Wall Street ends tumultuous year near record highs

The commentary below pretty much ignores the fact that all the indexes took a modest dive on this final day of 2021 but instead focuses on providing an excellent summary of everything that happened to the market this year.  The bottom line is that the indexes have notched their biggest 3 year advance since 1999. This year the Dow advanced 18.7%, the Nasdaq 21.4, and the S&P 27 which included 70 record closes, beaten only by the 77 from 1995.  Earnings were also spectacular, blowing way past estimates in all four quarters.  Even the Omicron variant is taken as good news since it’s not as deadly and is therefore suggesting a return to normalcy.  Volume for the holiday remained well below average at 7.6 billion.  But the article deserves a complete read for the historical perspective.  Happy New Year! 

Wall Street closes down, indexes still poised for big annual gains

On the second to the last trading day of the year, all the indexes reached new record highs early in the session, then plummeted in the final half hour to close modestly in the red, the thin holiday volume being blamed for the wild price swings. The swing up was due to a drop in unemployment claims and a purchasing index of 63, well above the standard 50 that reflects expanding activity.  There was also encouragement from Fauci’s statement that Omicron should peak by the end of January. The Santa Claus rally continues but with a note of caution.  We are heading into a midterm-elections year which almost always sees volatility in the average range of a 17% correction.  So hold on to your seats.  As today’s expert put it, “Investors were pretty spoiled this year.  Be aware that next year won’t be as easy.”  As expected, volume was very light at just under 8.1 billion. 

Dow, S&P close at record highs as Omicron worries ease

The Dow closed higher for the sixth straight day and along with the S&P enjoyed another all-time high on continued strong retailing data.  Also helping the continuing rally was more good news on Omicron which is now seen as being less likely to overwhelm the healthcare system than Delta. The indexes are all on pace for the third straight year of remarkable returns supported by historic stimulus.  Volume continued below average at 7.9 billion. 

S&P 500 ends lower after four-day rally to record high

It was a day to take a breath after the startling rallies of the past few days as investors continued to weigh the impact of Omicron on disruptions and the CDC shortened the recommended isolation time for the virus. The markets are in the traditional Santa Claus rally in which the indexes rise by 1.3% during the last five days of the year and first two of the next.  Volume, as is typical of every holiday week, was well below average at 7.5 billion.  

S&P 500 scores record high on retail sales cheer

The fourth consecutive day of the Omicron rally and today it was huge, but not just because of Omicron which the market has pretty much already decided is not going to be such a big deal after all, but because the retail sales data today revealed that not only is Omicron not hurting the holiday revenue but that this Christmas season has seen a whopping 8.5% increase in sales, considerably higher than expected.  The main worry today was the travel sector with all the cancelled flights this weekend but that was overwhelmed by the other very positive data.  With personal consumption making up 70% of GDP, the economy remains flush.  All the indexes are on track for a third consecutive year of gains.  The S&P has hit a new record for annual gains at 26% but the Dow and Nasdaq are not far behind at a rise of 18 and 23 percent respectively.  As can be expected at year’s end, volume remains on the light side at 7.7 billion. 

Boom Times

To close out this Christmas weekend I thought I would spread some final holiday cheer by sharing this very optimistic graphic that Barry Ritholtz posted to his Big Picture website on Christmas Day.  It is a chart from the last 20 years showing the really substantial increase in wealth in the bottom 50% of households, most of it in the past 2 years since the pandemic.  The source is the Fed.  Believe it, don't believe it, but it's another perspective. Meanwhile, speaking of optimism, let's see if we get to enjoy the traditional Santa Claus rally during this coming week.  

Merry Christmas!

Merry Christmas!  That's all I have tonight. I'm sure on this day of celebration and family togetherness, that's all anyone wants.  Anyway, that's all I have the energy for.  Good luck on Black Sunday.  

New Market Risks

Consuelo Mack in her WealthTrack program today is rerunning a recent interview that is of note as she picks the brain of Wall Street guru Rick Bookstaber as he shares his sentiments about coming risks in the market.  This is partly inspired by long-running prognostication from another guru, Jeremy Grantham, who has long been predicting calamity, something I'm skeptical about given the fact that calamities are almost always preceded by long periods of bad market and economic fundamentals and the fundamentals for the past few years have actually been quite strong.  But everyone's entitled to their opinion, and we are all entitled to consider different perspectives.  Merry Christmas!  

U.S. stocks end at record high, oil prices rise as Omicron fears abate

A third consecutive day of Omicron rallying saw all the indexes up substantially again, all on optimism that Omicron is leading to far less hospitalizations than delta, and that data showed the economic backdrop to be on a very strong footing.  Investors once again pulled money out of the safe haven defensive sectors and back into “risk-on” cyclical recovery stocks and the tech growth stocks.  The S&P is still up 26% for the year and, given the holiday week, volume was again considerably below average at 8 billion shares traded. 

U.S. stocks close up as Omicron fears fall; 'Santa Claus rally' may be muted

It was a second day of the Omicron rush as new confidence in overcoming fears that the new variant will have an impact on the economy pushed all the indexes higher again as investors concluded “It may not have as much of an impact.”  Further validation came from Biden’s statement that there will be no new lockdowns.  Also helping were reports that the White House was entering into new negotiations with Manchin so the big bill that Wall Street and industry wants may not be dead after all.  There is still caution though that the traditional “Santa Claus” rally that happens most every year may be less pronounced this time around.  Being so close to the holiday, volume too was less pronounced at 8.6 billion. 

Wall Street posts robust gains at close with boost from Nike, Micron, following Omicron slide

Yesterday I was trying to make a dramatic point about the power of single individuals for both good and harm, so deliberately did not point out that part of the day’s rout was more panic over Omicron.  Today we learned that Omicron, though spreading rapidly, appears to be not nearly as threatening as previously feared, that those who are fully vaccinated, though there may be many breakthrough infections, have little to fear in terms of hospitalization and death. So today all the indexes soared as the recovery stocks such as energy and travel all were top percentage gainers.  As today's expert put it, "We're going to be able to ride through this Omicron surge and come out the other side in pretty good shape."  The S&P is again up nearly 24% for the year with just a handful of trading days left.  Volume was 10.1 billion, below the 4-week average. 

Wall Street skids on Omicron worry, hit to U.S. investment bill

So this is what happens when a certain U.S. Senator withdraws his support from a crucial bill.  The Dow and Nasdaq drop like stones (attributed by Wall Street analysts to this man), Goldman Sachs trims it 2022 GDP forecast after his comments. The economic recovery groups take the biggest declines including financials and materials. Investors go on defense putting money into the safe sectors of consumer staples, real estate, and utilities.  11.4 billion shares change hands in this wild sell off.  One man did all this.  What will tomorrow bring? 

7 Best Stocks to Buy Now With $1,000

For the final Sunday before the holidays begin I submit this week's edition of U.S. News Invested with their recommendations of the best stocks that can be purchased right now for a thousand dollars or less.  Hope everyone enjoyed the weekend.  

Great Investor Stocks

This week's edition of Wealthtrack is particularly appropriate coming into the holidays as she interviews Bill Miller, head of Miller Value Partners.  He discusses his own holdings, particularly in bitcoin (a subject that remains a complete mystery to me) but also focusing on the current market in general and the  values he's finding in it.  Tomorrow, I will present an article from U.S. News Invested about the best stocks to be buying for 2022.  Enjoy the rest of the weekend.  It's going to be sunny tomorrow. 

S&P 500 ends down after mostly negative week

The third day after the Fed announcement and investors are still digesting the impact of the end of bond buying and the start of new rate hikes resulting in another day of losses in all three indexes, and with Pfizer forecasting an extension of the pandemic, the cyclical Dow stocks got hit particularly hard.  The Omicron news was also not good with the new variant now determined to be 5 times more contagious than the already super-contagious delta, and the vaccines being less effective against it.  It all added up to more uncertainty than is usual for this already uncertain market.  But chin up.  This happens practically every day now.  One day there is optimism, the next fear.  Volume was way up due to options expirations so Monday will tell the true story. 

Nasdaq ends sharply lower as investors dump growth stocks

Yesterday there was elation when the Fed announced the end of bond buying and the start of rate hikes, all in the interest of taming inflation, something investors very much wanted.  Today the markets took more time to digest the reality that rate hikes would impact the tech stocks and thus there was a sweeping exodus away from tech and back towards value. A more hawkish Fed and continued pandemic fears translates to a lot of uncertainty going into 2022.  The good news is that the S&P is still up 25% for the year and the VIX has dropped to a 3-week low.  Volume came in at 11.9 billion. 

Wall St ends higher; Fed to end bond purchases in March

The news from the Fed today was even better than expected and all three indexes reacted with a huge rally bolstering the Dow 383 points and the Nasdaq 327.  The Fed will not begin tapering next year but will actually end the bond purchases in March and have not one but three rate hikes by the end of 2022.  This is what investors wanted as both moves will signal a normalization of inflation sooner rather than later. The S&P also had a sharp rise recovering almost all of its losses from earlier this week.  All the sectors, both value and growth, jumped with semiconductors leading the way at 3.7 percent.  Volume was a little above average at 12.2 billion. 

Wall Street ends lower, investors eye inflation and Omicron

With the producer price index (+9.6%) soaring to its largest gain since 11 years and 2/3 of Nasdaq stocks trading below their 200-day moving average, there was again a flight out of equities and especially out of tech as investors await Wednesday’s Fed meeting for some clarity on inflation. The tech leaders like Microsoft and Apple are the ones that drew down the most and, as today’s expert put it, “When the leaders sell off, it’s not a good sign.”  Financials gained betting the Fed will take a hawkish position and it is widely expected that there will be modest rate hikes in Q3 next year. Awaiting the news from the Fed, volume was a little below average at 10.8 billion. 

Wall Street ends down; investors eye Omicron and Fed meeting

After a few sessions of the market feeling more confident about the Omicron variant, fear took over again today with the virus spreading suddenly like wildfire in London and recording the first death, with much more expected to come. So just as there was a big rally on the leisure stocks last week, today there was a great exodus from them and a rush back into the defensive sectors of consumer staples, utilities and real estate.  In its monthly meeting that starts Tuesday, the Fed is expected to adopt a more hawkish tone regarding a wind-down and economists see a ¼ to ½% rate hike in Q3 2022.  Volume was more elevated at 10.8 billion shares traded. 

Powerful Economic Forces

This week's WealthTrack program covers the topic of "Powerful Economic Forces" in which Wall Street guru Ed Hyman outlines the major forces influencing the economy and stock market during the past year (all of which he accurately predicted last year) and gets out his crystal ball in sharing his expectations for 2022.  Hope everyone enjoyed the nice sunny breezy weekend.  More sun and breeze coming too.  

10 of the best blue-chip stocks to buy for 2022

For your weekend reading, I submit this week's edition of U.S. News Invested since, as investors have been flocking back to the blue chips of late, here are their top 10 picks for 2022.  All are solid names.  Enjoy the weekend.  

Wall St gains, S&P hits record closing high as CPI meets expectations

Though today’s CPI report was not all that great, it was nonetheless in line with expectations and taken by investors as signaling a peak rather than a sustained level. As the high CPI number is attributed largely to supply chain issues which are taken to be temporary and the data even suggests that the problem could be easing and inflation could be shrinking, all the indexes got another considerable boost with the Dow up 216 points.  Despite the media portraying the inflation problem as dire, the market at least sees it as getting solved in the foreseeable future and expect any Fed hikes to be modest.  Investors won’t mind that, preferring a hike and Fed tightening to more inflation.  Volume remains below average at 9.6 billion. 

Wall Street closes lower ahead of inflation data, Fed meeting

The Dow was the only index today to make it at all in the black but lost even that much by close.  The Nasdaq took a much bigger hit as investors took profits after a 3 day relief rally and flocking back to cyclicals. One bit of good news is that new unemployment claims came in at their lowest in 52 years, though economists point to current labor market figures as misleading due to the large numbers who have dropped out of the market.  Today’s selloff was also likely due to caution preceding Friday’s CPI inflation data.  Will the Fed be doing a rate hike next year or not?  Volume was below average at 9.7 billion. 

Wall St closes higher as vaccine update feeds optimism

The Dow spent most of the day heavily in the red until the late news of the Pfizer vaccine offering protection against Omicron triggered a comeback and a close modestly in the black. And it became another risk-on day with investors continuing the migration back to tech, favoring quality growth stocks over cyclicals. The market now believes that it won’t take much to tame inflation and thus any coming rate hikes are likely to be modest, which provided another boost to equities. The S&P, falling 4.4% during Thanksgiving week due to the Omicron panic has today regained almost all its lost ground, being now less than one point below the pre-panic close.  With the positive vaccine news, the S&P travel stocks were the biggest gainers.  Volume was a little below average at 10.3 billion. 

Wall Street closes higher with Nasdaq boosted by tech rally

It was another high flying day as investors got some relief from Omicron anxiety with some additional reassuring remarks from Dr. Fauci.  This time all three indexes got a big boost as good pandemic news from drugmaker GSK sent everyone flying back to tech but relief continued to flow into the Dow cyclicals as well and the VIX went down almost 50% to its lowest reading since October 6^th after last week’s 10 month high.  Leisure and airline stocks rose but semiconductors got the biggest boost.  And a really big boost for GSK and Vir Biotech when they announced a new drug therapy effective against Omicron. At just under 11.4 billion, volume was once again very close to the 4-week average. 

Wall Street regains some ground with help from easing virus fears

It was another big day of gains with investors continuing to flock back to the cyclical and sensitive stocks on optimism from Dr. Fauci  that Omicron “does not look like there’s a great degree of severity to it.”  The Dow jumped 646 points and has now regained most of the ground lost during last week’s Omicron panic.  The S&P is now just 2.3% below where it was before the panic struck.  Value (the blue chip cyclicals) is again outperforming growth (tech.)  The hope is that if the cyclicals continue to do well it will boost confidence in the rest of the market. But the best indicator that the panic is behind us is that volume, for once, is close to the 4-week average at 11.9 billion. 

7 Best Cyclical Stocks to Buy Now

Since the cyclical stocks are the ones that took off this week (after such a dunking all the indexes recently had) I thought I'd share this latest issue of U.S. News Invested detailing the 7 cyclicals that they most highly recommend.  They're all solid and, by clicking on the link at the bottom, you'll see the entire write-up with detail on each stock.  Hope everyone had a great weekend.  

Making It On Wall Street + Niall Ferguson

As we approach the holiday, this week's edition of WealthTrack seems particularly appropriate. The first half of the program focuses on the rare breed (11%) of Wall Street managers who are women and how they got there. The second half provides some historical perspective as the first of a 2-part interview with Niall Ferguson who has authored 16 books on money and investing, focusing on what history has to teach us about geopolitical and economic risks covering many centuries and culminating in the current pandemic crisis.  Enjoy the weekend.  

Nasdaq dives over 2% as tech stocks slide at end of volatile week

It was another Omicron panic-driven day with the Dow down some 500 points (and the S&P down proportionately) until the final hour when everything rebounded and all but tech closed with only modest losses.  But everyone fled tech today with the major players all falling and the rest of the sector falling with them on fears of a more aggressive Fed and everyone taking on the more tradition cyclical stocks near the session’s end.  Payrolls increased less than expected but wages increased and unemployment reached an almost two year low point.  All in all, the positive data suggested a very strong economy which is the reason cyclicals became more attractive and the Fed is considering a wind-down which in turn pulled investors away from tech.  We were back to abnormally high volume again at 14.0 billion. 

Wall Street ends higher in robust rebound from Omicron-driven rout

My oh my what a rollercoaster we’re on. Panic over Omicron caused the big crash last Friday, then relief over same caused the rally on Monday.  More major panic Tuesday and Wednesday but today everyone thinks things are going to okay after all and thus another huge rally as investors pick up bargains.  Most of the rush was back into the cyclical sectors shooting the Dow up 617 points with the airlines index, industrials, energy and financials reaping the biggest gains.  Friday’s employment report, as always, is hotly awaited, and expected to be good news. The Dow had its best day since March 5^th. Another sign that the panic is subsiding is that volume at 12.8 billion, though still above average, is nonetheless way below the huge numbers we’ve seen in the last few sessions. 

Wall St turns red as Omicron reaches the United States

The day actually got started with a boom with the Dow up some 500 points (as well as the other indexes) due to a generous amount of positive economic data.  Then the Omicron fears set in again and, with the CDC announcing the first U.S. case surfacing in California, it was another huge rush to the exits and to safe haven investments like utilities which was the day’s only gainer.  Then Powell today reiterated his comments from yesterday that the spike in inflation will now likely endure through all of 2022.  The VIX climbed to its highest since February and the Dow closed below its 200 day moving average for the first time since July.  All in all, it was another major bath with corresponding huge volume at 14.2 billion.  The panic continues.