• Tag Archives NASDAQ
  • What You’re Not Being Told About The Real Economy

    The year 2000 was a transition year in a lot of ways. Though Y2K amounted to mild mass hysteria, people did have to get used to writing the date with 20 in front of the year rather than 19. It was a new millennium (depending on your view of Year 0) that seemed to have started off under the best possible terms.
    Not only were stocks on fire at the outset, the economy was, too. The idea of this ‘new economy’ leading toward a permanent new plateau of low inflation growth, driven by the breathtaking productivity gains in telecommunications and computing, seemed quite real on the surface. US GDP advanced by more than 3% in 15 straight quarters from Q2 1996 through Q4 1999, averaging a sizzling 4.7% in those nearly four years of dot-com supremacy.
    The labor market was clearly robust, too. In March 2000, the BLS estimates (current benchmarks) that total payrolls (Establishment Survey) rose by 468k from that February. That brought the 6-month average up to +303k, a record of expansion that also mystified economists for its lack of inflationary wage pressures. In any case, the late nineties had roared up to the doorstep of the 21st century.
    We all know what happened in April 2000, as investors suddenly got cold feet about first the high flying NASDAQ. It wasn’t just stock prices and IPOs, of course, as it really meant one of the major economic themes of that age was in danger being undermined, if not thoroughly debunked. The new economy of the 21st century might not have been grounded so solidly in true economics (small ‘e’) as everyone thought (especially those running the Fed).

    This post was published at Zero Hedge on Dec 10, 2017.


  • The “Bombshell” Reason Tech Stocks Just Suffered The Biggest Rout Since Brexit, In Two Charts

    “Last week, after making new highs, the NASDAQ ‘reversed’ to the downside. It bounced from there, but yesterday’s action was horrific, for having opened sharply, violently, surprisingly higher, by the day’s end the NASDAQ was sharply, violently, surprisingly weaker and it was so even as the Dow finished higher on the day, albeit materially below its peak. This morning, as we write, the Dow futures are higher but the NASDAQ is weaker… again!” – Dennis Gartman
    As we discussed in our overnight wrap, FANG stocks have tumbled 5.6% in last 5 sessions…
    ***
    … while overnight the MSCI World Tech index just suffered its biggest four-day drop since Brexit, as contagion from the tech-rout spread across the globe.

    This post was published at Zero Hedge on Dec 5, 2017.


  • Tax Euphoria Fades As Tech Rout Spreads

    One look at S&P futures this morning reveals an unchanged market, however it is again the violent sector rotation that is taking place behind the scenes that is the real story, with defensive sectors real estate, retail, food, utilities outperforming while investors continue to bail and book profits on tech stocks after sharp gains since the start of the year. Monday’s Nasdaq rout also spread to European and Asian markets which fall on last minute changes to the tax plan, most notably the retaining of AMT which could prevent companies from making use of intellectual property tax breaks, effectively raising their tax rates. As a reminder, on Monday the Nasdaq fell 1.2% following broad based hedge fund liquidation from the most crowded sector, after tax experts said Senate Republicans unwittingly passed a bill that would mean higher-than-intended taxes for technology firms and other corporations; in sympathy Europe’s Stoxx tech sector index SX8P hit the lowest since late September, down 8% since mid-November
    European stocks dipped, trimming the previous session’s sharp gains amid a renewed selloff in tech stocks globally and as weaker industrial metal prices weighed on mining shares which slumped ‘due to a marked slowdown in China’s metal consumption growth, with market participants foreseeing weaker public infrastructure spending growth extending into 2018,’ SP Angel analysts including John Meyer, Simon Beardsmore and Sergey Raevskiy write in note.
    The Stoxx 600 is down 0.2%, remaining in a range between its 50-DMA and 200-DMA started in mid-November. The Stoxx tech sector SX8P index falls 0.6%, mirroring a drop in the Nasdaq Monday. As noted above, Europe’s tec sector is down about 8% since a peak in early November, amid a sharp sector rotation out of momentum stocks and into potential winners of the U. S. tax reform. UK’s FTSE 100 outperforms peers amid the weaker pound which had briefly tripped through 1.34 as Brexit talks had been unravelled over disagreements from the DUP in regards to a hard border between Ireland and Northern Ireland. UK grocery retailers are among the top movers in the FTSE 100 after a positive note from Goldman Sachs. Elsewhere, to the downside, health care and material names lag.

    This post was published at Zero Hedge on Dec 5, 2017.


  • How Passing the Senate’s Tax Bill Could Lead to a Record High for the Dow Jones Today

    This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
    Investors are optimistic about the Dow Jones today following the Senate’s passage of the largest overhaul of the American tax code in 30 years.
    Dow Futures are up 246 points this morning after every Republican senator except for Bob Corker, of Tennessee, voted in favor of the reform bill. But not every investor is optimistic. Here’s the truth about the Senate’s tax bill you can’t afford to miss…
    Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
    Index Previous Close Point Change Percentage Change Dow Jones 24231.59 -40.76 -0.17% S&P 500 2642.22 -5.36 -0.20% Nasdaq 6847.59 -26.39 -0.38%

    This post was published at Wall Street Examiner by Garrett Baldwin ‘ December 4, 2017.


  • Technical Scoop – Weekend Update Dec 3

    Weekly Update
    ‘You can lead a horse to water, but you can’t make it drink’
    – old saying
    We may warn investors about the risks in the markets, but we can’t make them take action to do something about it. We recall back in late 1999/early 2000 receiving calls from people wanting to open up a brokerage account so that they could buy some tech or dot.com stock. We politely told them that to open an account would require we meet with the prospect, learn their investment goals, fill out papers, and await approval from the compliance department. The process could take more than a few days. By that time, the stock they were targeting could be up a further 10%, 20%, or even more.
    Things were moving that fast. From lows in October 1998, the tech-heavy NASDAQ index soared almost 260% to its high in March 2000. The price earnings ratio (P/E) of the NASDAQ soared to an unheard-of (and never heard of again) 175 while some individual companies had P/Es over 400. The fact that the companies did not make any money was not an issue as the focus was on their long-term potential and growth. Warnings that the market was in an unsustainable bubble and that a potential crash could follow were largely ignored. Those communicating the warnings were dismissed as doomsayers, charlatans, or worse. Some received death threats. Two years, later by October 2002, the NASDAQ had fallen 78%. The bubble had burst.
    Fast forward five years later. The Dow Jones Industrials (DJI) had soared to new all-time highs gaining 98% from October 2002 to October 2007. The NASDAQ had gained 158% in the same period but was still down 45% from the March 2000 high. But the real focus was on the hot housing market where prices had more than doubled since 2000 and where some regions saw even more spectacular growth. The growth had been spurred by the loosening of credit encouraged by government action, particularly through what was known as the Community Reinvestment Act and government agencies such as Fannie Mae and Freddie Mac.

    This post was published at GoldSeek on 3 December 2017.


  • The Dow Peaked At 14,000 Before The Last Stock Market Crash, And Now Dow 24,000 Is Here

    The absurdity that we are witnessing in the financial markets is absolutely breathtaking. Just recently, a good friend reminded me that the Dow peaked at just above 14,000 before the last stock market crash, and stock prices were definitely over-inflated at that time. Subsequently the Dow crashed below 7,000 before rebounding, and now thanks to this week’s rally we on the threshold of Dow 24,000. When you look at a chart of the Dow Jones Industrial Average, you would be tempted to think that we must be in the greatest economic boom in American history, but the truth is that our economy has only grown by an average of just 1.33 percent over the last 10 years. Every crazy stock market bubble throughout our history has always ended badly, and this one will be no exception.
    And even though the Dow showed a nice gain on Wednesday, the Nasdaq got absolutely hammered. In fact, almost every major tech stock was down big. The following comes from CNN…

    This post was published at The Economic Collapse Blog on November 29th, 2017.


  • Momo Massacred, Semis Slaughtered After Topping 2000 Peak, Nasdaq ‘VIX’ Spikes

    CNBC busily defending the utter bloodbath in semi stocks as nothing to worry about… but this is the biggest plunge for these market darlings since Brexit (June 2016)…

    …and just happens to have occurred as the index finally cleared the 2000 dotcom peak…

    This post was published at Zero Hedge on Nov 29, 2017.


  • “The Leaders Are Crashing” – It’s Not Just Junk Bonds That Have Given Up

    We have been warning about significant divergences between equity prices and other asset classes for a few weeks (most notably the decoupling from equity risk and credit risk, junk bonds), but as BofA notes its not just these assets that are breaking away from soaring Nasdaq levels, in fact many of the rally’s leaders are crashing… in a way we have not seen recently.
    High yield risk has suddenly decoupled from equity markets…

    This post was published at Zero Hedge on Nov 10, 2017.


  • This Has Never Happened Before To The Nasdaq

    No 52-week high in the Nasdaq 100 has ever been accompanied by as few advancing stocks as today’s. As most readers know, we are big proponents of strong breadth, or participation, in signifying healthy markets. When rallies are accompanied by a large swathe of advancing stocks, it is more likely to go further and last longer than those coming on the back of just a relatively few stocks. As such, it was encouraging to see the significant level of participation during the August-October stock market rally. Recent efforts, however, have not been so robust. Today’s action on the Nasdaq exchange is Exhibit A. On the one hand, the Nasdaq 100 (NDX) managed to rally – again – closing at a new all-time high – again. Despite the new high, however, the breadth on the Nasdaq read as follows (according to our vendor):

    This post was published at Zero Hedge on Nov 8, 2017.


  • FANG Futures Launch

    The other day, after reading one of my posts, my old boss sent me a note. It was a comment about the madness of investors chasing the hot momentum tech stocks.
    ‘We were reminiscing about this stuff last night and I clearly remember that near the end [of the DotCom bubble], CNBC decided to have the CEO of International Paper on Power Lunch. They immediately received what they said was hate mail. After that, the NASDAQ fell from 5200 to 2000 and it ushered in one of the greatest bull markets ever in old economy stocks (2001-2008).’
    I thought that was a great insight. The mood at the top is downright hostile towards other investing themes.
    I am not sure if we are at an equivalent point. It sure feels like the ‘Just own the damn robots’ mantra has engulfed the collective psyche of the investing public, but hey – we all know what Keynes learned the hard way.

    This post was published at Zero Hedge on Nov 8, 2017.


  • Stock and Awe, Bears in Bondage

    The Trump Rally pushed ahead relentlessly through a summer full of high omens and great disasters, all which it swatted off like flies. Even so, all was not perfect in the market as nerves began to jitter midsummer beneath the surface even among the most longtime bulls. Wall Street’s fear gauge (the CBOE Volatility Index) lifted its needle off its lower post to a nine-month high after President Trump’s comments about ‘fire and fury’ if North Korea didn’t toe the line. (Mind you, the high wasn’t very far off the post because of how placid the previous nine months had been.)
    As volatility stirred languidly over the threat of nuclear war, stock prices took a little spill with all major stock indices seeing their biggest one-day drop since May. The SPX fall amounted to a 1.4% drop in a day – nothing damaging. The Dow dropped about 1% in a day. But beneath the surface, the market is looking different and shakier.
    For example, trading narrowed to fewer players as more stocks in the Nasdaq 100 finally moved below their fifty-two week lows than moved above them. Likewise in the S&P. This phenomenon is known as the ‘Hindenburg omen,’ and tends to precede major crashes.

    This post was published at GoldSeek on 7 November 2017.


  • Summing Up 2017 In Two Record-Breaking Charts

    What can we say about 2017 that hasn’t been said already, as it continues to smash records?
    Per Ryan Detrick, Senior Market Strategist, ‘2017 will likely be remembered for two things: a persistent bullish trend and historically low volatility.’ In fact, here are two more records that prove that point.
    The Nasdaq has never made more all-time highs than the 63 it has made (so far) this calendar year, topping the previous record of 62 set in 1980.

    This post was published at Zero Hedge on Nov 6, 2017.


  • Warming Economy, Red Hot Stock Market

    With 15% gains in the major stock indices (Nasdaq 28%) stocks are on pace for their 4th best year since 1999. Precursors of accelerating economic growth abound in 2017, reflective of the rebounding earnings and future expectations. The stubbornly sluggish US GDP continues to hover near its 2.1% post mortgage bubble 7-year expansion cycle. Underlying proxies of manufacturing and service sectors are approaching historic rates of expansion with record demand for job seekers. Factories are struggling to find capacity as New Orders and Shipments are outpacing depleted customer inventories. Today’s 3.0% GDP report for the 3rd quarter, following the 2nd quarter pace of 3%, is a strong sign that real growth is finally percolating to the economy’s bottom line GDP.
    US Manufacturing as measured by ISM’s Purchasing Managers Index (PMI) hit a 13 year high in September, one of the most comprehensive rates of expansion ever recorded. Should legislative winds provide corporate tax cuts and an estimated $3 Trillion repatriation of foreign earnings in 2018, then there may yet be hope for GDP growth rates above 3% despite the impedance of a tight labor pool. Lower business taxes here would boost global growth as other countries follow suit.

    This post was published at FinancialSense on 11/02/2017.


  • Tax Turmoil & China Contagion Slam US Stocks, Treasury Yields Tumble

    Is it the bears turn now?
    Chinese bonds and stocks were ugly overnight as the calm of the congress came to an end…
    Small Caps were slammed today – worst day since August. Nasdaq managed to scramble back to green in the last few mins, but failed to hold it…

    This post was published at Zero Hedge on Oct 30, 2017.


  • Is It Finally Time To Buy Stock Market Vol?

    ‘You’re such an idiot,’ one of my new hedge fund manager reader friends wrote me the other day. ‘You spent the last couple of years warning about the possibility all of this Central Bank monetary madness causing a huge rip higher in risk assets. And here we are, it is finally here, and instead of taking a victory lap, you are monkeying around trying to fade the rally by buying Nasdaq put spreads. You’re incorrigible’
    Yeah, my pal is right. If I am being honest, this is my biggest weakness. Too often I am contrarian to the point of my own detriment. I have never been good at riding an overly popular trade to its fullest.
    It was easy for me to trade stocks from the long side when everyone was scared about the next crash. Yet now that most everyone has abandoned their fear, I find it almost impossible to stay long as they push it higher and higher.
    And to be truthful, for a fleeting moment last week, I felt like I might do the impossible, and catch the top in the stock market. After grinding higher for the past week during the Chinese Communist Party Congress meeting, as Beijing was wrapping up, stocks finally looked like they were ready to sell off.

    This post was published at Zero Hedge on Oct 30, 2017.


  • Stocks and Precious Metals Charts – FANG’d

    “Und der Haifisch, der hat Zhne
    und die trgt er im Gesicht
    und Macheath, der hat ein Messer
    doch das Messer sieht man nicht.”
    Berthold Brecht, Die Moritat von Mackie Messer, 1928
    The results after the bell last night from the usual big cap tech suspects lit a fire until the Nasdaq 100, as you can see from the chart below.
    That is the look of real pain for the big cap tech bears.
    There will be an FOMC meeting next week. President Trump has also indicated that he will be naming the next Fed Chair.
    And as usual with the beginning of a new month, we will be having a Non-Farm Payrolls Report on Friday November 3.
    Have a pleasant weekend.

    This post was published at Jesses Crossroads Cafe on 27 OCTOBER 2017.


  • Bitcoin Gold Prices Plummet 72% in Just Three Days

    The hard fork that created Bitcoin Gold hasn’t worked out for speculative investors thus far. On Oct. 23, Bitcoin Gold opened at $479.82, but has fallen today (Thursday) to $130.34.
    Bitcoin, in comparison, climbed 7% today and is pushing near its all-time high of $6,000.
    The price of Bitcoin increased by about $550 in the last 24 hours as markets shake off concerns about the Bitcoin Gold hard fork.
    There have also been a few rumors that Amazon.com Inc. (Nasdaq: AMZN) could announce plans to accept Bitcoin on its platform during its Thursday earnings call. However, those rumors are based on pure investor speculation.
    Also in cryptocurrency news, markets were largely unfazed by statements made by the governor of the United Arab Emirates (UAE) central bank.
    Mubarak Rashed Al Mansouri has raised concerns about the lack of supervision around the cryptocurrency industry and suggested that Bitcoin is being used for illicit activity.
    ‘Some nations have announced that they are not using Bitcoin, and consequently, its value sharply plummeted. In addition, it can be easily used in money laundering and in funding terror activities,’ the central banker said.
    Below is a recap of the top cryptocurrency prices at 11:00 a.m. EDT

    This post was published at Wall Street Examiner on October 26, 2017.


  • ‘Party Like It’s 1999’ (or 2008 or 1987 or 1929)

    To paraphrase the highly regarded fund manager and notable bear, John Hussman, you can look like an idiot before a Bubble pops or after it’s popped.
    I guess I’m squarely in the camp of looking like an idiot before the bubble pops. I might watch ‘The Big Short Again’ for some ‘moral fortitude.’ With history’s stamp of approval on my side, all I can do is shake my head and chuckle. As soon as the Dow crossed over 23,000 on Wednesday, the ‘experts’ on bubblevision began speculating how long it would take for the Dow to hit 24k. I was actively trading and shorting dot.com stocks in late 1999 and the curent environment feels almost exactly like it felt then. Wake up everyday and wait for Maria Bartiromo to breath the name of a dot.com stock you were short and watch it spike up 10-20% on her signal. The Nasdaq ran from 2,966 to 4,698 – 1,700 pts or 58% – in 4 months. It was painful holding shorts but very rewarding after the brief period of ‘suffocation.’
    It feels like the market could go into a final parabolic lift-off to its final peak before the inevitable. The non-commericial (i.e. retail) short-interest in the VIX – meaning retail investors are ‘selling’ volatility – hit another all-time high this past week. This a massive and reckless bet against any possibility of any abrupt downside in the market. It reflects unbridled hubris. Don’t forget, smart money and banks are taking the other side of this bet.

    This post was published at Investment Research Dynamics on October 25, 2017.


  • The Market Melt-Up Before the Top

    The following is a summary of our recent Big Picture podcast, ‘The Meltup Before the Meltdown,’ which can be accessed on our site here or on iTunes here.
    We’re likely near the end of this business cycle, says Financial Sense’s Jim Puplava, and normally when we come to the end, all seems well: the economy is booming, stocks are hitting records, and people are making money.
    For example, think back to the stock market in 1999 and the first 3 months of 2000. The Nasdaq went vertical in a classic, melt-up euphoria as everyone piled into the sector driving the “New Economy”.
    As we move closer to the top of this market, we’re more likely to see euphoria, he added. Right now, mutual funds and stocks are going up by double digits. Unemployment is low, consumer confidence is high, retail sales are up, and the economy is booming. All of these indicators normally occur around the end of the cycle, and we know what eventually triggers that end: a Fed rate raising cycle, which we are now in.

    This post was published at FinancialSense on 10/23/2017.