Posts by Pras Subramanian
- Pras Subramanian at Breakout2 days ago
If you’re invested in this market, you may feel like 2014 has been one long ride on a Six Flags roller coaster. Although the S&P 500 (^GSPC) is flat for the year, it’s been one bumpy ride getting here.
Over the past five years, however, investors have had very little to complain about. A steady, upward climbing market with little volatility had 401Ks and IRA accounts humming nicely. But one group of investors missed out on the action: young investors, or millennials.
After 5 years of steady returns, the return of volatility is now likely to dissuade new investors from buying in. Nick Colas of ConvergEX thinks that would be a mistake.
“This is year is a lot more normal, it’s a lot more like what should be expected,” he says in the attached video. “We get volatility, we get pullbacks closer to 5%, we’ll still be OK for the year, but the volatility will be much higher than last year.”
Colas says the same problems, or fears, affect everyone from mom and pop, to Wall Street whales, and new college grads looking to buy an ETF.
- Pras Subramanian at Breakout3 days ago
Another strong day for the market (^GSPC) yesterday has traders in better spirits after an ominous start to the week. Bullish comments by Janet Yellen on Wednesday helped, but one can’t help but feel we’re still in uncharted territory, with most market veterans seemingly grasping at straws to determine where we are in terms of the current bull market.
Many believe we are in the midst of an ongoing bull. Paul Schatz of Heritage Capital is one of these prognosticators, but senses our current bull market is getting close to be sent out to pasture. “The Bull market is old, and it’s wrinkly, but it’s not over yet,” Schatz opines in the attached video. “The bull market is transitioning to its final phase which is normal, bull markets don’t last forever.”
With that in mind, there are 3 sectors Schatz likes as the current bull market heads off into the sunset.
- Pras Subramanian at Breakout5 days ago
“These aren't the drones that you're looking for…” or so one imagines Larry Page and Sergey Brin whispering into the ears of Facebook (FB) founder and CEO Mark Zuckerberg. Google (GOOG) confirmed on Monday that it had swooped in and acquired drone-maker Titan Aerospace, a company Facebook was reportedly interested in acquiring.
Although Facebook ended up buying U.K. based drone start-up Ascenta, the turf war for drone supremacy is just taking off. Led by their visionary founders, both tech giants are taking to the skies to plant their company’s flags. It’s all about reaching an estimated five billion people worldwide who need access to the Internet, and thus capturing more information and getting in front of ever more eyeballs.
Access and Information
- Pras Subramanian at Breakout5 days ago
Phew! That was investors rubbing the sweat off their collective brows after Monday’s welcome relief rally, with the Dow (^DJI) gaining nearly 1%, and the S&P 500 (^GSPC) gaining back 0.8%. After a volatile and downright painful in some respect trading week, stocks have caught a bit as better than expected retail news and possibly cheaper, high-quality stocks have brought investors back into the fold.
But don’t tell the permabears that. The “I told you so” crowd has been beating their chests as off late, with Barron’s joining the chorus with their latest cover story on overvalued tech names.
Trader and hedge fund founder Jonathan Hoenig of Capitalistpig.com has a bit of advice for investors who might be swayed by the permabears. “No one knows what will happen in the market… We haven’t even had a 10% selloff in the major indices, so I’m trying to stick with technique more than prognostication.”
- Pras Subramanian at Breakout11 days ago
The Fab Five, as my colleague Phil Pearlman calls them,have been more like the ‘Filthy Five’ for investors. Netflix (NFLX), Facebook (FB), Tesla (TSLA), Priceline (PCLN) and Google (GOOG) have been shellacked in the past month, with some in fact entering bear markets (down over 20%).
- Pras Subramanian at Breakout13 days ago
First we had the Hang Seng China Enterprises Index, then 2013’s big star the Nikkei (^N225) got hit. Bear markets are creeping up in global markets, and even among some indivisual high flyers in U.S. like Netflix (NFLX), Facebook (FB) and Priceline (PCLN). While indices that track larger companies like the S&P 500 (^GSPC) is doing much better than high-flying momentum stocks after hitting all-time highs last Friday, our friends from Bespoke are finding that the average stock in the S&P 1500 (which includes small-caps and mi-caps into the mix) is down an average of 12.8%.
- Pras Subramanian at Breakout16 days ago
Has a longtime Minnesota bull turned bearish? Jim Paulsen, Chief investment strategist at Wells Capital Management, came out with a peculiar research note earlier in the week. Paulsen highlighted some similarities with an S&P 500 (^GSPC) chart from our current bull market with one that shows a similarity to the 1982 bull market that culminated int the Black Monday crash in 1987:
the contemporary bull market has been following the 1982 bull market fairly closely. As recently as last year-end, both bulls were up about 175% from their respective bear market lows! The important anniversary passed just a couple days ago was the 1274th trading day of both bull markets – the day on 8/25/1987 when the 1982 bull market reached a notable peak. On that day, the S&P 500 Index peaked for the year at 336.77. Moreover, we are now just 37 trading days from another important anniversary in financial history – 10/19/1987 when the S&P 500 Index suffered its biggest single day collapse ever!
- Pras Subramanian at Breakout19 days ago
The Obamacare individual signup deadline came and went yesterday, and not without a whimper. In yet another setback, the healthcare.gov portal was down again after a rush of last minute visitors tried to sign up on deadline day, knocking the exchange outon two separate occassions. Despite the hiccups, the administration claimed nearly 7 million signees, topping the target of six million in six months the White House had established. To be fair, the six million target was scaled back from seven million a few months ago.
- Pras Subramanian at Breakout23 days ago
It’s pretty well known on Main Street, but seems to be relatively ignored by Wall Street. Zillow (Z), the largest U.S. real estate website, has reported staggering revenue growth over the past few years and operates in a space that almost everyone needs info from at one point or another, but hasn’t seen the love that other, "sexier" tech stocks saw earlier this year.
Perhaps that’s a good thing. Despite the absolute beat down of many momentum stocks earlier this month, Zillow has been more resilient, notes Joe Fahmy of Zor Capital. “Zillow held in very well, and had its biggest volume accumulation week the week ending March 21 st , showing institutions are actually accumulating the stock while other momentum high growth players are getting hit.”
But it’s not just a real estate play. Zillow is “getting into mortgages,” Fahmy notes, in addition to it being a software play and mobile play. There’s also a social aspect with Zillow’s Yelp–like ratings system.
- Pras Subramanian at Breakout1 mth ago
China’s benchmark Hang Seng index wasn’t having the best stretch since late last year, but Janet Yellen’s comments that a tightening of rates could come sooner rather than later did not sit well in the Far East. Chinese stocks dropped nearly 2%, sending the Hang Seng index into the dreaded bear market since it is now down 20% since December 2nd.
U.S. stocks are faring better today, but ripples abroad do tend to make waves, eventually. “You are interested in the Chinese market,” says Jon Najarian, co-founder of optionMONSTER in the attached video. “Over the last week or so, Chinese internet stocks are down 15 to 20%, some of them that much in a day. So that’s been a real area of concern,” he says, and rightfully so. “The revenue that they were generating…that was already accounted for, and the numbers were still so bad.”