Markets Fight Back

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

The Dow broke a five-session losing streak today as it reversed a nearly 170-point loss and turned positive despite growing angst related to next week’s “Brexit” vote in the U.K. Rising confusion over Fed policy and sagging economic growth around the globe has investors a bit in a state of shock to say the least.

Polls are showing that the odds of a Britain exit from the EU are rising and have caught global investors somewhat by surprise given that, just a few weeks ago, the majority of them did not anticipate an exit as a real possibility. Thus, money continues to flow into the perceived safety of government bonds around the globe, like 10-year German government bonds. The yield on the 10-year German government bond today hit a new record-low yield of -0.033% and the yield on the 10-year U.S. Treasury note slid to 1.57%, which pushes it further into territory last seen in late 2012.

Another day of falling prices in the oil added to the confusion regarding the global economy. A barrel of U.S. Crude lost a whopping 4.29% to close at $45.95 a barrel after topping the $52 per barrel mark just last week.

Go figure…

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The Fed Blinks: Holds Rate Hike At Bay

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Despite talking out of both sides of its mouth for weeks, the Federal Reserve announced at the close of its meeting today that it would keep interest rates unchanged. While commenting on the matter though, Yellen said a July hike “is not impossible,” suggesting that strong job growth in June and substantial upward revisions of May’s feeble gains could embolden the Fed to act soon. Sure, we’ve heard this same song for a long time.

One commodity though that has been basking in the sun of rate hike stalls is Gold.

Gold hit a six-week high today, climbing for the sixth straight session after the Fed lowered its economic growth forecasts through 2017. The metal is highly sensitive to U.S. interest rates, increases in which lift the opportunity cost of holding non-yielding gold and boost the dollar, upon which gold is priced.Yesterday, holdings in the SPDR Gold Trust (GLD), the world’s largest gold-backed exchange-traded fund, rose to its highest level since October 2013 and there are no signs of it slowing down.

The economy, meanwhile, has sloshing along after notching meager growth the past two quarters. Consumer spending, which makes up 70% of economic activity, has picked up a tad and while the housing recovery has gained steam, signs of a top appear on the horizon. Exports and business investment remain feeble because of weakness abroad, a strong dollar and the oil industry downturn.
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Fourth Straight Loss For Domestic Indexes

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks extended their decline today as the Fed began its two-day policy meeting. The general sentiment is that rates are going to be hiked anytime soon, so that potential announcement is fairly well baked into prices throughout the market at this point; that’s the official version. Personally, when looking at the consistently deteriorating economic data points, it would seem to me that the Fed should be closer to cutting rather than hiking rates.

Be that as it may, Wall Street is curious as to what the Fed will say on Wednesday regarding the state of the economy and interest rates. However, the larger concern for investors around the globe is Britain’s referendum next week regarding whether or not they will stay in the European Union.

Many feel that if Britain does leave the EU that trade and investment would suffer, triggering a recession, hurting jobs, slamming the pound and causing house prices to fall, all of which is the scare mongering version of the government to keep the Brits aligned with establishment thinking. David Cameron is campaigning for Britain to stay in the bloc, but his Conservative party (and government) is bitterly divided over the issue.

And in wholesale news, Costco (COST) will begin accepting Visa cards on June 20th, officially ending the reign of American Express (AXP) dominance in the bulk retail giant. Citigroup (C) will be the issuer of Costco specific credit cards and it will be interesting to see how the stock responds. It currently stands at $155.87, which is $10 shy of its all-time high.

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Nervous Monday: Markets Retreat

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Wall Street was a mess today after the shooting in Florida this past Sunday morning. This unfortunate incident, alongside uncertainty ahead of the U.S. Federal Reserve’s meeting this week and on mounting concern about Britain’s possible exit from the European Union did not equate to a prosperous trading day in the market worldwide. Stocks in Asia and Europe tumbled as well.

Amongst the chaotic trading behavior on Wall Street today was news regarding a potential buyout deal with Microsoft and targeted LinkedIn. The word on the street is that Microsoft (MSFT) has made a bid $26.2 bil bid to buyout LinkedIn (LNKD). Shares of the social networking site soared 47% as the $196-a-share offer represents a nearly 50% premium over its Friday closing price of $131.08. Perhaps the buyout push is an effort to make up for Microsoft’s failing smart phone production efforts and their recent sell-off of Nokia.

The Fed begins a two-day meeting tomorrow and the general consensus is that the central bank will hold off on raising interest rates for the time being. Still, investors are anxious to hear how policymakers view the state of the economy here in the U.S. and if any hints will arise about what they might do with rate hikes at future meetings.

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One Man’s Opinion: Is The Fed Outright Buying Stocks/Futures To Prop Up The Markets?

Ulli Market Review Contact

Man

By Phoenix Capital Research

“Someone” is getting desperate.

Throughout the last week, anytime stocks have begun to correct or drop, “someone” has bought S&P 500 futures to prop the market up.

Anyone who’s been involved with the markets for a while knows the difference between real buyers and manipulation. This is manipulation plain and simple.

Look at all those “V” rallies. Three days in a row stocks opened DOWN and someone immediately stepped in and began buying aggressively.

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ETFs/Mutual Funds On The Cutline – Updated Through 06/10/2016

Ulli ETFs on the Cutline Contact

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 381 ETFs, of which currently 324 (last week 344) are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher. Volume figures can change in a hurry, so be sure to check first before investing.

These ETFs are generated from my selected list of 98 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 79 ETFs (last week 86) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 542 (last week 588) above the line and 238 below it out of the 780 that I follow.

Take a look:

  1. ETF Master Cutline Report
  2. ETF High Volume Cutline Report
  3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.