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Weekly Market Recap Sep 10, 2017

Courtesy of Blain.

The holiday shortened week started with a bout of moderate selling but things were largely quiet in the indexes after that.   The debt ceiling turned into a nothing burger – we didn’t even get the normal rhetorical circus out of D.C. before they kicked the can forever down the road – boo!   So we’ll be back at it circa mid December when they wave their hands in faux outrage as they raise it again.

One note on the Federal Reserve – Vice Chairman Stanley Fischer plans to resign from his post in mid-October. His term was set to end in June.

Across the pond, the European Central Bank (ECB) left key interest rates unchanged, while Mario Draghi indicated that the decision on how to taper a quantitative-easing program will come in October.

Not much to note in economic news but Wednesday ISM services came in at 55.3 for August, compared with 53.9 in July – so a nice rebound there. A reading of at least 50 indicates expansion.

For the week the S&P 500 fell 0.6% while the NASDAQ pulled back 1.2%.

While the hurricanes are obviously terrible for those involved, they actually will be a boost to the economy as we move ahead.  That said google “broken glass fallacy” when you have a moment.

As devastating as the hurricanes are, they are likely boost the economy, according to New York Federal Reserve Bank President William Dudley.  “The long-run effect of these disasters, unfortunately, is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms,” Dudley said in an interview with CNBC.

“I would expect that by the time we get to the end of the year and early 2018, the transitory negative effects of this storm I think will be over and we actually will start to see some of the benefits of the rebuilding efforts in terms of boosting the economy,” Dudley said.

Remember when everyone hyped the “strong dollar” Trump would bring post election?  Not so much – this past week was the worst since May.

Here is the 5 day weekly “intraday” chart of the S&P 500 .. via Jill Mislinski.

Fun chart of % of GDP of global powers over the last 2000 years – obviously record keeping in 180 AD was not the greatest, so some estimation going on.  It is interesting to see how powerful India was for a long time.

The week ahead…

Back to a full work week.   Some not so market moving economic data but retail sales (0.1%) out Thursday is one to watch.   Apple is set to unveil its latest products including a new iPhone model on Tuesday.

Index charts:

Short term: The major indexes had broken a downtrend the prior week, and then last week sort of held serve.

The Russell 2000 remains the weakest of the big 3, as it has all year – now back below the 50 day moving average.

The NYSE McClellan Oscillator remained positive while the indexes consolidated.

Long term: Back to the 5 year charts – it’s been all unicorns and butterflies for bulls obviously for a long while.

Charts of interest / Big Movers:

Tuesday, this week’s winner in the biotech lottery was Insmed (INSM) which rocketed 120% after the biotech firm said its study into NTM lung disease met its primary endpoint and it now plans to request a priority review and accelerated approval.

Wednesday, Trivago (TRVG) – which drives many of us crazy with their incessant commercials – plunged 16% after the German hotel search platform cut its guidance, saying earnings for the third quarter and full year would be lower than previously expected.

Dave & Buster’s (PLAY) got busted by 12% after its second-quarter results disappointed vs Wall Street expectations and the company trimmed its fiscal full-year outlook late-Tuesday.

Thursday, GoPro (GPRO) rallied 12.4% after the wearable camera maker said it expects to be profitable on an adjusted basis in the third quarter.

RH (RH) soared 45% after the upscale retailer formerly known as Restoration Hardware reported earnings that topped Wall Street estimates late Wednesday.

Friday, Equifax (EFX) tumbled 14% after the company late Thursday disclosed that personal data of 143 million Americans, including Social Security numbers, driver’s license numbers and credit card numbers, had been exposed in a hack.

Have a great week and we’ll see you back here Sunday!


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