Feeble finish to a tempestuous quarter on Wall Street

Today was the day when portfolio managers decided that the rally of the past three days since Yellen's reassuring comments about interest rates had run its course and thus began a very modest selloff sending the Dow down an equally modest 31 points.  There was neither good news nor bad news so the consensus seems to be to sit on the gains made during the last seven weeks, which pulled the market out of correction and into the black for the first time in 2016.  Jobless claims were a bit up but still within solid range of a healthy labor market.  Now all eyes are on tomorrow's non-farm payrolls which will give a clearer picture of the economy.  But volume will likely remain subdued (6.8 vs a 7.7 billion average) until Q1 earnings start next month, which again are expected to be substantially dented.  At this time the forecast is for a 7% drop in profits.  Do I hear an echo?  This happened all four quarters of 2015 and was proven false each time.  Not only was there no dip last year but each quarter even saw a modest increase, not bad considering it was supposed to be a bath.  My guess is the same thing will happen this time around.

Wall Street plows higher as anxiety falls to seven-month low

One more day for investors to digest Janet Yellen's remarks yesterday left them feeling more optimistic yet and pushed the Dow up another 83 points.  Correlated to this was a dip in the VIX "fear guage" sending it down nearly another 2 percent to its lowest levels since before the August crisis with China.  All the indexes got a boost today but volume, at 6.6 billion (below the 7.8 billion average) indicates there's still a good deal of caution in the mix.

Wall Street hits 2016 high after Yellen delivers

It was yet another day when all the scared rabbits in the crowd were hedging their bets against bad news from the Fed, thus driving the Dow down a hundred points right out the gate.  Then you saw it happening like magic -- right around noon, as Yellen was telling the world that, contrary to fears incited earlier, the Fed would continue to exercise caution in the wake of global uncertainty (exactly what the world wanted to hear) that the Dow went soaring ... and kept soaring until close, bringing the Dow up 97 points for the session.  So if all the hedgers weren't being such nervous Nellies, the index would have been up almost 200 points.  Yesterday, it was reported the S&P was almost in the black for the year after a very bad winter.  As of today, it is officially now back in the black, all this despite an additional 2.5 percent drop in crude.  Because of the "good news" on interest rates, banking stocks like BofA were the ones to take the hit, down one percent.  Trading overall got a little bit back to normal today with 7.0 billion against a one-month average of 7.8 billion shares.

Wall Street ends flat after choppy session

Yes, the market ended relatively flat (the Dow up a modest 20 points) but choppy?  Yes, it dropped about 20 points right out the gate before going through ebbs and flows to gain another hundred points by 2 pm and then falling in again to close modestly up.  But since so many are out on break and volume was thus demonstrably thin at 5.1 billion, none of it really means much.  Oil is once again below $40/barrel and February consumer spending remained staid, which is either good (maybe the Fed will be more cautious about the interest rates) or bad (the recovery is stalling.)  All of the above means that Yellen's speech tomorrow in New York will be closely watched.  Just let's not forget that the S&P has now almost completely recovered from a very bad start to the year.  It's just that investors are not yet completely convinced that it's going to stay that way.

Succinct Summation of Week’s Events 3.25.16 (plus Masters In Business)

Hope everyone is enjoying their Easter/spring break.  I for one am free for two weeks since everyone I have meetings with is on break, two weeks that I'll be spending doing a lot of writing.  Meanwhile, here's the succinct summation I deliver every week at this time.  And the bonus this Sunday is a one-hour podcast by Slate's Helaine Olen in which she gives quite sage advice on why we should NOT be listening to MOST financial advisors, particularly the ones on TV and cable.  The hint in the opening narrative is that she socks it to the celebrity advisors like Suze Orman, which is fine by me.  I always thought one should be suspicious of these television gurus for, if they really knew what they were talking about, why would they be giving it away on television?  If you're one of the many who are on break this week, enjoy!

10 Weekend Reads

Submitted for your consideration, Ritholtz's latest reading list fresh off the presses.  The one that's got my curiosity is the Boston Globe story about the origins of ISIS.  Why do I suspect some major surprises there?  Wishing everyone a wonderful Easter.

10 Weekend Reads 3/26/16 - The Big Picture

The Golden Age of Astrophysics

The markets are closed for Good Friday so, in my usual tradition, I am borrowing words of wisdom from the indomitable Barry Ritholtz.  It would take someone of his genius to think enough outside the box to be able to draw a lesson from astrophysics on investing, and validating his undying optimism about our future ... but he does!  Enjoy and have a great Easter weekend!

The Golden Age of Astrophysics - The Big Picture

Wall St. closes flat, five-week rally ends

Really Thu, 3-24-16
Believe it or not, we had a really late birthday party for my neighbor.  She's still quite the pistol at 75.

Anyway, the headline makes it sound like another nondescript day but the fact is the market fell a hundred points right out the gate as the market continues to digest the Brussels attacks and the latest Fed faux pas in letting it slip that the possibility is still out there for more than two rate hikes later this year.  To make matters worse, crude stockpiles are now at record highs which certainly is not helping the oil slump at all.  But most of these losses were offset as the session progressed and we actually ended the day with the Dow 13 points up.  The better news is that it is a holiday week, many people are taking off for spring break, volume is tepid at 6.2 billion, so nothing that happens this week can be taken as typical.  Nevertheless, the markets are still well off their lows due to a reviving economy and the recent sharp rebound in oil  We'll see what happens come Monday.

Wall Street rally fizzles out as oil, materials fall

A second day after Brussels and the market continues to digest consequences.  It also didn't help that loose lips at the Fed began hinting that there may be more than two rate hikes this year after all, plus bad news from oil with a new report that stockpiles from crude were on the rise again.  The combined impact was more panic selling, this time driving the Dow down another 80 points.  But the selling was all on light volume of only 6.8 billion vs the month's average of 8.1 billion.  It's another short week so next week will tell better.

Wall St. down but pares losses after Brussels blasts

Today was a testament to the market's durability as, even though the Brussels attacks initially brought the index down about 50 points, it bounced back within hours and was even up a little until mid-afternoon when it sank again to a 41 point loss.  The market has sort of factored terrorist attacks into the equation now so this modest reaction pretty much fits the patterns of previous attacks like Paris.  Still, for a while today, everyone was buying gold and government bonds like crazy, the traditional safe havens.  Oil wasn't even impacted all that much.  But it's likely that the real reaction will be coming in the next day or two since volume was only 6.2 billion, an indication that most of the money remains on the sidelines waiting to see what coming next in the news.

Wall St. ends flat as recent rally spurs caution

The furious buying spree slowed down a bit today as the market tries to assess whether stocks are now overpriced.  After a five-week rally, particularly energized by the recent Fed announcement that there would only be two more rate hikes this year when four were expected, the Dow ended up a modest 21 points as investors continue to digest what is popularly taken as good news.  Crude also continued edging up as a major U.S. delivery hub reported a much needed drawdown and the highly controversial Valeant Pharmaceuticals continued to self-destruct losing another 7-1/2% of its value after losing more than 50% last week.  As the market continues to evaluate the environment, volume was below average at 6.2 billion.

Succinct Summation of Week’s Events 3.18.16 (+ rules of other people's money + wealth portfolios)

The week's one-page summary is here leading with the S&P enjoying 1% gains for the 5th consecutive week and for the first time in seven years.  (Last week I included an article about the significance of this.  This Sunday's bonus is yesterday's Washington Post column where Ritholtz discusses the ethics and duties of managing client portfolios.  Most (if not all) of you are only interested in your own but as I am but 5 weeks and 3 days from beginning the CFP training, it is of particular interest to me.  This article is a brief introduction to what I'm about to spend two years studying -- that despite the common perception that advisors and Wall Street are all a bunch of corrupt crooks, there are in fact a legion of ethical standards which must be adhered to or one is not allowed to be in the profession.  I am particularly excited about learning all this stuff.

Bethany McLean - The Big Picture

Today's Big Picture post is all about the indomitable Bethany McLean and today's 48 minute podcast on Masters In Business.  Ms. McLean is the Vanity Fair editor who blew the roof off Enron with her famous book, "The Smartest Guys In the Room: The Amazing Rise and Scandalous Fall of Enron."  This book subsequently became the basis of the documentary of the same title that won the Best Documentary Oscar in 2006.  She also penned a book on the hidden history of the financial crisis.  She saw both of those coming.  What else does she see?  Click on the "Bloomberg" link for immediate access.

MiB: Bethany McLean - The Big Picture

S&P 500 turns positive for 2016 as recession fears fade

The rally continues now into its 3rd straight day as the market continues to digest Wednesday's announcement from the Fed and continues to decide that it really likes what it heard.  The announcement has continued to bolster oil prices, now up over $42 per barrel, and the Dow has been closing higher and higher each day, today up another 120, now officially in the black for 2016.  The interest rate announcement was most welcome news for multinational stocks that have big overseas exposure, thus easing recession fears (that are now virtually written off) and emboldening equities.  Other good news includes another drop in the VIX, that closely watched volatility index that measures the market's nervousness and is now at its lowest since early August.  Volume was extreme at almost 11 billion, but this must be disregarded since much of it came from the periodical "quadruple witching" where options and futures on stocks and indexes are all expiring and being repurchased all at once.  I do wish they'd publish this data net of all the "noise" so we'd know the real volume.  Next week's numbers will tell a much more accurate story.

Dow closes positive for year as commodities rally, dollar dives

I suppose that when a big announcement comes as late as 2 p.m. on a certain day that it might take the market overnight to digest it.  That seems to be exactly what happened today as the Fed's announcement of only 2 interest rate hikes this year when 4 were expected sunk in and sent the Dow soaring 155 points.  It was enough to once again put the Dow into positive territory for the year after one of the worst Januaries on record.  Oil also had a really good day going once again over $40 per barrel on new hopes that producers are getting serious about freezing output.  Today both the Dow and S&P were at their highest since December 31st and this was confirmed by the extraordinarily high volume of 8.2 billion.

Wall St. closes at 2016 high as Fed signals fewer rate hikes

"Wait-and-see" is over, for now anyway.  The Fed must have made its announcement right around 2 p.m. because, until then, everything was just sort of ho-hum.  Then suddenly it zoomed - almost 200 points - until finally settling in the last 20 minutes for a 74 point gain.  The market was expecting no further news on interest rates.  Instead, there was the pleasant surprise that there would likely be only two very modest hikes later this year, half the amount investors thought.  Oil also had a great day, zooming 6 percent on news that producers might freeze output, and that on top of news that stockpiles had grown less than expected.  It all created the lowest volatility index since early December.  All in all, sufficient reason to celebrate.  At 7.6 billion shares traded, volume was just a little below recent averages of 8.1 billion.

Wall St. dips as healthcare lags before Fed statement

So we had day #2 of wait-and-see since the Fed does not issue its latest statement about the future of interest rates until tomorrow.  Still the chart, despite the relatively low volume of 6.5 billion, showed there was a good deal of activity with the Dow dropping 110 points right out the gate only to steadily recover throughout the session for a close a very modest 22 points up.  In other words, if not for the very bad day that the very controversial Valeant Pharmaceuticals had losing over half of its value in a single session, the Dow may have had a very nice 130 point gain today.  But breaking even is always better than losing and, after all, tomorrow will tell the real story.

Wall St. ends flat as Fed meeting looms

This time it really was a day of light trading with the Dow reaching only 6.3 billion as the market digested the sum of last week's news and played wait-and-see on the sum of what's coming this week.  This week will be the March Fed meeting in which the expected no news will be good news and the release of more new economic data including retail sales.  Oil was down 4% but this was not unexpected after a six-week rally that has brought the S&P back more than 90% from its lows just a few weeks ago.  The day was not without its drama dropping 50 points right out the gate, then coming back to a 60 point gain (110 points total) before settling back in the final half hour to a modest 15 point gain.  So though it ended flat, it was hardly a flat day, just a wait-and-see day.  Things will pop more on Wednesday if there are any surprises from the Fed (not to mention surprises from the first winner-take-all Super Tuesday.)

Succinct Summations of Week’s Events for 3.11.16

It's the weekly eye-shot with mostly good news, at the top of the list the gains in the S&P for the fourth consecutive week, the first time this has happened since 2013.  This weekend's bonus is Ritholtz's Sunday reading list.  Pay particular attention to item #2: "Why Do Academic Researchers Avoid Behavioral Finance?"  Indeed, why does academia ignore behavioral science when it comes to investments?  As I prepare to begin the two years of CFP training (in about six weeks), I guess maybe I'll find out (or I'll end up teaching them something!)  Also pay especially particular attention to the chart at the end showing how marijuana coming into the U.S. has reached a new low point in the past seven years, half of what it was just a few years ago.  Maybe something's going right with the war on drugs after all.  Hope everyone had a great weekend!

Things rich people tend to have in common

Really good tips here, not only for success in business, but for success anywhere. It's all traditional, nothing new, but what a fantastic summation.

Things rich people tend to have in common - Business Insider

ECB stimulus, firmer oil push S&P 500 to 2016 high

Oops, really Friday!  Doesn't happen often that I'm this late getting the post off.  Oil had another really good day with crude up 2% and with the black stuff now finally over $40/barrel again, the experts are now saying that maybe we have finally seen a bottom.  But oil wasn't the whole story today.  Instead, investors have taken a day to digest yesterday's ECB announcement and finally decided that there was a whole lot more good to it than bad, thereby shooting the Dow up a big 218 points.  Basically, the schizophrenia has dissipated with the market now shrugging off Draghi's negativity as an empty threat.  Hey, he's changed his mind before, hasn't he?  So the big rally that should have happened yesterday happened today instead.  The S&P is in sharp recovery, down only 1% now for the year in stark contrast to the nearly 10% from January.  Volume was 7.5 billion, a little below the recent elevated average of 8.5 billion.

Wall Street ends flat as Draghi disappoints

The headline says the market ended flat today but that's not exactly what happened.  Actually it was quite the tumultuous ride with an over 300 point swing during the session.  The day started with a bang with Mario Draghi, the head of the ECB, announcing what everyone wanted to hear - another rate cut for Europe's banks, keeping interest rates near zero.  And the Dow shot up 130 points right out the gate.  Then Draghi made a secondary comment that no one liked -- hey, banks, this is the last time.  What followed for the rest of the day was an absolutely psychotic series of peaks and valleys as investors tried to digest a great deal of contradictory emotion -- gee we love these zero interest rates, free money! -- but don't these lower rates ultimately harm banks and exports and devalue the euro?  And what about the labor market which today reported the lowest jobless claims since October?  Isn't that good news?  Or not?  With all this schizophrenia, the market went from 130 points up to 175 points down but, in the end, the optimists ruled the day and the Dow came back to close almost exactly even with the open.  But it was hardly a boring day. The proof of this is we were back to our recent trends of vigorous daily volumes at 8.4 billion.

Oil rally lifts Wall Street, extending tight correlation

Typical Wall Street, just because we've had one day of trading at normal levels after over two months of abnormally high levels, they're calling it a "low volume" day.  Everything is, "What have you done for me lately?," a very dangerous way to think.  Anyway, at 7.5 billion, it wasn't really low volume at all and, if that is now what is considered light trading, we're in trouble, especially if you look at the daily chart that shows downright frenetic trading with many wild swings throughout the session.  But the bottom line is that oil had another good day, this time buoyed by reports that inventories, which have been glutted for a long time, were now in line with expectations.  This shot crude up 5 percent, the energy index as a whole up 1.5%, and the Dow up 36 points.  But as today's New York expert states, the wild swings will continue until oil stabilizes.  Good luck with that.  We can hardly see stability as long as we're producing so much more than what we can sell.

Oil drop, China data drag Wall Street lower

The recent rather dramatic rally that brought oil back 35% from its January lows couldn't last forever.  Today oil had its first bad day since all the wonderful news started and so, quite predictably, the rest of the market had a bad day too.  Crude lost 4 percent, its largest daily dip since hitting bottom on February 11th.  Since then it's risen over 45 percent.  So it's had one bad day but it's still not so bad being down 4 from 45 when one looks at the past year.  Still, investors are back to being nervous again (how fickle we are!) with concerns over China once again on everyone's mind, sending the Dow down almost 110 points.  But the chart shows the day was going pretty well up until 2 pm and then slid precipitously in the final two hours.  As has been typical this year, volume was very robust at 8.5 billion.

S&P 500 ticks above 2,000 as energy offsets tech slide

Another day of nothing but good news, not only domestically but globally as well, sent the Dow up another 67 points, the S&P having one more day over 2,000 and the index up for the fifth consecutive session and up more than 23% since January.  Oil had another terrific day, up more than 5 percent in today's trading.  The recent boost in the entire energy sector has helped encourage the stock bounce.  It seems that oil has finally found its footing and that's what Wall Street has been waiting for.  Trading was very rigorous at 9 billion.

Succinct Summations of Week’s Events 3.4.16 (+ weekend reads)

It's time for everyone's favorite post -- the week's summary, courtesy of Barry Ritholtz.  At the top of the list of course is the much feted jobs numbers in Friday's news with employment data not only coming in much higher than expected, but prior months' figures being upped as well.  This Sunday's bonus is Ritholtz's heralded weekend reading list.  And at the top of that list is this week's most intriguing piece of opinion from Barron's, "Trump or Clinton: Who's Better for Investors?"  (The answer may surprise you.)  I would also urge everyone to take a good close look at the S&P history chart at the bottom, in which the index's biggest 1% daily moves dating from 1928 to 2016 is all laid out in one very crisp little chart.  Isn't it also interesting to note that most of these big moves happened right before a major economic boom?  2016 is one of the years that we've had a big 1% move.  Who knows?

10 Guaranteed Ways to Retire Rich

I'm doing a slight departure from the norm this weekend by borrowing from AOL Finance instead of Barry Ritholtz's The Big Picture.  But this particular article struck me as not only cogent but particularly well written on a topic of great interest to all of us.  Nothing particularly new here but the advice is all very traditional and very sound and a good reminder every now and then doesn't hurt anything.

10 Guaranteed Ways to Retire Rich - DailyFinance

Wall Street pulls off a rare four-day winning streak

Well, the February employment numbers came in big.  What was expected to be an optimistic 190,000 new jobs (up from 151,000 in January) was instead a monumental 242,000 new jobs, once again bolstering investor confidence that the economy was strong and that perhaps the Fed may take the hint and decide no further rate hikes are warranted this year.  There was also more terrific news besides the very unusual 4-day winning streak for the S&P.  Aside from the fears of recession sort of now becoming a non-issue, the Dow has once again topped 17,000 and the S&P landed exactly 1/100% below 2,000 - both considered very psychologically important thresholds.  Today the Dow is up nearly 63, the S&P nearly 7.  But just to temper the optimism ever so slightly, the high employment numbers still represent a disproportionately high number of low wage and less than full-time jobs.  So there is still work to do, the battle not yet won.  Volume was very high at 10.3 billion.

Wall Street snaps up shares in late-day scramble

A late day scramble?  That's hardly what the chart says.  The upswing started at 11:30 a.m. and kept going steadily the rest of the session.  Needless to say, it was another good day for oil with crude now up 35% from last month and both the energy and financial sectors now subsequently lifted into positive territory for the year after the worst January in seven years.  Just as energy is up, the financial sector has also seen a 13% boost in 3 weeks.  All in all, investors see these developments as a sign of improving sentiment, which is what the market's been looking for a good long time now.  Volume was right in line with recent elevated averages at 8.8 billion shares traded.

Wall St. rises late, led by energy and bank shares

It was quite the choppy day with the Dow being down as much as 100 points in mid-session but then recovering to close 34 points up.  Really, there was no good reason for the earlier sell off so it should have been 130 points up.  Oil had another good day, once again reassuring investors that we are not heading into recession and that China's impact on the U.S. markets would be minimal.  Even the prospect of a Fed rate hike with all the good news lately did not faze anyone but was in fact taken as good news for a change as it (surprise, surprise) boosts bank stocks.  Continuing strong jobs data bolstered the view that the economy was in good shape and the Volatility Index closed at its lowest level for the year.  At 8.2 billion, volume was close to recent averages.

Wall Street chalks up strongest day in a month

The big rally Wall Street should have had yesterday when oil shot up 3% did finally happen today when oil continued its rally another 2% shooting the Dow way up another 348 points.  A plethora of other good news helped -- new orders growth, improving inventories, construction spending, strong auto sales.  The bottom line is that, at least for today, investors are back to believing that oil's big recession may finally be over and that the general fears that China's problems may soon be causing a global recession are unfounded.  Volume was right back up there with recent elevated averages at 8.8 billion shares.