

Have a great morning,

Mike Frazier

Mike’s Morning Brief – May 31, 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.

Market opened in the green but quickly reversed to the red, as the Bull continues to chug along amidst tremendous turmoil and confusion. Much of the issues are political and geopolitical in nature, while Corporate America continues to execute efficiently, though without clarity on taxes and policy from Washington. Global Markets were largely higher on the back of more solid economic data from China. The vote in the UK is going to be anything but decisive for Prime Minister Theresa May’s vision, a complete reversal from a month ago. Crude prices continue to leak while money has been flowing back to bonds. The 10-Year yield is sticky around 2.2% for now. All indications are President Trump will pull the US from the Paris Climate agreement. That’s not pleasing to many, including some of his cabinet members including Secretary of State Rex Tillerson. China, India and the EU have reaffirmed their commitment to the agreement. The Market correction we had been expecting seems to be upon us.  The defensive moves we’ve made in recent weeks should provide some insulation to the sell-off.

Have a great day.

Mike

Mike’s Morning Brief – May 24, 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: A fast-break rundown of what’s going on.
Market opened flattish this morning after the S&P banked its 4th consecutive increase and the index is back near all-time highs at 2400.  The concerns about the Trump campaign’s ties to Russia seem to have dissipated, though the investigation keeps moving forward.  The President is in Italy today, continuing his international trip with a meeting with the Pope at the Vatican.  China got a credit downgrade from Moody’s.  The Fed releases their minutes from their last meeting today.  Investors will be interested to see what they say about its $4.5 Trillion balance sheet.  Canadian and Mexican leaders met to discuss the future of NAFTA, and how they need to work together with the US to modernize the trade agreement.  Europe has improved significantly economically, but stress still exists in the system according to the ECB.  British PM Theresa May sent armed forces throughout the UK after raising the terror level in response to the bombing in Manchester.  The Fiduciary rule is set to go into effect in June.  It will have little impact on us, as we have been fiduciaries for over 40 years, always acting in our clients best interest.  Crude prices are holding $51 ahead of the OPEC meeting this weekend. Gold is higher again while interest rates are flat.
Have a great day.
Mike

 

Mike’s Morning Brief – May 17, 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 – May 17, 2017

 

Mike’s Morning Brief: A fast-break rundown of what’s going on.
Market opens lower as the issues at the White House continue to escalate and the severity of the situation is growing by the minute.  For most of the 7 months since President Trump was elected, the Market has taken his controversial and unconventional behavior in stride.  The focus has been on earnings and economic acceleration.  It feels a little different now, and the controversy with classified intelligence and Russia is catching up to the President.  The Market is likely anticipating the prospects for tax reform are slipping away while the White House scrambles to maintain composure.  Interest rates are lower, as money flows to Bonds for some safety.  Gold has been catching a bid as well.  The Dollar is weaker this morning, and has been for a while.  Oil is slightly higher in early trading with WTI around $49.  Earnings Season is basically over, and was very solid, with the S&P growing earnings over 13% in Q1.  But the focus will naturally turn towards Geopolitics, which will bring more volatile price action to the mix.  So many investors haven’t trusted this rally and are shocked that the Market has gone up as much as it has this year.   There hadn’t been a 1% decline on the S&P in 2 months and only a handful since the election.  That changed today.  Tighten those belt and hang on for the ride.
Mike

 

Mike’s Morning Brief – May 3, 2017

Mike's Morning Brief

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

Mike's Morning Brief -May 3, 2017

“Market opened in the red on this Fed day. Rates won’t hike, but how the FOMC frames the outlook for the US economy will move the Market.”

Mike’s Morning Brief: A fast-break rundown of what’s going on.
Market opened in the red on this Fed day.  Rates won’t hike, but how the FOMC frames the outlook for the US economy will move the Market.  Economic data has been a little mixed of late, showing some signs of sluggishness.  ADP had an inline report for private sector jobs.  The Non-Farm payroll report comes Friday.  Interest rates are ticking down ahead of the Fed statement.  Apple had another solid Qtr, despite missing on revenues.  The stock is slightly down on the news weighing a little on the major indices in early trading.  The French election is gaining momentum again, with a candidate debate today.  The vote is Sunday and will be watched very closely.  The EU issued a bigger bill to the UK for Brexit.  No surprise, the Brits are pushing back.  President Trump sent another head scratching tweet, saying a government shutdown would be good.  The price of Oil remains weak, below $48 now, near the lows on the year.  Gold has been weak as well.
Have a great day.
Mike

 

 

Mike’s Morning Brief – April 26, 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 the 2 best sessions on the year have taken the major indices back to their all-time highs. The NAS punched thru 6K for the first time ever.

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

Market opened flattish after the 2 best sessions on the year have taken the major indices back to their all-time highs.  The NAS punched thru 6K for the first time ever.  The DOW cleared 21K again yesterday.  The Trump administration will roll out its tax plan today, which is something the Market has wanted.  The goal is to simplify the tax code which pretty much everyone but tax professionals desperately want.  Details are few, but it sounds like a repatriation of offshore cash will be included.  Initial talks were for a 15% corporate rate, which will not happen.  But it’s a start to have the conversation.  Earnings continue to pour out, as Twitter finally has something good to say about a Quarter.  Interest rates keep ticking higher while Crude and Gold have been sluggish this week.  The Dollar is stronger in early trading.

 
Have a great day.
 
Mike

 

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