Wednesday, April 09, 2014

Good news from the banks could boost the equities market.

That foundation of the banking system, commercial and industrial loans, increased at an annualized rate of 26.4% last February according to a Federal Reserve report.

Most of the data has improved - including real estate loans on line 11. Banks seem to be responding to increased business activity.

Monday, March 17, 2014

One of the most successful banks in the U.S. is the Federal Reserve. The securities that it bought during the financial crisis, among other investments, are paying off.

The Fed paid an estimated $77.7 billion to the Treasury Department last year according to a news release on its website
While this payment is less than that in 2012, the Fed has transferred funds to the Treasury every year since 1934.

Wednesday, March 12, 2014

An astute, although anonymous, reader requested the source of the odd-lot short positions. It is free on Sentiment Trader:

This contrarian index is almost unchanged since last week and suggests that investors might be able to add to their equity positions.

HOWEVER, quality spreads have been widening during the last few days. It may be wise to wait a day or so for this critical indicator to change direction before making a purchase.

Monday, March 03, 2014

This dust-up in the Crimea may provide a small window of opportunity for equity investors to add stocks.

While the yield curve and the VIX point to a lower market, other indicators disagree. Credit spreads and short sales suggest underlying market strength.

History suggests that even major political crises, such as Pearl Harbor and 9/11, drive markets down less than 10% and for less than a few days. You can find the statistics - and current market fears - in USA Today.

Tuesday, February 18, 2014

Volatility fears may be overdone. Several technical indicators for the S&P have turned positive; we are seeing upticks in both the MACD and in money flow.

The underlying strength of this market continues to be earnings growth and lack of competition from bonds. Even emerging markets are not attracting investors at the moment, so the US stock market wins by default.

This could be another good year.

Friday, January 24, 2014

Bloomberg radio host Pimm Fox brought a cast of Wall St. stars to the annual forecast dinner in CT last night. The consensus was for moderate returns in the stock market with substantial volatility. Today's market losses are validating that outlook.

This could be a difficult year for nervous investors. You will need courage to buy on these dips. However, you will probably be richly rewarded for doing so.

Monday, January 13, 2014

ETFs for the Dow and the S&P are higher in after-hours trading. They are compensating for the extreme selling that took place today when twenty-nine of the Dow 30 Industrials declined. Only MRK was up. Such broad selling is usually overdone and presents a buying opportunity.

This may be yours.

Tuesday, December 10, 2013

Is this stock market rally getting old...or getting started? The rally's fifth anniversary is coming up next spring, and my article on the New York Institute of Finance makes a projection.

Another version of the article is on The Daily Journalist.

Wednesday, November 13, 2013

Did you know that the U.S. has the world's cheapest energy? 

The WSJ quoted  Incitec Chief Executive James Fazzino in an article entitled "Foreign Firms Tap U.S. Gas Bonanza."

"If you think about the competitive advantages of an economy, having low-priced energy is about the most important," Incitec Chief Executive James Fazzino said. Combined with a stable regulatory framework and a trained labor pool, the U.S. "is really the most attractive place in the world to invest," he said.

 I will learn more about this generational change in energy at the Chartered Financial Analysts' meeting in Stamford, CT where IHS will present a panel of experts.  
Let me know if you would like copies of any handouts. 

Friday, November 08, 2013

I had the honor of guest lecturing at Sacred Heart University in a class on "Contrarian Investing." Prof. John Gerlach's students asked many pointed questions and made insightful remarks.

The ppt for the class is available to you; just let me know by leaving a comment, email, or @debweir