Wall St. ends May with whimper as energy shares slump

Well, I'm about as ready for tomorrow as I'm going to be.  By 1:15 p.m. I should know whether I'm still a candidate for the CFP or am on the road to expulsion.  It's been a very discouraging and frustrating couple of days.  I may have mentioned earlier that I was told that 3 hours of reading and study for the exam tomorrow would be sufficient.  I've already put in more than triple that.

Succinct Summation of Week’s Events 5.27.16 (plus the Future of Money)

They call it M-Pessa and it has been used quite successfully for years in Kenya as a new form of electronic currency, considerably easier, cheaper, and more efficient than other forms of exchange used throughout the world.  They're calling it "The Future of Money" and 60 Minutes has the story.  It's not a new story (though it did run in repeat last night) but one that's well worth another look.  Meanwhile, it's time for the succinct summary again including an upward revision of more than 50% for Q1 GDP. (Don't get too excited.  It's still under 1% total.)   Hope everyone had a great holiday.

Telling Clients No

Immediately following this Memorial Day weekend, it will only be a matter of hours before I attend my 2nd mentorship session in the CFP program and my first session where I will be expected to have prepared material and an exam on said material.

Are You Saving Enough to Retire?

For this Memorial Day weekend, once again a picture is worth a thousand words.  Here's a single graphic that sums up everything you need to know about planning a retirement ...

Wall Street puts finishing touch on best week since March

For the third consecutive day, investors are showing an ever increasing comfort level with the likelihood of a June or July rate hike and thus the Dow continues to climb, today to the modest sum of 44 points.  Today's comments from Janet Yellen seemed to offer additional reassurance that any such steps would be "appropriate" and the market continues to see a hike as a vote of confidence in the overall health of the economy.  Reports today also reaffirmed the fact that Q1 growth had not slowed as badly as originally thought.  Still, with the holiday weekend, trading was quite thin, only 5.6 billion shares, way below recent averages but certainly well in line with holiday averages.

Wall Street hits 'pause' after two-day surge

After two days of triple-digit gains, the market took a breather today as investors resign themselves to a rate hike in the foreseeable future.  But in spite of a new report showing healthy manufacturing orders, weakness in that sector is still considered far from solved.  And it may just be the fact that traditionally trading slows on a holiday weekend.  In any event, the Dow went down a modest 23 points as everyone waits for the next sign of good news for a new buy point.  As is typical for a holiday, volume was down considerably to just 5.8 billion shares.

S&P 500 ascends 2 percent in two days

For the second straight day investors continue to digest the likelihood of a sooner than later rate hike and continue to accept that it probably won't be that big a deal.  So for the second straight day, the Dow is again up triple digits, this time 145 points.  Part of this is a boost from oil which, after the latest reports of smaller than expected inventories, crude shot up again and is now approaching $50 per barrel giving the market more reassurance that perhaps the black stuff is on its way back up at last.  (Keep in mind it wasn't too many weeks ago that it was in the mid-30s.)  Investors also consider that the only reason policy makers are considering a sooner rate increase is because of the plethora of upbeat economic data, and that ain't a bad thing either.  Odds makers are now putting the probability of a June rate hike at 38 percent (up from 30 last week, up from 15 the week prior) but July at 45, which most agree is much more likely.  (After all, June is right around the corner.)  Volume was 6.9 billion, a little below recent averages.

Banks and tech drive Wall Street up over 1 percent

It's happened before and I'm sure it'll happen again.  The Fed gives the slightest hint of an interest rate hike and everyone sells in a panic.  The next day investors figure out that a rate hike might not be such a bad thing after all.  In fact, it can be downright good for financial stocks.  And so they start buying again with a vengeance.  That's what happened today shooting the Dow up a big 213 points when sentiment changed positive on the likelihood that rate hikes would be gradual (something the Fed has been stressing since Day One) and then seeing stocks like B of A and Citigroup shoot up.  Home sales also surged to an eight year high offering further evidence of a growing economy.  Volume was 6.9 billion, close to the month's average of 7.2 billion.

Wall Street dips; Apple gain fails to offset rate worries

It's good to have a boring day once in a while and today qualified with the Dow vacillating within a relatively narrow range and ending the session just 8 points down.  Apple finally had a good day but investors remain concerned about Fed interest rate policy and so today was just so much fence sitting, reflected in the low volume of only 5.9 billion shares.  But as today's expert states, "The market needs to be coddled and gently eased into a slightly higher interest rate environment, and that appears to be what the Fed is doing.  Rates need to normalize and the Fed needs to give itself room to lower again in the event of another financial crisis."  In other words, despite concerns to the contrary, things seem to be on the right track.  But tomorrow is another day.

Succinct Summation of Week’s Events 5.20.16 (plus The New Market Wizards)

Good news!  U.S. stocks end their 3 week losing streak.  Plus more in this weekend's succinct summation.  Our Sunday bonus this time is a short summary and link to the audio book for the newly revised "The New Market Wizards" complete with all the changes in strategy from the original book.  Enjoy and hope everyone had a great weekend.

10 Weekend Reads

For this weekend, a list of current articles courtesy of Mr. Ritholtz.  Of particular interest are the two dissections of the great mortgage industry fraud that triggered the Great Recession.  Hope everyone's having a good weekend.

Wall Street ends volatile week on high note as tech leads

The market has just about now absorbed the shock of a potential June rate hike with all its gyrations since Wednesday with the odds makers shooting the likelihood of a June hike from 15 to 30 percent in one day.  But that's still a 70 percent chance of no June hike and, as today's expert has so wisely pointed out, it's a "positive dynamic if the market can actually go up in the face of the Fed probability going up."  And as was also pointed out on Wednesday, the Fed will raise rates and the market will be okay.  The combined impact of all of the above was a 65 point bump in the Dow, not a lot but at least in the right direction.  Home resales are doing well which further suggests a better Q2 is in our future.  This is the second day that no volume data was reported but, according to BATS, it was 6.7 billion shares, below the 7.3 billion average.

Stocks weaken, dollar gains amid Fed hike talk

Fed fears still abound regarding the next interest rate hike, the odds makers doubling down just since Tuesday when a June hike was only a 15% likelihood and is today clocking in at 32%.  Truth be told, it is far more likely that any hike won't come until July at the earliest, but even that is much sooner than was expected prior to this week.  To be fair, the fear mongers caused a nearly 200 point drop right out the gate this morning but more rational minds pushed the Dow back up to close just 91 points down by end of session.  As worries about the global economy persist and eyes are on not only our own Fed but the European and Asian central banks as well, every negative report is going to generate a negative reaction even if accompanied by a multitude of more positive reports.  Even though there have been positive reports throughout the week, there was nothing encouraging today as investors continue to try second-guessing Fed policy moves.  Volume was right in line with the 7.3 billion average of the past month.

Bank shares buoy Wall Street as Fed signals possible June hike

Day #2 of panic per the Fed.  It was bad enough that Target became yet another consumer products company to turn in a meager Q1 report.  Even with that though, the market went up 136 points.  Then, like clockwork, at 1:30 p.m., the Dow dropped like a rock - 200 points! - before recovering in the late afternoon to end the session just 3 points down.  It was just about 1:30 when the minutes of the Fed's meeting were published and showed that yesterday's "hint" of a sooner-than-expected interest rate hike was now much more than a hint.  Depending on whether we have a good Q2, the next hike could be coming as soon as June.  This is not what the market wants but - as today's expert opines - it IS time that the Fed normalize policy.  It's time for zero interest to end.  And the markets WILL be okay! --  I suspect this is exactly right and the fact that the Dow recovered so quickly and so completely tells me the smart money thinks so too.  Volume was above average at 8 billion shares.

Wall Street sells off amid Fed rate hike jitters

It was yet another day when good news was taken as bad news.  Since the major economic indicators are showing a steadily improving recovery, it only took the slightest of hints from the Fed that there may be more interest rate hikes later this year.  That's all it took for everyone to run for the exits and drive the Dow down 180 points, thereby erasing all of yesterday's gains (which in itself was not quite enough to make up for Friday's big losses.)  So though the decision was triggered by reports of a healthy recovery, which should be what everyone wants, and though everyone agrees that interest rates must go up to stabilize this very volatile market, nobody but nobody wants them to go up anytime soon.  Investors like the easy borrowing even if they know it's bad for the economy.  The good news from Home Depot's strong Q1 report was not even enough to quell the interest rate fears.  Ironically, despite the good report, Home Depot dropped 2.5% and became the biggest drag on the market.  Bad timing, the Home Depot report might have had the opposite effect had it not been for the Fed hint.  Wal-Mart and Target are yet to come later this week.  Volume was just a little above recent averages at 7.5 billion shares.

Apple, energy shares shine as Wall Street rallies

You know it's a really good day when someone of Warren Buffett's stature gets into the picture and drops a billion dollars on the market.  That and the good news about oil sent the Dow up a big 175 points, almost recouping the whole of yesterday's losses.  Apple has, of course, been the troublemaker for a while now, losing substantial capitalization due to China's problems and its impact on iPhone sales.  But Buffett must feel there's still a great future with the Silicon Valley giant and has simply determined with the company's recent travails that the price has gone low enough to now make it a really great buy.  So today he bought a $1 billion dollar position in Apple.  Oil also went to a six-month high on further news of more supply outages which will help to draw down the big surplus inventories.  And the final bit of good news is that, though the consumer sector that everyone had high hopes but has so far disappointed for Q1, there are still a few giants like Wal-Mart and Target that report later this week, and they may reverse this tide.  6.5 billion shares were traded, a little below the 7.2 billion average of the past month.

Succinct Summation of week’s events 5.13.16 ( + humanity's limits?)

This Sunday's summation includes consumer sentiment and job openings both up as positives and a third straight week of index losses as a negative.  For the bonus, Barry Ritholtz shares with us in today's posting a fascinating seven minute video on the limits of humanity's reach into the realm of discovery, from a strictly scientific perspective of course.  It also serves as a pretty decent seven minute history of the universe.  Anyway, a very entertaining seven minutes to say the least.  Hope everyone had a great weekend.

10 Weekend Reads (plus pension funds)

This weekend's contribution to the cause, courtesy once again of Barry Ritholtz, are ten interesting articles.  You may note that at the top of the list are essays about the virtues of index funds and vices of chasing the big yields.  But the graphic of the trend in recent years of pension funds being invested in hedge funds is what I found most intriguing.  It's also more than a little scary that pension funds are putting retirement dollars at risk by buying into these.  Twenty years ago, not only was this unheard of but it was illegal for pensions to be invested in anything this speculative.  It's especially interesting that this graph would show up on the same list as the articles about index funds vs high yields.  It is an ever-changing world.

Wall Street drops at end of tough week for retailers

The major and very unexpected drubbing that the consumer discretionary sector has taken this week continued in earnest today as Nordstrom, Penney's and Macy's all came in with much worse earnings declines than had been forecast.  As reported last week, not only did the consumer sector fail in expectations to come in with double-digit increases this week but actually came in with losses, many of them double-digits, so the opposite of what was hoped for.  All that being said, even today's report of a 1.3% increase in April retail sales was not enough to prevent the 185 point slump the Dow had today with the release of these latest Q1 reports.  So Q1 is basically over and, even though it wasn't as bad as expected, at least the market had the hope for a considerably better Q2.  The really bad news today is that Q2 is no longer looking so hopeful.  For every S&P company that has forecast better Q2 earnings, there are more than 2 others that are forecasting a worse Q2.  The market reacted with 6.6 billion trades, a little lighter than the 7.2 billion average of the past month.

Wall Street mixed as Apple tumbles to two-year low

Apple, as it has been at times, was once again the market's bane as its continuing iPhone problems triggered a near 200 point nosedive before the Dow recovered with a 9 point gain.   Q1 is basically over with most companies exceeding expectations and the original 7% earnings decline forecast revised a couple weeks ago to 5.5% and today revised upwardly again to a 5.4% decline, this despite yesterday's unexpected reversal in the consumer discretionary sector.  At 7.2 billion shares, volume was in line with recent averages.

Wall Street slumps as Disney and Macy's slam consumer shares

Yesterday's big 222 point gain coming with Amazon's wonderful report were all but completely dashed today with the Dow diving an almost equally big 217 points.  Once again, the old adage "nobody knows anything" was proven.  It seems that the general consensus that the consumer discretionary sector would come in with double-digit earnings against an overall market forecast of a negative 5.5% proved completely wrong when heavy hitters like Disney, Macy's, Office Depot and Staples not only failed to turn in positive double-digits, but actually went negative, many negative in the double-digits.  This was taken as an indicator that the remaining companies in the sector will be reporting likewise and thus triggered the big nosedive.  Why?  Amazon, of course!  Yesterday's blessing proved to be today's curse.  Consumers are buying from Amazon instead of the brick-and-mortar companies.  Shocking!  That is, shocking that this was shocking.  I think most of the rest of us have known for years that this was happening.  As I said, "nobody knows anything."  Volume was near recent averages at 7.0 billion.

Amazon delivers S&P 500 its best day in two months

Just about everything went right today.  The international markets were boosted by both solid earnings in Europe and progress in both Greece and Japan.  Amazon came in big with a record high stock price, boosting the entire market including the Dow up a big 222 points and the S&P now up 2 percent for 2016 after a disastrous beginning and a middling April.  Q1 is considered history (though there are still some big reports coming) and everyone is looking forward to a better Q2.  And oil rose 4 percent on news of supply disruptions to help out with the glut.  A happy day all around with volume at 6.6 billion, a little below recent averages.

Higher health stocks and falling oil leave S&P 500 flat

The Dow down a tad 34 points as the market remains cautious about Q1.  Most of the reporting is in now with an average 5.5 percent decline in earnings but this still is not bad considering the original forecast was for a 7 percent decline.  And the best performers haven't reported yet.  There is still weak data from China so that's not helping matters but, then again, so what's new?  Analysts are giving Q1 a C/C- which seems a tad premature.  And a tad harsh considering how much better results were vs expectations.  Volume was just a little below recent averages at 6.8 billion shares.

Succinct Summation of Week’s Events 5.7.6 (plus an Internet Minute)

Summation time again and, like last week, the list is unusually lengthy, this time 5 positives and 7 negatives.  The best of the positives is that the ISM index number rose to its best level for the year indicating optimism in the economy.  The negatives weren't really all that negative, most revolving around the weaker than expected payroll report which, as discussed earlier this week, could just as easily have qualified for the positive column.  This Sunday's bonus is a fascinating graphic that shows a fairly detailed representation of what happens every minute of every day on the Internet.  Enjoy, and hope everyone had a great weekend.

Wall St. ends up after jobs report; S&P down for second week

The forecast was for 202,000 new jobs in April, down 13,000 from the 215,000 new jobs in March.  The actual number this morning came in at 160,000 (the smallest job gains since September) which caused an initial sell off before everyone took a breath and decided the number wasn't so bad after all considering the overall growing health of the economy.  Add to that the perversely positive impact that a Fed rate hike might be further delayed by this weaker number, and the Dow actually ended almost 80 points up by close.  But the really good news is that Q1 ain't over yet and the best is yet to come.  The entire discretionary sector is yet to report, coming next week.  And since the overall Q1 has already been adjusted upwards from an expected 7% down to only now a 5.3% down, if the consumer discretionary comes in at the double-digits in the black that are expected, that can change the whole complexion of Q1 very much for the better.  So the suspense continues into next week and volume was in line with recent robust averages at 7.1 billion.

It's nice every now and then to get a boring day and that's what happened today as investors sit on the fence waiting for tomorrow's federal payroll report.  Though the earlier sell off was blamed on a weak private sector report called the worst in three years, if the reporting is correct that this is a predictor for tomorrow's federal report and if the forecast is correct that the federal report will be down only 13,000 additional jobs from the relatively healthy March report, that really isn't bad.  The Reuters report does not say how bad the private sector report is but, the fact is hiring has been robust for quite some time now so if tomorrow's federal report is an indicator, then employment remains in fairly good shape.  The good news is that most Q1 reporting has beaten expectations and earnings, earlier predicted to be down over 7%, has now been revised upward to 5.3 percent.  Volume remains in line with recent elevated averages at 7.3 billion shares.

Wall St. falls as data adds to growth worries; biotechs down

More bad news brought the Dow down again almost another hundred points as the private employment report showed April hiring falling to its lowest in three years after a number of months of it being quite bullish.  As it is also considered to be a precursor to Friday's all important government payrolls report, there was lots of selling today to stem the tide of expected bad news in the next couple days.  "Sell in May and Go Away" has been chanted a lot the past few days in the hallowed halls of high finance as current data appears to justify the traditional warning that stocks don't do well in the summer.  But today's Boston expert contributes the consoling advice that we are after all still at near all-time highs so some short run consolidation has to be expected.  The good news is that the service sector expanded in April and economists forecast an added 202,000 jobs will be on Friday's report, smaller than the March increase but not by much.  Volume was a handsome 7.7 billion shares.

Wall St. loses ground on growth fears, oil slide

Yesterday the bulls were running.  Today it's the bears as the Dow retreated 140 points on a string of bad news including poor manufacturing reports from both China and Britain, oil down 2.5 percent on concerns that the Middle East is not only not cutting output but increasing it, and all three automakers stoking worries that the industry's recovery is slowing down, this despite stronger than expected April sales.  All eyes are now on the payrolls report due Friday.  Volume was above average at 7.8 billion shares.

Wall St. rebounds; Nasdaq breaks seven-day losing run

The bulls are back.  Despite Apple's continuing losing streak, its longest run of losses since 1998, there was a truckload of other good news that brightened investment outlook.  Most S&P companies have beaten Q1 expectations and the prior forecast of profits being down 7 percent have now been upwardly adjusted to 5.7 percent.  U.S. manufacturing is up for the 2nd straight month (as evidenced by the weekend's posting that Buffett was beginning to invest more heavily in that sector) and construction spending is at an 8-1/2 year high.  All in all, the boost to the Dow was 117 points.  Volume was even with recent averages at 7.1 billion.

Succinct Summation of Week’s Events 4.29.16 (plus Prince's (non) will)

This is one of the most extensive summary lists of the week's events I've seen since I've been doing this blog.  But with nine positives and nine negatives, at least it's balanced.   The most encouraging positive is that Japan's new negative interest rate policy (that is when the government charges you for saving) hasn't worked out so well so it's not likely other countries, let alone Uncle Sam, will be following suit.  The most encouraging negative is consumer confidence down to 89.0, but it was expected to be 90.0 and that ain't much of a decline.  This Sunday's bonus is an article from today's Washington Post about the nightmare being created by the negligence of rock star Prince to make a will.  The moral for the day:  everybody needs a will because nobody knows when they're going to go.  The headaches that will encumber your heirs if you fail to leave a will are beyond description.  So if you don't have one, get to it.  That is the sort of advice any CFP would give you, so why not this CFP-in-training?  Hope everyone had a great weekend!