Wall Street edges higher; S&P closes decade with nearly 190% gain

On the last day of the decade, investors seemed satisfied with yesterday’s sell off and started buying again, boosting the Dow another 76 points.  And there’s good reason to buy.  During the decade, the S&P rose nearly 200%, the Dow nearly 175%, the Nasdaq nearly 300%.  For the year the numbers were also quite impressive:  the Dow up 22%, the S&P 29%, the Nasdaq 35%.  The good news that came in today was that the China deal would be signed January 15^th.  As today’s pundit put it, “It helps to have two steps forward, one step back. It helps sustain the rally.”  As expected volume was below the 4-week average at just under 6 billion. 

Wall Street slips from records as investors lock in year-end gains

It was a day of profit taking as investors became a bit nervous about the high valuations and, having made their targets (and then some), getting out before year-end while things were still on the high side made sense.  So the Dow dropped 183 points and it will be interesting to see if the profit-taking continues on the last full day of the year or if everyone seems satisfied tomorrow.  As it is another holiday week, volume remains on the light side at just over 6.1 billion. 

Succinct Summation of Week’s Events 12.27.19 (plus a view of the nation from both right and left)

The year's final weekly summation is below with the positives being the new market highs with no end in sight as all the fundamentals remain very bullish.  The negative once again could just as easily be a positive as it relates to the China deal.  The negative is only that it's not a done deal yet, the positive being that it is very much expected to be next month, at least the Phase One part.  The negative again is that nobody really knows the details of Phase One so any celebration is likely premature. 

The Year In Picture 2019

For the final weekend of the year, U.S. News & World Report has put out a wonderful year-end issue featuring 67 marvelous photos illustrating 2019's most significant events.  I think you'll find each image to be a minor masterpiece, but there was a single photograph in particular that grabbed my eye as capturing the essence of the world of investing for 2019.  I display that picture below. (And I'll bet you all thought that the headline was a typo.)  Enjoy the rest of the weekend.

S&P 500, Dow eke out records; Nasdaq win streak ends

The market has continued its holding pattern where it will likely remain until year-end. There has been more positive data as China’s industrial profits grew at their fastest pace in eight months.  The expectation of a signed trade deal next month combined with low interest rates and strong consumer spending is a recipe for equity values to continue moving higher.  Volume continues on the light side with 5.2 billion shares vs the 4-week average of 6.8 billion.

Nasdaq tops 9,000 on boosts from Amazon, trade optimism

Even though trading remained astoundingly light as expected for this week, continuing optimism over the trade deal was still sufficient to push the Dow up another 105 points and the Nasdaq to still another record, this time breaching the 9,000 mark. The buying is continuing as the S&P is up 29% for 2019 and there is no sign of any pullback in the near future.  Adding to the optimism was the latest report on unemployment benefits which continues to confirm ongoing strength in the labor market as well as today’s MasterCard report showing even stronger online spending this holiday than last year.  Volume was 4.5 billion.  The 4-week average is 6.8 billion. 

The Best Decade In Human History

When I saw this recent article from "The Spectator" posted on Barry Ritholtz's Big Picture blog on Christmas morning, it occurred to me that there really isn't any better way to honor the Christmas tradition than to celebrate everything that's right with the world, which is something we do so seldom.  So Merry Christmas everyone and hope you enjoy below this 1500 word essay about the good. 

S&P 500, Dow pause near records in Christmas Eve trade

It was a second day of a quiet market after a week of record gains as the indexes remained flat on very thin volume of less than 3 billion shares due to the Christmas holiday.  Still, the S&P is on track for its biggest annual gain in 6 years.  Merry Christmas. 

Wall Street posts records amid trade optimism; Boeing juices Dow

Continued optimism about a soon-to-be signed trade pact reinforced by yet another Trump announcement that the pact would be signed “very shortly” shot the Dow up another 96 points.  Today was the S&P’s third consecutive record high, eighth consecutive intraday record high, and the Nasdaq’s eighth consecutive record high.  Also bolstering optimism was China lowering tariffs on a range of products thereby providing the reassurance so key to businesses that tariffs may not escalate further.  Due to Christmas, volume was under 6 billion, considerably less than the 4-week average of 7.2 billion. 

Succinct Summation of Week’s Events 12.20.19 (plus Public Gives the Economy Mixed Reviews)

Once again it's time for the weekly summation, the big positives being that, just like in the Clinton years, the stock market is proving that it doesn't care about impeachment.  There's also the small matter that we are once again at record highs, in fact making new highs practically every day as news of a trade deal become more and more positive.  The negative is also the impeachment, but fortunately only from a philosophical perspective, not an economic one. 

Master Stockpicker Peter Lynch: If You Only Invest in an Index, You’ll Never Beat It

Though there is much to be said for passive index investing (after all, study after study has shown that this strategy beats active management almost all the time), it has always certainly been the aim of our group to beat the index.  So today's post under Weekend Reads seemed particularly appropriate -- an article about Peter Lynch addressing this very topic.  The bad news is that it's from Barron's and not only could I not find this article anywhere on this link, but I'm quite certain you have to subscribe to Barron's to be able to read anything there.  But it's worth a shot.  Enjoy the weekend. 

S&P 500 posts biggest weekly percent gain since September amid data, trade optimism

With positive news on consumer spending adding to a string of upbeat data dampening recession fears, the markets had another run of record closings, the S&P registering its biggest weekly gain in four months and its seventh straight all-time intraday high, the longest streak in two years.  The Nasdaq also ended its eighth straight record close on very high volume of over 11.5 billion.  However, these high numbers (in fact the highest for the year) are the result of the usual year-end “quadruple witching” so can’t be trusted. More reliable volume numbers might be had on Monday.

Record-setting rally resumes as Mnuchin says trade deal to be signed

Today was yet another affirmation (in fact, the strongest yet) of the reality of a finalized trade deal with Steve Mnuchin’s announcement that signatures would be had in early January. But what really sealed the deal was his statement that the agreement would not be subject to renegotiation, thereby relieving concerns that something could still botch it.  As today’s expert said, “There’s still trepidation until we get to the actual signing,” but it was quite enough to bolster optimism and boost the Dow another 137 points, sending all three indexes to record highs again, the S&P for the sixth straight time, the Nasdaq for the seventh.  Volume was a little above the 4-week average at just over 7 billion. 

Wall Street pauses record-setting rally as FedEx shares tumble

Investors once again are taking a pause after several record breaking sessions.  The S&P may have taken a slight dip but still hit an intraday record while the Nasdaq hit a record for a fifth straight session.  And though the Dow took a modest 27 point dive, sentiment remains strong and upbeat on the heels of last week’s trade announcement and the impeachment is being shrugged off, the belief being that, however it goes, there will be no impact on the market.  Volume was above average at 7.7 billion. 

Wall Street extends record-setting climb on upbeat economic data

Though the Dow was up about a hundred points earlier in the day, it lost steam and closed 31 up.  A host of positive reports from housing to manufacturing to the Fed drove it up.  The rest was likely just consolidation.  But today’s consensus is that the data shows the global economy is stabilizing and the U.S. economy is solid, putting recession risks lower.  Volume was above average at nearly 7.3 billion. 

Wall Street sets records anew on trade deal boost

Another day of record closes for the markets over hopes that the interim trade deal will lift prospects for the global economy, shooting the Dow up another hundred points. Also contributing to an improving global outlook were reports that China’s industrial output and retail sales growth had accelerated in November.  The Fed increasing its balance sheet also added to good feelings, all in all an upbeat day on above average volume of nearly 7.5 billion. 

Succinct Summation of Week’s Events 12.13.19 (plus Thinking About Thinking)

The usual weekly summation is below.  On the plus side we again have all the major indexes reaching all time highs, on the minus (which could just as easily be a plus), we have a Phase One trade deal, counted as a minus only because it's quite a bit more modest than had been expected.  But the important thing to investors is that the tariffs that were to take effect yesterday have been put off and possibly avoided altogether. 

The bonus this Sunday night is one of our very favorite topics as we once again delve into the world of behavioral finance.  This weekend Barry Ritholtz posted a link on his Big Picture blog to an article providing a book list on the topic of thinking about thinking.  These titles tackle everything from the biology of behavior to the history of quant, genetic engineering and artificial intelligence.  All in all, there are ten books to explore, which should keep us all busy for a good while.  Hope everyone had a great weekend. 

Capitalism Under Attack

For your weekend reading I thought I'd offer up a very thought provoking segment of PBS' WealthTrack program aired November 21st entitled "Capitalism Under Attack."  But it's not a defense of capitalism but rather a recognition of a distinctly unfavorable trend that's has enveloped capital markets for the past 20 years, that is that the whole free market system of economics that has been so successful for the past century and a half has lately been experiencing a crisis of ethics. 

Wall Street steady as U.S., China announce trade deal

It became official today with the U.S. and China announcing an initial trade deal and the much wanted suspension of tariffs that were to take effect on the 15^th. That and Boris Johnson’s election victory have taken two major risk factors off the table. For now at least, trade war escalation and further confusion on Brexit have been averted. But more details are needed which is why the market decided the real rally was yesterday so today the Dow barely budged 3 points. Volume remained vigorous at 7.4 billion. 

Wall Street hits records on news of U.S.-China trade deal

Everyone’s had eagle eyes out on December 15^th and though it’s not really official yet and it’s probably quite a lot more watered down than the market wants, still today’s announcement of a “deal in principle” with China and new hopes of avoiding or at least delaying the new tariffs sent the Dow soaring 220 points.  All three indexes reached intraday records and the S&P and Nasdaq did post new records at close.  The trade war aside, the S&P is looking at a 26% gain for 2019.  The excitement today was palpable and volume was well above average at 8 billion shares traded. 

Wall Street posts modest gain as Fed signals rates to hold for some time

It was pretty much a repeat of yesterday except in reverse.  Everyone’s still on the fence waiting for December 15^th, but this time the Dow ended 29 points up instead of 27 points down.  Investors also took some consolation when the Fed decided to leave the benchmark rate where it is, suggesting sufficient steps have been taken to prevent a downturn.  That leaves investors to focus on the trade deal – and December 15^th.  But as today’s expert says, “we are in a pretty good interest rate environment to hopefully help the growth rate.”  As the market remains in “wait-and-see” mode, volume remains below average at 6.3 billion. 

Wall Street slips as tariff deadline closes in

It’s more of the same with everyone on pins and needles waiting to see what happens on December 15^th with the tariffs and sitting on the sidelines until there’s more clarity.  As today’s expert said, “I don’t think that the markets are going to be completely comfortable until there is a line drawn in the sand that says no new tariffs on the 15^th.”  This was reflected in the low volume of 6.3 billion and the fact that the Dow barely budged, down just 27 points. 

Wall St. falls as Apple, health shares drag, tariff deadline looms

As the critical December 15^th tariff date quickly approaches the markets pulled back a bit from last week’s near-record levels to go into “wait-and-see” mode on the trade deal. It is anyone’s best guess as to what will happen between now and Saturday.  There remains at least some hope for some minimal agreement and that nominal hope is what’s keeping everything floating. But for today at least, all the indexes pulled back a bit, the Dow to the tune of a 105 points, but at least it was all on minimal volume of just 6.2 billion shares. 

Succinct Summation of Week’s Events 12.6.19 (plus 10 Top Investing Themes for the Next Decade)

The weekly summation is below, the biggest positive being the old headline that the bull market continues in earnest. The latest evidence of this was Friday's payroll report showing nearly 90,000 more new jobs in November than had been forecast.  The biggest negative is also the old headline of the never-ending trade war, now well over a year old, and investors seeing a deal getting further and further away.  The bonus this Sunday is the latest from U.S. News Invested discussing the top 10 investing themes for the coming decade.  Speak of being succinct, this sums up the whole market environment in a few short paragraphs.  Hope everyone had a great weekend. 

170 Years of Recession

For your amusement (and information) this fascinating little chart posted today on The Big Picture blog shows the 170 history of recessions in the U.S. dating from 1850.  It is of special interest to note that the 2010's has been the only decade in history not to have even one recession.  And no sign of anything on the horizon.  Yet the cynics have been insisting for ten years that a major catastrophic recession is just around the corner.  Food for thought.  Enjoy the weekend. 

Wall Street climbs on solid jobs data, trade hopes

The market was hoping for 180,000 new jobs in November so when the actuals came in at a whopping 266,000 it further cemented the long-held assumption that the economy was fundamentally strong.  Combine that with new statements from the White House that trade talks were going very well, essentially “the reality is constructive talks, almost daily talks; we are in fact close” and the Dow shot up right out the gate and stayed there all day closing up 337 points.  At 6.6 billion, volume was right in line with the 4-week average.  And all three major indexes are once again within 1% of record highs. 

Wall Street inches higher as Dec. 15 tariff deadline looms

The market was in the red most of the day but ended just a little above even with the Dow gaining 28 points.  It was called a day of consolidation as investors try to calibrate the next move in the trade deal. But the bottom line remains, as today’s expert stated, “The markets are going to toggle up and down until we see what happens on December 15^th.”  As for the impeachment, investors are just shrugging it off.  Economic data remains encouraging showing a robust if slowing economy.  All eyes are now on Friday’s employment report where 180,000 new jobs are expected.  Volume was just a little below average at 6.4 billion. 

Wall Street bounces back on renewed trade optimism

I didn’t expect it to happen so soon but it did! Just one day after a nearly 300 point drop triggered by Trump’s comment that there might not be a deal with China for another year, today the commentary from the White House changed dramatically to indicate that trade negotiations were going “very well” and that a deal was close thereby shooting the Dow up nearly 150 points.  Again, today’s expert cautioned against putting too much stock on trade news and instead “investors should not lose sight of solid underlying market fundamentals. The consumer’s on fire.”  Next up: Friday’s employment report.  Volume was a little above average at 7 billion. 

Wall Street falls as trade hopes wane

The sky fell in today. All the hopes throughout the past months for an end to the trade war by year-end got dashed today with the announcement from Trump that he may not do a deal with China now until after next year’s election.  The double-whammy was Commerce Secretary Wilbur Ross confirming everyone’s worst fears that the new tariffs against China would take effect December 15^th.  So after yesterday’s 268 point drop, today the Dow dropped another 280 points.  No worries though.  As the trend has been, there’s every likelihood that in the next day or two there will be yet another announcement that a deal is expected after all by December 15^th and the new tariffs will be avoided.  That’s what’s happened in the past, so who knows?  Volume was above average at 7.4 billion. 

U.S. stocks retreat on economy and trade jitters

The tremendous success of the nation’s holiday weekend shopping spree was not enough to overcome today’s announcement of new tariffs on steel and, even though these tariffs are for Brazil and Argentina (not China), the message received was that Trump will allow tariffs increased against China on December 15^th. This combined with contracting manufacturing data sent the Dow plunging 268 points. The weak manufacturing was the fourth in as many months signaling a possible end to expansion which is somewhat irrational given that consensus has been that consumerism will keep the expansion going, something that was much in evidence all weekend.  Nevertheless, between that and the trade issues, investors see hindrance to growth.  At 6.8 billion, volume was exactly in line with recent averages. 

Succinct Summation of Week’s Events 11.29.19

On Friday, the reports were that Black Friday was a bust and the market sank. But over the weekend new data has surfaced that has said the opposite -- Black Friday was one of the biggest ever!  My hunch is that tomorrow is going to be a very good day for the Dow and S&P.  Below is the weekly summation and it's curious that there's no mention of Black Friday and its impact on the indexes, even though the dour outlook was triggered by the fact that there weren't that many shoppers in line outside the stores Friday morning.  It turns out much of the shopping was done online.  Anyway, tomorrow should be exciting.  Hope everyone had a great holiday weekend.