|Bid||149.97 x 3200|
|Ask||149.99 x 4000|
|Day's Range||149.14 - 151.07|
|52 Week Range||125.81 - 173.39|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||1.20|
|Expense Ratio (net)||0.19%|
Small-cap stocks, as represented by the iShares Russell 2000 ETF(NYSEARCA:IWM), much like the rest of risk assets, tumbled or "mean-reverted" over the past few trading sessions. Although in the immediate term they're somewhat oversold, through the September/October period, I could see plenty more downside for the IWM ETF that bears could take advantage of.Source: Shutterstock Last week on Aug. 1, I offered the idea to short the S&P 500 via the SPDR S&P 500 ETF (NYSEARCA:SPY). This trade has done well so far and some near-term profit taking is likely in order. Personally, I am now preparing to switch my SPY short into a short position in the Russell 2000 ETF for the reasons laid out below. IWM ETF Charts Click to EnlargeInvestorPlace - Stock Market News, Stock Advice & Trading TipsFirstly, looking at the multi-year chart with weekly increments is crucial to gain proper perspective where any given asset is trading in the bigger picture.On this chart, we see that for the most part, the IWM ETF through the past ten years ascended in a well-defined range. From November 2017 into September 2018, this index had several overshooting attempts out of this range; however, these proved to be short-lived as mean-reversion is a powerful reality in markets.Indeed this overshooting then led to a sharp selloff in Q4 2018, as the IWM ETF traded all the way down to the lower end of the longer-standing uptrend. * 10 Stocks to Buy on the Trade War Dip In Q1 2019, the Russell 2000 ETF had a sharp rebound along with the broader market, which again pushed it to the upper end of said range. Since then, the choppy market favors another test of the lower end of range in the not too distant future. Click to EnlargeThe relative chart -- the ratio chart of the IWM ETF divided by the SPY ETF -- shows the relentless relative weakness of small-cap stocks versus large-cap stocks since the summer of 2018 (for the past twelve months or so). This pervasive trend has yet to change … and in this case, "the trend is our friend." Click to EnlargeLastly, on the daily chart, we see that another way to draw lines on the chart is by handicapping the March, present-day trading range (red lines).The selling of recent days now has the IWM ETF at the lower end of this range but only in the middle of the bigger-picture range (black diagonals). If the broader market sees another leg lower in the coming weeks, which is my base case, then more downside toward the lower end of the big-picture range should also be in store for the Russell 2000.As such, I suggest shorting the IWM ETF in the $150 - $152 area with a downside target of $135, and a stop loss at $157.Get FREE ACCESS to Serge's renowned Stock Market Scanner with actionable trade ideas. Get it HERE. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on the Trade War Dip * The 5 Highest-Rated Dow Stocks Right Now * 4 Cybersecurity Stocks to Buy for Long-Term Gains The post Trade of the Day: It's Not Too Late to Short the Russell 2000 (IWM) ETF appeared first on InvestorPlace.
"Game of Thrones" had "winter is coming." The market should have "August is coming." You knew August could get rough if you listened to what I said on July 21, when I told you that August would bring lower prices and choppy markets:Don't get alarmed, but know this: We are in a strong market, trading at highs with nearly all buy signals.
As the broad stock market and many other corners felt the pain of the proposed tariff, it triggered a flight to safety. Given this, investors should stash their cash in some safe investing zones.
What happened in the stock market today? Stocks traded near flat throughout most of the session, as investors continue to digest earnings results and awaited the Fed's announcement at 2:00 p.m. ET.Late late week, no one seemed to care about the Fed given the slew of earnings reports. Even Tuesday, it didn't seem to draw much interest, with Apple (NASDAQ:AAPL), Advanced Micro Devices (NASDAQ:AMD) and others on the calendar of quarterly results.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut on Wednesday, the Fed mattered. What Did the Fed Do Now?Last September, the Fed raised interest rates, indicated another rate hike in December and talked about a series of rate hikes in 2019. That blew up in the Fed's face, with equity markets falling about 20% from peak to trough in less than three months. * The 10 Best Stocks to Invest in for August That changed the course of Fed policy, as it cut rates today for the first time in more than a decade.Markets were largely pricing in a 25 basis point rate cut, which is exactly what the Fed gave us. More so, the Fed ended its balance sheet reduction two months early and used the term "accommodative" in its announcement. To any long-time observer, that implies more rate cuts in the future -- which is a good thing considering that markets are pricing in another cut in September -- and a more dovish stance overall.That's what makes this whole reaction one big "oof."The Fed didn't come out wildly dovish, but it was a more dovish stance than the market appeared to anticipate. So why the selloff? Because Fed chairman Jerome Powell seemingly refuses to get some much-needed Q&A coaching.After these types of Fed announcements, the chairman is called upon for a Q&A session. Routinely, Powell fumbles through these sessions and seems to contradict both himself and the Fed statement at times. It leads to confusion, frustration and uncertainty.When those sentiments are injected into the market, we get volatility. So it wasn't so much what the Fed did that tripped up investors, it's how they said it in the follow up. Looking Forward Click to EnlargeThe announcement sent a shiver through markets, even though the losses looked minor. The SPDR S&P 500 ETF (NYSEARCA:SPY) fell 1.09%, the PowerShares QQQ ETF (NASDAQ:QQQ) fell 1.38% and the iShares Russell 2000 ETF (NYSEARCA:IWM) fell 0.81%. Both the SPY and the QQQ are holding onto their major breakout levels, at $295 and $191, respectively. On the flip side, both ETFs fell below their 20-day moving averages for the first time in almost two months. Investors are left with two choices now: Either hold those breakout levels and reclaim the 20-day moving averages or continue lower and test the 50-day moving average. Click to EnlargeIf not for the Fed injecting added volatility into the market, I would think the latter is more likely than the former. However, with investors selling first and asking questions later, a 50-day test wouldn't be all that surprising. Let's see how stocks trade on Thursday and Friday to get a better feel. Movers in the Stock Market TodayApple was a big focus on the day, with the company beating on earnings and revenue estimates for its fiscal third quarter. Further, revenue guidance of $61 billion to $64 billion came in well ahead of consensus expectations for $60.9 billion in sales.That gave a jolt to the stock, which initially rallied north of $220 in morning trade. The action is reminiscent of last quarter. Apple delivered a solid result with better-than-expected guidance. A trade-related Twitter tirade from President Trump sent stocks reeling soon after though, as the market began a steady and painful decline for the month of May.Again, Apple's post-earnings results are being soured by an outside catalyst, although hopefully August won't be as bad as May. On the plus side, Apple finished higher by 2% on the day.Another bright spot was Nordstrom (NYSE:JWN), which jumped 7.9% on reports that the Nordstrom family is looking to increase its stake. Currently owning roughly one-third of the company, reports suggest the family wants to eclipse the 50% mark. Remember, the board rejected the family's go-private offer at $50 per share last year. After opening the day under $31, one could say the board made a mistake in that day.General Electric (NYSE:GE) ended the day mixed, falling 67 basis points after the company beat on earnings and reported in-line revenue. The company also raised its earnings guidance and looks more optimistic on free cash flow. The stock looked set to rally, but stumbled in morning trading as investors still have some reservations. * 5 Top Stock Trades for Thursday: GE, GILD, SPOT, EA If buyers do come flocking to it, here's the new trade setup.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy With Over 20% Upside From Current Levels * The 10 Best Stocks to Invest in for August * 6 Upcoming IPOs for August The post Stock Market Today: Fed Cuts Rates, But Stocks Sell Off appeared first on InvestorPlace.
We saw more defensive action in the stock market today, with all three major moving averages tiptoeing lower. That comes with the Fed's midday announcement on Wednesday and as President Trump complained on Twitter about China's poor faith trade-negotiation tendencies. On Monday, we said it wouldn't be too surprising to see this type of defensive action given the busy week. Bonds, gold, the VIX and others were again on the move higher Tuesday. Perhaps a bit surprising was the rally we saw in the Russell, with the iShares Russell 2000 ETF (NYSEARCA:IWM) rallying 1.79%. InvestorPlace - Stock Market News, Stock Advice & Trading TipsTo be clear, it's not as if the SPDR S&P 500 ETF (NYSEARCA:SPY) or the PowerShares QQQ ETF (NASDAQ:QQQ) were hammered, each falling just 0.25% and 0.43%. However, those indices could be moving largely in one direction following earnings from one of the market's largest companies: Apple (NASDAQ:AAPL). Earnings and Fed to ComeApple reports quarterly results after the close on Tuesday. AAPL stock has been doing pretty well as of late, slowly but surely grinding its way higher. It's almost back to its post-earnings levels from last quarter. This leaves investors in a tough spot, as they try to determine how the stock will trade in what is typically Apple's slowest quarter. * 7 Stocks to Buy With Over 20% Upside From Current Levels Most investors will be focused on what Apple management sees going into the second half of the year and how the situation in China is impacting both revenue and earnings. Analysts keep issuing bullish reports on Apple, pointing out that Street estimates seem too low. That's ironic, because as these reports surface, it seemingly elevates expectations. So we'll see how Apple does in a few hours. Click to EnlargeConsensus estimates call for earnings of $2.10 per share on revenue of $53.4 billion. That $2.10 EPS estimates has been steady for the past couple of months and has increased slightly from $2.07 90 days ago. For revenue, it's about at the midpoint of management's prior outlook, which was for $52.5 billion to $54.5 billion. Two of the most important metrics will be iPhone revenue and Services revenue. Consensus expectations are calling for $26.31 billion and $11.68 billion in sales, respectively. The report may also move recent large-cap names involved with Apple, specifically Intel (NASDAQ:INTC) and Qualcomm (NASDAQ:QCOM). Apple's not the only one reporting, With Advanced Micro Devices (NASDAQ:AMD) set to report after the close too. Analysts expect earnings of 8 cents per share on revenue of $1.52 billion. Q3 sales estimates stand at $1.22 billion, as guidance will be key to the stock's price action. As for the Fed, investors are pricing in a 78.1% chance of a 25 basis point cut and a 21.9% chance of a 50 basis point cut. Note: the market is not pricing in a no-cut scenario. Movers on the Stock Market TodayBeyond Meat (NYSE:BYND) was moving quite a bit Tuesday after reporting earnings. After falling as much as 17.3%, the stock erased almost all of its losses in the first few hours of trading. Those intraday gains couldn't stick though, with BYND falling 12.3% on Tuesday. The results come after a better-than-expected revenue figure, but a miss on earnings. Further, the company is offering 3.25 million shares in a secondary. While most would consider that a savvy business move, it rubbed a lot of investors the wrong way when they realized 3 million shares were part of an early lockup expiration, with just 250,000 shares being sold to help the business. While Procter & Gamble (NYSE:PG) isn't up almost 700% on the year like BYND, it's done well. Shares are up over 30% in 2019 and up about 50% over the past 12 months. Tuesday morning's fiscal Q4 earnings results are only helping to fuel those gains. The company beat on earnings per share and revenue expectations, but those are small potatoes compared to PG's other impressive metrics. Organic sales exploded 7%, easily besting expectations of 4% and were the company's best result in more than 10 years. Further, management plans to buyback $8 billion worth of stock in the coming year. Finally, full-year earnings guidance came in ahead of consensus views and margins increased. In short, it was a great quarter. Finally, Capital One Financial (NYSE:COF) was under pressure, falling 5.9% as a late-session rally helped give it a boost. The company disclosed a data breach affecting more than 100 million people throughout the U.S. and Canada. * 10 Companies I'd Love to See Go Public According to the company, the breach was "perpetrated by a former employee of Amazon Web Services, where the bank had stored its customer data." COF says it will cost the company $100 million to $150 million and the Senate Banking Committee has already begun its probe. Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Small-Cap Stocks to Buy Before They Grow Up * 7 Stocks to Buy With Over 20% Upside From Current Levels * 7 Marijuana Penny Stocks to Consider for Those Who Can Handle Risk The post Stock Market Today: All Eyes on Apple Earnings appeared first on InvestorPlace.
U.S. GDP growth slows in the second quarter but trumps expectations, indicating still-decent operating environment. This could bode well for these ETF areas.
While the more widely observed U.S. benchmarks have marked new record highs, small-cap stocks and related exchange traded funds have fallen behind and underperformed. The iShares Russell 2000 ETF (NYSEArca: ...