Posts by Michael Santoli

  • Traders flinch in global selloff. GE tests the bulls: What to watch

    Michael Santoli at Yahoo Finance 15 hrs ago

    Here’s what to watch during the trading day.

    The markets this year have been a version of the old playground game “two for flinching.” That’s where one kid fakes punching your arm, and if you flinch he gets two free shots as punishment.

    There have been so many plausible excuses for the stock market to suffer a more stinging setback than it has – earnings on the slide, Greece flirting again with insolvency, the Fed looking for a chance to play bad cop.

    Yet anyone who flinched too soon and sold quickly was forced to watch the big indexes gain their footing again and return to the cusp of all-time highs. Global money printing, firming economies in Europe and a sturdy credit-market backdrop have lent support.

    This is the pattern that has driven the percentage of small investors saying have a “neutral” outlook on stocks to a 12-year high last week.  

    So maybe today’s run of news will serve as still more feigned punches thrown at the cautious investor. But for those watching, we got another surge in Greek bond yields as hopes fade for a satisfactory resolution to the bailout standoff there. German 10-year yields are plumbing the zero line.

     

  • Social app Tilt offers easy way to collect cash, for causes or keg parties

    Michael Santoli at Yahoo Finance 1 day ago

    Mobile payment is threatening to overtake social messaging as the fiercest digital land grab, with dozens of companies large and small desperate to help you use your smartphone to send or spend your money with a tap or swipe.

    The mobile-money app Tilt has distinguished itself from the buzzing swarm of consumer-payment and peer-to-peer money-transfer services by placing social circles at its core.

    In the attached video, Tilt founder and CEO James Beshara describes his three-year-old app as “the easiest way to collect money from a group of friends for free” and as “crowdfunding for groups of friends.”

    On the platform, anyone can set a target amount of money to be raised, for a specified purpose, from an invited group. Once the preset amount is reached, or “tilts,” each contributor is charged.

    Yet the platform is adaptable for any group or community, such as charity fundraising drives or parent groups at school that collect money for supplies or field trips.

    Since launch in early 2012, more than 300,000 “campaigns” have been initiated, and the company claims it is launching more new ones per month than any other crowdfunding platform.

    Mobile-payment market set for rapid expansion

  • Can stocks stay aloft with global bond yields crashing?

    Michael Santoli at Yahoo Finance 1 day ago

    Here are a few things to watch during the trading day.

    The world’s scarcest resource right now is safe yield, and the shortage is getting more extreme. Most German government bonds that mature in less than 10 years now have negative yields - part of some $2 trillion worth of paper with yields below zero.

    This is what happens when the European Central Bank begins a trillion-euro bond-buying binge with rates already miniscule.

    Yesterday, ECB boss Mario Draghi – unfazed by the protest stunt at his press conference – reaffirmed his plan to keep bidding for paper that yields more than -0.2% - that's minus 0.2%.

    This is helping to drag US Treasury yields lower as well, with the 10-year down (^TNX) to 1.9% from 2.24% only five weeks ago.

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    Contrasting debuts

    Which would a rational investor prefer to own over the long term?

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  • Has the bottom in oil and energy stocks already come and gone?

    Michael Santoli at Yahoo Finance 2 days ago

    Here are a couple of things to watch during the trading day:

    Did everyone miss the bottom in oil as they debated how much lower it would go and where we’d store all the surplus fuel?

    It’s starting to look that way. And with U.S. crude prices this morning on the verge of ticking positive for the year, we’ll probably hear more about oil and energy stocks being played for an upside trade.

    Naturally, this talk will come with the aid of hindsight, which shows that oil has arguably been forming a stable base for the last three months between about $45 and $55 a barrel.

    Oil and gas exploration stocks – including the SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and bellwethers such as Schlumberger Ltd. (SLB) and EOG Resources (EOG) - are up solidly year to date after being savaged in the back half of 2014.

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  • Is the buyback game played out? Trading China and the banks: What to watch

    Michael Santoli at Yahoo Finance 3 days ago

    Here are three questions to consider during the trading day.

    Number 1:

    Will we see a sudden end to the coddling of shareholders by Corporate America?

    Probably not, but Blackrock Inc. (BLK) CEO Larry Fink is stirring up lots of chatter today with a letter he’s sending to fellow CEOs telling to stop being so friendly to investors by lavishing them with so many dividends and stock buybacks.

    At first look, this seems an odd position to assume for a guy who runs $4 trillion in funds, largely in stocks. But not really, because Blackrock is a long-term owner of equities that must reinvest the cash distributed by companies - in those and other companies.

    He worries that the craze for buybacks and dividend hikes – often prodded by aggressive, short-term focused activist investors – has gone too far and is occurring at the expense of productive investment in businesses that can produce economic growth and wealth over decades.

    Question number 2:

    Question 3:

     

     

  • Time Warner on the back of HBO, MidCaps, new S&P 500 high: What to watch

    Michael Santoli at Yahoo Finance 4 days ago

    Good morning. Here’s what to watch while trading today.

    The market greets the new week at the top of the range. Will the air prove to be too thin up here to sustain the rally - as it has a few times before?

    The S&P 500 (^GSPC) at the 2100 mark is just a few ticks away from another all-time high. But what this really means is that the index has simply shuttled back to the upper end of the fairly tight band of territory that has contained it for nearly six months.

    The upbeat take on this action is that stocks are showing resilience by holding firm against threats from several sides – the oil crash decimating energy stocks, the strong dollar pressuring corporate earnings, another soft patch in the economy weighing on growth estimates. High liquidity and still-strong credit markets have so far frustrated the bears and again compressed market volatility, just as happened in the spring a year ago.

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  • Stocks & VIX in neutral, primed for a jolt from jobs data as Micron beats

    Michael Santoli at Yahoo Finance 15 days ago

    Here’s what to watch in the markets today as a truncated market week ends...

    What would you pay for a business in a stalled economy with sagging profits?

    Use all the fancy charts and quantitative models you like, but that is the core question investors are facing today in U.S. stocks. And based on the choppy, low-conviction character of trading this week and most of this year, the answer is far from clear.

    Like a badly coached NBA team full of complacent veterans, the American economy again ignored the strong game plan and came out lethargic in the first quarter. The Atlanta Fed’s GDPNow index, meant to predict GDP in real time, is now implying zero growth in the U.S. economy for the first quarter, down from 1.9% two months ago.

    Aggregate profits for U.S. companies are forecast to have dropped last quarter for the first period since 2009. Yet cheap money, high liquidity, corporate deals and buybacks have kept things supported not far from all-time highs.

    A neutral state heading into a monthly employment report tomorrow can mean we’re possibly – possibly – about to get some enduring direction to the trading trend.

  • Got a yellow power tie? Why Wall Street is fondly recalling 1986

    Michael Santoli at Yahoo Finance 16 days ago

    Maybe it’s fitting that Hollywood is prepping a “Top Gun” sequel, because Wall Street is busy replaying plot points from the year that movie appeared.

    Even if not too many people now on Wall Street saw the Tom Cruise flyboy flick in its first run through theaters, plenty of investment pros are speaking fondly of the 1986 market and its rough, mostly reassuring, resemblance to today.

    By 1986, the U.S. was a half-decade into a bull market that had followed a devastating recession. The Standard & Poor’s 500 was up 160% from its 1982 low – not too far short of the 200% rise it has enjoyed in the current one, since 2009.

    As the stock market barreled ahead and a corporate debt boom underwrote a buyout binge, several significant economic shifts took place that will seem familiar to investors today:

    - From late 1985 into the first half of 1986, crude-oil prices plunged by more than half, from the high-$20s to $12 per barrel, as Saudi Arabia and close allies flooded the market with supply in a gambit to gain market share against upstart producers.

  • Futures tumble/rebound overnight, Walmart fights suppliers, Micron earnings: What to watch

    Michael Santoli at Yahoo Finance 16 days ago

    Here are three things to keep an eye on during Wednesday's trading session...

    Number 1:

    Was it only a bad dream?

    It’s unlikely our kids will be asking us to tell of the ten-minute overnight stock futures crash of March 31, 2014. But on dealing desks this morning traders are still puzzling over a sudden 1.3% drop in S&P 500 index futures (ESM15.CME) around 9pm Eastern time, on a cluster of fairly heavy selling.

    Most of the instant drop has been recovered, but not because people figured out what it was all about.

    A stray headline about the Iran nuclear talks? A strong China manufacturing number overnight that maybe told some machine to close out bets on heavy Chinese stimulus? Some odd quarter-end rotation trade?

    We don’t know and probably won’t. But if it matters at all, it’s because it reinforces the impression that the market is jumpy, suggestible and in the sway of tactical agendas over short time spans.

    Without endorsing that idea, it helps top know that others feel such points on a chart have a gravitational force.

    Number 2:

    Number 3:

  • Confidence comeback? Bye-bye Q1 & beware world peace: What to watch

    Michael Santoli at Yahoo Finance 17 days ago

    Here are three things to watch during Tuesday's trade...

    Number 1:

    Today marks the conclusion of an inconclusive quarter. The first thing to recognize on the last day of a quarter is that “window dressing” doesn’t really exist.

    This idea that fund managers mechanically lift stocks to flatter their portfolios for their three-month snapshot is nothing more than Wall Street lore and a lazy media trope.

    Does it matter to some professionals that the S&P 500 (^GSPC) needs to fall less than 28 points today to stay positive for a ninth-straight quarter? Maybe it does, but that doesn’t mean it’s so easy to engineer such a result.

    This all reflects the opposing currents of cheap money but a more expensive dollar, sagging but still-high corporate earnings, central bank stimulus abroad and the approach of possible tighter policy here.

    Number 2: