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The Federal Open Market Committee’s (FOMC) last policy-setting meeting of this year and November’s retail sales data will take centerstage this week.
Some market participants are starting to contemplate the notion that stellar employment figures could help embolden U.S. trade negotiators in a protracted tariff dispute between the U.S. and China—possibly resulting in a delay if not outright scuttling of a long-sought-after resolution. Indeed, a key report of the week from the Labor Department report showed that the U.S. economy created 266,000 new jobs in November, according to the Labor Department, the biggest gain since January and the unemployment rate slipped to 3.5%, a 50-year low. “This positive number could delay any US/China trade agreement, as signs of a stronger US economy will embolden US negotiators,” wrote Chris Gaffney, president of World Markets at TIAA Bank, in a research note after the nonfarm-payrolls report on Friday.
Delta Air Lines Inc., Chief Executive Officer Ed Bastian says he’d like to offer Wi-Fi free on his airline’s flights but right now it would crash the system.
It has been a tough year for energy investors, with a record number of bankruptcies in the space and its key benchmark underperforming, but there are still plenty of ways for energy investors to profit in 2020
Expectations are running high for a preliminary U.S.-China trade pact before more tariffs are levied against Beijing next week, but plenty of other factors in December will keep investors on the edge of their seats.
Founder Richard Schulze accounted for the bulk of the selling, although Mike Mohan, president and chief operating officer, also unloaded a significant amount of Best Buy stock.
Stover and Noble Energy director Scott Urban recently scooped up shares of the energy explorer in the first insider stock buys in nearly two years.
Cheap funds that tracked the US stock market over the past decade outperformed the 60 leading US university endowments, a group of sophisticated institutions that have championed more costly alternative strategies as a way to enhance returns. Many US universities have followed the example of Yale, whose chief investment officer David Swensen and senior director Dean Takahashi helped pioneer the “endowment model” where private equity managers and hedge funds play a larger role in an investment portfolio. Several other institutional investors globally have drawn inspiration from the endowment model of US universities and raised their allocations to alternative assets to boost returns.
Momentum has been the sweet spot for much of this bull market. Since the start of 2014, momentum stocks in the Russell 1000 index (RUI) are up 187% compared to 166% for the index, according to T. Rowe Price chief investment officer John Linehan.
The stock market’s closing bell typically rings at 4 p.m. Eastern, but for traders sniffing around for a broad-market strategy that’s proven to be a real winner in recent years, perhaps that sound should be treated as an opening bell.
Especially long bull markets aren’t always followed by especially long or severe bear markets. If “the higher they go, the harder they fall” were true, then an exceptionally severe bear market is indeed in our future. Notwithstanding the current narrative that the bull market is 11 years old, it actually is much younger: less than four years old, in fact.
Apple, the stock with the largest market capitalization within the S&P 500, is a better bet than the stock with the smallest, TripAdvisor. With a market cap of over $1 trillion, Apple (AAPL) has more than 320 times the portfolio weighting in the S&P 500 index (SPX) than TripAdvisor (TRIP) whose market cap is $113 million. Wouldn’t the S&P 500 index be improved if it gave equal weight to all 500 stocks?
According to a recent study from the EWG, “the richest of the rich” — the top 1% — received 13% of the federal payments, or more than $177,000 each. The bottom 80%, on the other hand, go an average payment of $5,136.
Buy and hold... and forget. Time in the market, not timing the market. Anybody who’s ever contributed to a retirement account has probably heard the tried-and-true approach Wall Street pros have been peddling for decades. But one financial planner explains what’s wrong with that advice.
Last year was an exception when the stock market plunged in December. • The left-most point on the chart shows a rise, similar to the one happening now, in the stock market. • The right-most point shown on the chart is for the current stock market.
Keep your money close when Wall Street and surging stock prices tempt you to buy, writes Michael Sincere.
According to a recent National Association for Business Economics survey, 72% of economists expect a recession by the end of 2021. That percentage appears to be much higher among some of Goldman Sachs’s deepest-pocketed customers.
The U.S. stock market has been setting new records and the economy is in a record eleventh year of expansion, so one research firm thinks a recession is due in the next two years. What that means for stocks, precisely, is a little less clear.
Demand for short-term funding from the Federal Reserve is still running high ahead of the typical year-end cash crunch, even as the central bank has poured more than $320 billion into financial markets to keep credit flowing.
Steven Gidumal, managing partner of Virtus Capital, says the fate of this relentless bull market hangs on what happens in the upcoming 2020 presidential election.
Price action, internal momentum and volume aren’t great, but that doesn’t matter when the president wields his baton.
U.S. stocks close sharply higher Friday after employment report for November beat expectations, while investors remain optimistic about the chances of a U.S.-China trade deal.
(Bloomberg) -- You know something strange is going on when the stock market’s most reliable optimists sound like cranks.Wall Street strategists have been thrust into just such a role at the end of 2019, as this year’s stunning recovery in the S&P 500 pushed it hundreds of points above where they thought it would be. So hot have stocks gotten that professional prognosticators are having a hard time mustering much optimism for next year.Which is unusual, for them. A reliable tradition on Wall Street is the propensity of stock strategists -- as a group -- to predict the same thing over and over. Since 2009, they’ve rarely wavered from a script in which they say the S&P 500 will rise about 10% in the coming year. Right now, they see half that.“We see the market already pricing in a strong rebound in macro and earnings growth, back up to the peaks of this cycle, much stronger than we expect,” said Binky Chadha, chief global strategist at Deutsche Bank. Chadha saw the S&P 500 rising to 3,250 this year -- the highest of anyone tracked by Bloomberg -- and expects it to stay there at the end of 2020.The index closed Friday at 3,146, up 25% year to date.Together, professional forecasters are giving the least optimistic annual outlook in more than a decade. Their average call is for the S&P 500 to end next year at 3,280, going by 17 estimates compiled by Bloomberg. As it stands now, that represents a 4.3% expected increase, the smallest for any year since 2004.A few things are influencing the muted tone. One, strategists failed to anticipate the magnitude of this year’s recovery, which as of Friday had driven the S&P 500 up 34% from its December 2018 low. The market’s latest leg up keeps narrowing the size of the advance they see in 2020. In addition, strategists remain concerned about the relatively anemic earnings growth upon which this year’s rally is based. Virtually all of this year’s gains are the result of fattening valuations, a trend they don’t see continuing.Big misses when stocks rally are a predictable outcome for strategists, who over the past two decades have forecast gains in U.S. stocks that average out to 9.5%. While that may seem lemming-like, it’s an acknowledgment of the market’s general tendency over time. The annualized gain in the S&P 500 is 9.4% since its inception.Strategists have also never called for a down year in the period Bloomberg has tracked them. Still, their 2020 forecast marks a notable step down. Betting on a repeat of 2019 would be a mistake, they warn, highlighting event risks such as next year’s U.S. presidential elections and a re-escalation of trade tensions.At least three strategists expect the S&P 500 to be lower a year from now. Mike Wilson at Morgan Stanley and Francois Trahan at UBS Group AG have both set a year-end target of 3,000, while Sophie Huynh at Societe Generale has 3,050.On the bull side is Jonathan Golub at Credit Suisse, whose 3,425 target is by far the highest among those tracked by Bloomberg. Citing an improving earnings outlook and relatively attractive valuations, Golub says it’s too early to bail even with the record-long bull market heading toward its 12th year.At 17.8 times forecast profits, the S&P 500 traded at a multiple that’s higher than any time since the dot-com era, except for a few months in late 2017 and early 2018, data compiled by Bloomberg show. Still, with the Federal Reserve in an easing mode and Treasury yields hovering near record lows, stocks can hardly be framed as excessively over-valued.“The S&P 500 valuations don’t necessarily start off as inexpensive as” markets like Europe, said Sean Darby, global equity strategist at Jefferies whose target is 3,300. “But the cyclicals offer a lot of earnings upside if the global economy begins to resynchronize.”Strategists have forecast annual gains of 5% or less three times before. In 2014 and 2017, they ended up under-shooting by at least 7 percentage points. In 2005, they were right on target.“It’s important to understand what the consensus is,” Dan Veru, chief investment officer at Palisade Capital Management, said by phone “Expectations are very low. I always want to take the other side of that.”To contact the reporter on this story: Lu Wang in New York at email@example.comTo contact the editor responsible for this story: Jeremy Herron at firstname.lastname@example.orgFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.