Archive for the ‘Market Update’ Category

The Best

The best of America, on display in Texas:

boat rescue

In the main stream media, and on our college campuses, this would be be referred to as ‘toxic masculinity’.

A little background on this heroes t-shirt, which carries the phrase “Molon Labe”:  From wikipedia.com:

Molon labe has been repeated by many generals and politicians to express an army’s or nation’s determination not to surrender. The motto ΜΟΛΩΝ ΛΑΒΕ is on the emblem of the Greek First Army Corps and the Cypriot Second Infantry Division, and is also the motto of United States Special Operations Command Central (SOCCENT).[4] The expression “Come and take it” was a slogan in the Texas Revolution.

Have a great Labor Day Holiday

Russia Hates Trump

As August comes to a close every country ETF(Equity Exchange Traded Fund)is positive for the year.  Average gain is 20%.  Except for Russia(-4.9%):

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Hat tip Charlie Bilello

Stat of the Day

From Brian Wesbury:  January to August 2017, US added 125,00 manufacturing jobs. In 2016, January to August manufacturing lost 45,000 jobs.

Hmm, I wonder what changed…

Jobs Data Disappoints

Key bit:  This morning’s employment report for August showed a 156K increase in total nonfarm payrolls, which was worse than forecasts. The unemployment rate ticked up to 4.4%. The Investing.com consensus was for 180K new jobs and the unemployment rate to remain at 4.3%. June and July nonfarm payrolls were revised for a total loss of 41K.

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Bonds(AGG/Barclays Aggregate Bond Fund)are down on the ‘disappointing’ news but have rebounded off the early lows. The AGG/TLT/IEF bond funds will all finish the week well above key support.  The uptrend since the early July low is still intact.

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Hat tip dshort.com

 

Slippery September

September is the worst month of the year for equities.  Key bit: Since 1928, no month sports a lower average return than September, with the S&P 500 down 1.0% on average. February and May are the only other months that are generally in the negative, while July surprisingly tends to be the strongest month of the year.

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More: 

The worst September ever for the S&P 500 resulted in a 30% drop in 1931. In fact, no other month has had more 10% drops than September at seven. Interestingly, January is the only month that has never been down 10% or more.

Over the past 10 years, September has been positive on average, with the S&P 500 up 0.1%. But it is worth noting that September has been lower each of the past three years.

Since 1950, if the S&P 500 starts the month of September above its 200-day moving average (like 2017 will), it tends to do much better, as it is up 0.4% on average versus down 2.7% if it starts the month below the 200-day moving average.

Great stuff from LPL Research.

Ten Straight

The S&P 500 Index finished August in the green, the tenth straight monthly advance.  It has been positive 17 of the last 18 months.  Incredible:

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In the immortal words of world renowned Nobel Prize winning economist Paul Krugman shortly after Trump’s victory in November: 

“It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?

Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.

Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.”

Emphasis added.

The S&P 500 hasn’t had a down month, based on total return, since last October.  That’s the longest streak since 1945:

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Of note, Paul Krugman has 3.4 million twitter followers.  Those folks are getting some quality advice. 

Hat tip Charlie Bilello

 

 

Employment Report Tomorrow

Looking ahead to tomorrow’s big economic news.  From Brian Gilmartin of Trinity Asset Mgmt:     The ADP report, released Wednesday morning, was stronger than expected, showing growth of 237,000 private sector payroll jobs versus the 190,000 that was expected.

This morning’s “jobless claims” report was benign, but the overall jobless claims level is now hovering around 230,000 – 235,000 claims which is a very low level historically.

Tomorrow morning, August ’17 nonfarm payroll report is expected to show 180,000 “net new jobs” created by the US economy in August.

Analysis: The 180,000 consensus has been in place now for probably two years. Watch the unemployment rate over time as it continues to head towards 4%. The US economy continues to be in good shape, but the implications of a 4% unemployment rate means that people with lower skill levels are going to be gradually pulled into the workforce, which is always a plus, OR the jobs go unfilled and the trend towards automation is accelerated.

QQQ

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The Streak

Just a reminder, as we head into the slowest volume period of the year.  The S&P 500 has not had a 3% or more correction since before the election.  The second longest steak ever continues, incredible: 

the streak

In addition, the S&P 500 has remained above its 200 day moving average for 294 straight days.  Now a top ten streak:

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Hat tip Charlie Bilello

Slow Days Are Coming

Outside of the Christmas to New Years period, the days heading into Labor Day weekend are usually the lowest volume sessions of the year.  As this week nears an end we expect activity to slow to a crawl.  It’s simply seasonal.  

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