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The Dow Jones Industrial Average rallied yet again on Friday, posting its first eight-day winning streak in over a year, with improving sentiment around U.S.-China trade relations. While Dow closed 37.07 points higher, or 0.1% at 27,219.52, the other indices faced struggles, as the S&P 500 slipped 0.1% to 3,007.39, and he Nasdaq ended the day down 0.2% at 8,176.71. After closing on their highs Tuesday, stock index futures rallied further Wednesday evening after President Trump declared that he would be postponing the planned increase of tariffs on Chinese goods by a little over 2 weeks, as a “gesture of good will.” The tariffs, which are designed to increase to 30% from 25% on about $250 billion worth of Chinese goods, have been a topic of much debate recently.
This article was originally published on ETFTrends.com. With markets once again within less than 1.5% of all time highs, investors are concerned that these lofty levels could be derailed by global and economic events such as a Fed rate cut, or lack of one. One analyst weighs in on CNBC as to how economic data play into the markets and what the upcoming Fed meeting is likely to hold. Producer Pricing Index (PPI) data could weaken some according to Jay Bryson, Wells Fargo acting chief economist, which would reflect an overall decline in industrial production, which the Fed will take into consideration.
Despite the slight downdraft on Monday, technical market analysts, who watch stock charts rather than look at fundamental news, see a chance for stocks to break above previous highs made in July, after the S&P 500 rose above its 50-day moving average last week and crossed above August highs, two signs of positive market strength. After a fall-off in late July and August, the S&P 500 has been mostly positive in September, climbing back to within 1.5% of all-time highs, amid more muted trade war tensions and optimism that there may be more rate cuts on the way. “For the camp that wants to see new all-time highs, they would like to see the S&P 500 to hold 2,940 to 2,955.
There is significant debate among Federal Reserve officials as to whether or not they will cut interest rates at the next meeting this month. Globally there is a strong trend toward zero and negative nominal rates on sovereign debt, which has been proliferating across the euro zone to Japan and beyond. The Fed has fought the trend even though many of its officials have indicated they anticipate that the next economic downturn will see a return to near-zero rates, which former Chairman Alan Greenspan has speculated as well.
This article was originally published on ETFTrends.com. With the global economy stagnating, Brexit looming on the horizon, an ongoing trade war with Beijing, and an economic slowdown from China that has sent reverberations throughout emerging market economies, which have seen a decline in exports, experts are now split on whether or not the Fed should raise interest rates, as they try to gauge the state of the economy. At least one expert believes the Fed should continue its judicious approach to rate cuts, claiming the economy is more robust than many believe. “If the Fed is going to let the market dictate what they’re going to do, they shouldn’t even be on the Fed board.
Inverted yield curves and the U.S.-China trade war are fueling most of the investors’ worries, which could provide more fodder for a global economic slowdown. In 2018 and 2017, the S&P 500 has posted returns of 0.4% and 1.9%, respectively. In 2016, the S&P 500 posted a slight loss.
Market maven Jim Paulsen is brimming with confidence that a breakout will occur before year's end. August's market doldrums are setting up for an equally tepid September, but it will create market opportunities for savvy investors. Just as President Donald Trump announced new tariffs and then scaled back on certain items on the list of Chinese products, the markets were sent on a volatility rollercoaster ride.
This article was originally published on ETFTrends.com. In the Oval Office on Tuesday afternoon, President Trump said, “I think the word recession is a word that’s inappropriate because it’s just a word that certain people, I’m going to be kind, certain people and the media are trying to build up because they would love to see a recession. The Fed should make sure it stays that way,” Cramer explained on CNBC's Mad Money. Cramer expressed that the current positive economic data could look rosy right up until the minute that it doesn't, and that tariffs are a problem for companies other than the big retailers like WATCH: Walmart, Amazon, Target, Costco, and Home Depot, or some of the retail companies that are most key for the economy. “Sure we have the lowest jobless rate since 1969, but you know what, I’m old enough to remember that we had a recession in 1969.
Last Wednesday's brief inverted yield curve came after the U.S. removed some items from list of new China tariffs and the additional duty on other goods is postponed to Dec. 15. “Historically speaking the inversion of that benchmark yield curve measure means that we now must expect a recession anywhere from six-to-18 months from today which will drastically, and negatively, shift our medium-to-longer term outlook on the broader markets,” Tom Essaye, founder of The Sevens Report, said in a note on Wednesday. Then Wednesday the yield curve inverted yet again. Soon after the Fed’s 2 p.m. ET release of its minutes, the curve between the 2-year note and the 10-year note flattened out before briefly inverting again Wednesday afternoon, with the 2-year yield rising above the 10-year yield.
Trade wars will continue to play a hand in the latest market oscillations, but the recent pullbacks could present buy-the-dip opportunities for leveraged exchange-traded funds (ETFs). Just as U.S. President Donald Trump announced new tariffs and then scaled back on certain items on the list of Chinese products, the markets were sent on a volatility rollercoaster ride. Traders can take advantage of these markets movements in the S&P 500.
Trade wars and yield curves are certainly a two-headed dragon that’s been plaguing investors as of late, breathing a heavy fire of volatility all over the capital markets. Traders are betting that this volatility isn’t a temporary scourge and will continue. Traders have been quick to pile in on options contracts targeting the VIX volatility index.
With the capital markets looking for a looming rate cut to boost U.S. equities sometime in 2019, a short-term play could be the forthcoming volatility ahead as Federal Reserve Chairman Jerome Powell testifies before congress this week to apprise lawmakers on the strength of the U.S. economy. As such, traders can take advantage of S&P 500 leveraged exchange-traded funds (ETFs) for short-term gains. Potential leveraged ETF plays in the Direxion Daily S&P500 Bull 3X ETF (SPXL) and the Direxion Daily S&P 500 Bear 3X ETF (SPXS) could have traders placing these ETFs on their watch lists.
With the majority of capital markets looking for a looming rate cut to boost U.S. equities sometime in 2019, it might not be as necessary for a rally as most might think, according to PNC Financial co-chief investment strategist Jeffrey Mills. If the bulls are wrong, of course, it also gives inverse ETF investors a chance to reap gains. SPXL seeks daily investment results of 300% of the daily performance of the S&P 500 Index.
Below is a look at ETFs that currently offer attractive buying opportunities. The ETFs included in this list are rated as buy candidates for two reasons. First, each of these funds is deemed to be in an uptrend based on the fact that its 50-day moving average is above its 200-day moving average, which are popular indicators for gauging long-term and medium-term trends, respectively. Second, each of these ETFs is also trading below its five-day moving average, thereby offering a near-term 'buy on the dip' opportunity, given the longer-term uptrend at hand. Note that this prospects list also features a liquidity screen by excluding ETFs with average trading volumes below the one million shares mark. As always, investors of all experience levels are advised to use stop-loss orders and practice disciplined profit-taking techniques. To get access to all ETFdb.com premium content, sign up for a free 14-day trial to ETFdb.com Pro.
Investor fears of an inverted yield curve have been sending the markets on a volatile ride the past week, but on Friday, those fears eased as the Dow Jones Industrial Average proceeded to gain over 100 points in the early trading session. Fears of a global economic slowdown was compounded by market noise of an inverted yield curve blaring from the bond community. The inversion came after the central bank decided to keep interest rates unchanged last week.
Trading E-mini S&P 500 futures represents a $200 billion market, and some traders are noticing a lack of liquidity, which could put the stock market in a fragile state should a sharp downturn take place. It's something that traders who play in this nuanced market have been picking up on since last year's fourth-quarter volatility that racked the markets and led to massive sell-offs culminating on Christmas Eve. Futures activity tracking the S&P 500 index is typically impacted prior to hitting the stock market.
Despite the Dow Jones Industrial Average looking at its fifth straight losing session last Friday, it’s easy to forget that the bull run in the stock market turned 10 years of age last weekend. The Dow fell 5.6 percent, while the S&P 500 was down 6.2 percent and the Nasdaq Composite declined 4 percent. 2018 marked the worst year for stocks since 2008 and only the second year the Dow and S&P 500 fell in the past decade.
Among the many curveballs the global economy has thrown at investors this year, one of the least expected might be the traction emerging markets have seen in the opening months of the year. Take a look at the year-to-date chart for the Direxion Daily MSCI Emerging Markets Bull 3X Shares (NYSE: EDC) against that of the broad market U.S. equity represented by the Direxion Daily S&P 500 Bull 3X Shares (NYSE: SPXL). Past performance is not indicative of future results.
The U.S. bull market will turn 10 with more room to run. The S&P 500 Index has quadrupled, rallying more than 300%, from the bear-market bottom hit on Mar 9, 2009.
Amid Monday's sell-off, the S&P 500 fellow below 2,800, which could signal the index has hit a key resistance level. Potential leveraged ETF plays in the Direxion Daily S&P500 Bull 3X ETF (SPXL) and the Direxion Daily S&P 500 Bear 3X ETF (SPXS) could have traders placing these ETFs on their watch lists. The S&P 500 opened the session at 2814.37, but closed the session at 2,792.81--down 0.77 percent on the day.
The S&P 500 has rallied 19% from the December low, and is now 5% away from its all-time high. Investors can tap this opportunity by going long on the index with the help of ETFs.
U.S. equities are off to a stellar beginning to 2019 and the volatility that reared its ugly head near the end of 2018 has been missing. It's certainly something investors want to mute since the Dow Jones Industrial Average is up almost 11 percent while the S&P 500 is 10.89 percent higher and the Nasdaq Composite is up 12.83 percent year-to-date. Just recently, the S&P 500 reached a key bullish technical level, moving past its 200-day moving average for the first time since December 3.
Last week, the S&P 500 reached a key bullish technical level, moving past its 200-day moving average for the first time since December 3. The S&P 500 was down 6.2 percent to end 2018, but it has since recovered after U.S. equities were roiled by volatility to close the year. To some technical analysts, breaking through that 200-day moving average paves the way for bigger gains ahead.