Underwhelming Earnings

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

U.S. stocks retreated today as investors brace for a barrage of earnings reports, a slew of fresh economic data and the Federal Reserve’s decision Wednesday on interest rates.

The earnings season, according to MSM, has fared well thus far, if you can call beating a bar that has been set extremely low a news-worthy event. Nevertheless, 77% of the 132 companies that have reported earnings have topped these basement expectations. There is no major signal in this earnings season though and investors are still waiting for a confirmation that earnings will increase in the future. Well, I won’t hold my breath for that announcement.

The Fed breaks from its two-day policy meeting Wednesday at 2 p.m. ET and investors around the globe will be watching to see what the U.S. central bank says about the timing of its next interest rate hike. My guess: It won’t happen….

Costco was back in the headlines today, after buzz that annual memberships may increase from $5-10 per member in 2017. The trend has been for the company to raise membership fees every 5-6 years and the last time that fees were raised was back in 2011.  Fees for a Basic Membership are $55 and $110 for Executive Memberships.

In oil news, the prince of Saudi Arabia has laid out a sweeping plan to transform the kingdom from its heavy reliance on oil to a more diverse economy. Among other proposals to boost non-oil revenue, the leader said today that they should invest more in mineral mining and expand the kingdom’s military production. The future impact on oil prices is still TBD.

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ETFs/Mutual Funds On The Cutline – Updated Through 04/22/2016

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 330 (last week 283) 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. 83 ETFs (last week 67) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 433 (last week 350) above the line and 347 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.

One Man’s Opinion: “I’m Not Really Sure How Much More Of This I Can Take”

Ulli Market Review Contact

Submitted by Albert Edwards via ZeroHedge

Man

Earlier this week we described the personal come to non-GAAP Jesus moment of trading commentator Richard Breslow, who confessed in no uncertain terms that he has had it with endless central banking intervention: “a portfolio built to only withstand stress thanks to central bank intervention is one destined to blow-up spectacularly. The embedded flaw in this new logic is that central banks give investors perfect foresight. And nothing can go wrong… You don’t need to be a Taleb or Mandelbrot to calculate that we have been having once in a hundred year events on a regular basis for the last thirty years.”

Today it is another famous skeptic, SocGen’s Albert Edwards who has had enough and says he feels “utterly depressed” because he has not “one scintilla of doubt that these central bankers will destroy the enfeebled world economy with their clumsy interventions and that political chaos will be the ugly result. The only people who will benefit are not investors, but anarchists who will embrace with delight the resulting chaos these policies will bring!”

As he openly warns his readers:

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New ETFs On The Block: Principal Shareholder Yield Index ETF (PY)

Ulli Uncategorized Contact

InvestingPrincipal Financial, the Iowa-based retirement and mutual funds specialist, recently expanded its exchange-traded fund offerings with the launch of two new so-called smart-beta funds. Principal is one of the biggest asset managers in the US, yet it was largely missing from the ETF landscape with just one actively-managed product to its name.

The Principal Shareholder Yield Index ETF (PY) targets US companies that return value to shareholders. The passively managed PY tries to reflect the performance of the Nasdaq US Shareholder Yield Index, which in turn, is a subset of mid– and large capitalization US companies within the broader Nasdaq US Large Mid Cap Index. Shareholder yield is a measure that quantifies the amount of cash returned to shareholders through buybacks, dividends and debt reduction.

The three components of the so-called ‘shareholder yield’ is a good metric of shareholder friendliness and the new fund is the only product that targets all the three factors. Most funds focus on one component, such as buybacks or dividends, but not both. PY’s investment strategy helps investors target companies that have the ability to support share prices through buybacks and have a history of dividend growth and debt reduction.

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ETF/No Load Fund Tracker Newsletter For April 22, 2016

Ulli ETF Tracker Contact

ETF/No Load Fund Tracker StatSheet

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https://theetfbully.com/2016/04/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-04212016/

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Market Commentary

MIXED END TO MIXED WEEK

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

U.S. stocks closed the week mixed Friday as earnings misses last night from Microsoft (MSFT) and Google parent Alphabet (GOOG) gave Wall Street’s optimism a punch in the face. Before the opening bell though, the Dow got a push from strong earnings report from McDonald’s (MCD).

The mediocre finish to the end of the week on Wall Street has some investment pros wondering if the market’s strong run from the lows in early February has run its course while worrying about the recurring theme of the past that April cheers could bring May tears.

We heard a solid earnings report from McDonald’s (MCD) today. The maker of burgers, fries, and breakfast meals posted an earnings beat and rise in same-store sales of 5.4% versus a year ago, boosted by the success of its all-day breakfast initiative.

Despite the market’s two-day relapse, the earnings situation has improved, if you can call it that. With 132 companies in the S&P 500 having reported earnings, the Q1 profit contraction has been decreased to “only” -7.1%, which is better than the nearly -8% estimated drop a few weeks ago. Sure, that should push the major indexes to new highs in a hurry.

Let’s see how the next week of earnings reports will impact markets.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 04/21/2016

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, April 21, 2016

TOC040716

If you are not familiar with some of the terminology used, please see the Glossary of Terms.

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: BUY — since 4/4/2016

TTI

Our main directional indicator, the Domestic Trend Tracking Index (TTI-green line in above chart) has recently crawled above its long term trend line (red) and finally generated a new “Buy” signal effective 11/3/15. The market subsequently dropped, and we exited again on 11/13/15. As of today, the TTI has just moved above its trend line by +1.82%. As of Monday, April 4, 2016 a new Domestic Buy signal became effective as posted on the blog.

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