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News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

Volatility in Tech Shares Drags Market Lower (NY Times)

Stocks posted steep losses Friday, ending the week with broad declines after a report showing that job creation in the United States slowed last month.

Tesla is getting crushed — again (Business Insider)

Tesla shares are down 9%, to $160, as we head into the end of the trading session on Friday.

TSLA Chart 2/5/16 2

Another Sign of Rough Sledding Ahead: Dividend Cuts Surpass 2008 (Bloomberg)

Tightening credit puts pressure on companies to scale back payouts.

Muni bond funds providing shelter from global market mayhem (Investment News)

While the global financial markets have seemingly settled in for a fresh bout of volatility, municipal bond funds have remained relatively non-correlated to the turbulence infecting virtually every other investment category.

Inside the overall muni bond fund category, none of the 16 muni bond fund sub-categories, whether single-state or national, has a negative performance number for any period from one month to five years, annualized.

Investors dump stocks, scoop up bonds for 5th straight week (Market Watch)

Investors have been eschewing equities in favor of the perceived safety of bonds since the beginning of the year, as stock markets have taken a beating and oil prices have cratered.

Get Ready for 'iPhone Bonds' in U.S. ABS Market, Moody's Says (Bloomberg)

Your smart phone will be soon bundled into a bond.

American wireless carriers are likely to start issuing asset-backed bonds that are supported by customer payments on Apple Inc.’s iPhones and other equipment, according to a report published Friday by Moody’s Investors Service. Carriers are now increasingly selling phones through installment-plan financing that in many cases offer zero-interest rates.

The Case For A Bear Market In US Stocks Growls On (Capital Spectator)

What does a bear market for the US equity market look like? Current conditions seem to fit the bill.


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Comment by tommyt

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  1. tommyt

    the pivot points on tos just don't have enuf support lines today we need an s3 and maybe an s4 if it gets worse







Comment by tommyt

View Single Comment

  1. tommyt

    the pivot points on tos just don't have enuf support lines today we need an s3 and maybe an s4 if it gets worse







Global Shipping Rates Run Dry

 

Global Shipping Rates Run Dry

Courtesy of Dana Lyons

image

A key index of global shipping prices is nearly 50% below its previous record low level.

We swore we wouldn’t devote any more Charts Of The Day to the Baltic Dry Index (BDI) after it broke its all-time low in November. Things are really getting out of hand now, though, so it deserves at least a mention. The previous record low in the BDI was 553, set back in 1986. Upon breaking that low in November, the BDI continued to crater. As of today, the Baltic Dry Index is listed at 303.00 – nearly a full 50% below its previous all-time low.

 

image

 

So what is the Baltic Dry Index? The BDI is a composite of various global shipping rates tied to the movement of raw materials. Why is it important? It can serve as a barometer of the global trade environment, as well as a measure of inflation based on global trade. If that is the case, the trade environment would appear downright dismal.

Now, of course much of the input into the BDI comes from the price of raw materials. Considering the deflationary spiral in commodities, the drop in the BDI to all-time lows shouldn’t be a shock. However, the depths that the index is now plumbing is quite alarming and suggests trouble in the global trade picture.

It would also suggest perhaps that the deflationary pressure is not just a supply issue. Consider every prior drop in the Baltic Dry Index down to the 500-600 level. Each time, the index immediately jumped as if latent demand was just waiting for those lower prices. That development has not yet occurred this time around, even as prices are reaching 45% below the previous record low.

The Baltic Dry Index has become a trendy thing to mention in recent years when discussing global market and economic conditions. The truth is, nobody really ever knows for sure what the broader message is behind the index’s behavior. That said, this recent plunge is making it quite difficult to conceive that it means anything positive in terms of the global


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January Jobs Picture Defies Recession Chatter

Today's Disconnect: Market indexes are experiencing total "Bloodbathery," while the jobs picture doesn't look all that bad.  

January Jobs Picture Defies Recession Chatter

Courtesy of 

If there is to be an imminent recession, then jobs are an even more lagging indicator than ever.

Because this morning’s non-farm payroll report showed a continuation of two important trends: wages are rising and participation in the labor force is growing as workers come off the sidelines.

4.9% headline unemployment combined with rising average hourly earnings (2.5% growth this month) will do that. A tighter employment situation should lead to greater participation and higher pay. The mechanism is functioning.

Here are the details, via Wall Street Journal’s live blog.

As for market reaction, who the f*** knows. I’ve lost track of whether good news was bad or good at this point.

Anyone who tells you they know how the dollar, the 10-year yield or the S&P 500 are going to zig or zag off a jobs report these days is just making it up.





News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

Tech-stock wreck destroys $514B this year (USA Today)

The bad year for stocks is getting worse by the minute – and tech investors are feeling the brunt of the pain.

The 462 information technology stocks in the broadRussell 3000 index have shredded a total of $514 billion this year thanks to their average decline of 13.4%, according to a USA TODAY analysis of data from S&P Capital IQ.

Citi: 'We Should All Fear Oilmageddon' (Bloomberg)

A feedback loop of the U.S. dollar, crude, capital flows, and emerging markets.

pla screamsThe world's biggest steel maker just lost $7.9 billion (Business Insider)

Another day, another two scalps for the commodity price crash.

Two huge resources firms reported results on Friday, and you can add both to the pile of giants getting crushed by the falling price of raw materials.

ArcelorMittal, the world's biggest steelmaker, and BG Group, the FTSE 100-listed oil giant, both took big hits last year, according to financial results released on Friday morning.

European stocks becalmed as investors await U.S. jobs report (Market Watch)

Stocks across Europe sought firm direction Friday, as investors waited for the high-profile monthly U.S. jobs report and faced the prospect of a losing week for European equities.

The Stoxx Europe 600 rose 0.1% to 329.05, but has been darting in and out of positive territory throughout the session. For the week, however, the index looked solidly in the red, as it is poised to drop 3.6%. That would break two previous weeks of gains.

China's Foreign Reserves Poised for Record Drop on Yuan Defense (Bloomberg)

China's foreign-exchange reserves, already at a three-year low, are poised to post a second consecutive record monthly drop as policy makers intervene to support the yuan.

China cracks down on illegal GM crops ahead of Syngenta deal (Business Insider)

Chinese officials have issued warnings to seed dealers and farmers not to use unapproved genetically modified seeds in the country's main crop belt, shortly after


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S&P 500 Earnings Outlook: Gross

 

S&P 500 Earnings Outlook: Gross

Courtesy of Joshua Brown

Savita Subramanian’s Equity & Quant Strategy group at BAML looks at the earnings outlook trend for the S&P 500. On a monthly basis, the trend in downward revisions is the worst they’ve seen since March of 2009.

In January, the three-month earnings estimate revision ratio (ERR) fell for the fifth consecutive month to 0.49 from 0.53 — its lowest level in ten months. This remains below the long-term average of 0.84, and indicates twice as many cuts as increases to earnings estimates. The more volatile one-month ratio fell to 0.35 from 0.54, the worst since March 2009.

And before you jump up on your desk and scream “IT’S BECAUSE OF ENERGY!” you should keep in mind that estimates are being revised downward for all ten sectorsover the last 3 months, not just oil companies:

Screen Shot 2016-02-01 at 7.22.52 AM

Josh here – Two ways to think about this – positively speaking, lowered estimates means an easier number for companies to beat when they report throughout 2016. Negatively speaking, if the downward revisions are met, and then capped off by even lower estimates and outlooks, the current multiple on the market is at risk, regardless of where interest rates are. According to Subramanian, more than twice as many companies have had earnings revised downward than revised upward for the 3 month period. As for full-year 2016, EPS guidance for the S&P 500 as a whole is already down 3% since the first day of the year.

Source:

The Cuts Get Deeper 
Bank of America Merrill Lynch – January 29th 2016





Non-Farm Friday – Is America Working?

SPX DAILYWhat a crazy start to 2016!  

Of course, it is no crazier than the 3rd quarter of 2015 so far, when we had our August crash followed by a slow September bounce that led into a mega-rally that closed our year off back at the highs.  At the moment, we are playing with the premise that it's the highs that were wrong – NOT our current 1,900 level on the S&P.  We're not expecting any big rally here – just consolidation

This is nothing new, of course.  Back on December, 2nd, in: "Which Way Wednesday – S&P 2,100 Yet Again," I noted:

The S&P gets to 2,100 and we short /ES Futures at 2,100 (with tight stops above the line) and Russell (/TF) Futures below the 1,200 line and Nikkei (/NKD) Futures below the 20,000 line and then, tomorrow or Friday, I'll tell you how much money we made shorting and you'll say "why do I never catch these great trade ideas" and I'll say it's because you're not patient enough to wait for the pattern to reset itself and just make the obvious play.  

This is the 11th time the S&P has been over 2,100 since May and, so far, it's been like a little money machine for us all year long on the short side.  I know this time may be different and the last 10 times may have been different too, which is why we stop out if we don't get confirmation from the other indexes that things are toppy but, when it works – it's good for $250, $500, $1,000+ PER CONTRACT in the Futures at $50 per point to the downside. 

By the way, I know we've been talking a lot about the Futures lately and that's because our portfolios are mainly in CASH!!!  That means we have plenty on the sidelines to play with and the quick in and out…
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News You Can Use From Phil’s Stock World

 

Financial Markets and Economy

Pump jacks are seen at the Lukoil company owned Imilorskoye oil field, as the sun sets, outside the West Siberian city of Kogalym, Russia, January 25, 2016. Picture taken January 25, 2016. REUTERS/Sergei Karpukhin U.S. crude prices steady in thin Asian trading ahead of Lunar New Year (Business Insider)

U.S. crude oil futures were steady in lackluster early Asian trading on Friday as liquidity faded ahead of the Lunar New Year holiday across large parts of the region.

U.S. crude futures were trading at $31.73 per barrel at 0023 GMT, virtually unchanged from the previous close, and traders said liquidity was low due to the Lunar New Year holiday which will last for most of next week.

Lonely Yuan Bulls Say the Hedge Fund Crowd Has It All Wrong (Bloomberg)

The way most currency forecasters see it, a weaker Chinese yuan is all but inevitable.

The logo of  Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's headquarters in Tucheng, New Taipei city, in this December 24, 2013 file photo. REUTERS/Pichi Chuang Foxconn offers to invest around $5.6 billion in Sharp: sources (Business Insider)

Taiwan's Foxconn has offered to invest around 659 billion yen ($5.6 billion) in struggling Japanese electronics maker Sharp Corp, two sources with knowledge of the matter said.

Sharp has chosen Foxconn as its preferred bidder in takeover talks. One source said Sharp's board on Thursday had voted 13-0 to negotiate with Foxconn instead of a state-backed Japanese fund, the Innovation Network Corp of Japan.

Share buyback machine remains in overdrive and experts warn it will end badly (Market Watch)

In the midst of a gloomy earnings season, the share buyback machine has remained in overdrive, and some experts are cautioning it will all end badly.

Companies, even those that are missing profit and sales estimates and cutting outlooks, or restructuring and cutting jobs, are still announcing buybacks. Coming after a long period of intensive spending on shareholder returns, the news is bad for investors hoping to


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PSW’s Weekly Webinar

 

The latest PhilStockWorld.com Weekly Webinar – 02-03-16 – is up! Scroll down for a time key to the major topics. 

Major Topics:
 
00:02:16 Checking on the Markets: Russell, OIL, NG, DX
00:07:30 NEWS
00:09:58 Trade ideas
00:30:15 BAC: Stock of the year 2012, trade idea
00:39:40 Checking on the Markets
00:42:01 Exit on Futures, trade idea. Don’t pick the exit, watch the exit.
00:51:05 Options Opportunity Portfolio: Puts
00:59:15 Think or Swim. Pivot point.
01:01:56 SQQ Hedges
01:04:15 GOOG, AAPL
01:04:47 OIL
01:05:30 Checking on the Markets: YG, SI, DX, INDEX, NG, TLT, RB
01:06:41 OIL chart
01:09:56 Commodity pricing the Dollar.
01:10:24 Checking on the Markets: Russell, trade idea, AAPL, NASDAQ
01:15:38 BMY: the options are expensive. Trade ideas.
01:22:01 Checking on the Markets: Russell
01:27:00 What will happen on Monday.
01:28:43 Checking on the Markets: S&P, DOW, NASDAQ, NGK6
01:32:24 TLT
01:40:33 Next Week: China's shutdown.
01:42:08 Checking on the Markets
01:43:21 Nikkei

 





 
 
 

Zero Hedge

Is Shorting The Yuan Dangeorus?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Alasdair Macleod via GoldMoney.com,

Last Sunday (31 January) Zero Hedge ran an article drawing attention to the big names in the hedge fund community who are betting heavily that the yuan will suffer a major devaluation any time between the next few months and perhaps the next three years.

The impression given is that this view is universal, almost to the exclusion of any other.

A market cynic would point out tha...



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Phil's Favorites

PBOC Hedge Fund Battle

Courtesy of EconMatters 

The China currency debate in financial markets is rather interesting right now with many market ramifications. A rapid depreciation in the Chinese currency could lead to an Asian currency market crisis. I can see both sides of the current debate of a rapid devaluation versus a prolonged drawn out devaluation of the currency.

...

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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Volatility in Tech Shares Drags Market Lower (NY Times)

Stocks posted steep losses Friday, ending the week with broad declines after a report showing that job creation in the United States slowed last month.

Tesla is getting crushed — again (Business Insider)

Tesla shares are down 9%, to $160, a...



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Chart School

Value Investing with help from Wyckoff Logic

Courtesy of Read the Ticker.

Buying something at good value is a good approach, however it is another approach to know when to enter and exit the market, enter Wyckoff logic. If You 'know nothing' of Wyckoff logic is a good time to start.

More from RTT Tv





NOTE: readtheticker.com does allow users to load objects and text on charts, however some annotations are by a free third party image tool named Paint.net

Investing Quote...

..“The market always tells you what to do. It tells you: Get in. Get out. Move your stop. Close out. Stay neutral. Wait for a better chance. All these things the market is continually impressing...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Kimble Charting Solutions

S&P could reach 1,600 if this gives way, says Joe Friday

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

S&P 500 tops in 2000 and 2007 took place 91 one months apart. Did another top take place 91 months after the 2007 top. So far it looks very possible.

If you double that time frame, you get 182 months. What is the odds that the NDX 100 topped 182 months after the 2000 high, at the SAME price it hit in 2000?

We applied monthly momentum to the charts above, reflecting that momentum for the S&P is back at 2000 and 2007 highs and turning lower and the momentum for the NDX is back at 2000 levels.

...

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ValueWalk

Why Most Investors Fail in the Stock Market

 

Why Most Investors Fail in the Stock Market

Courtesy of ValueWalk, by  

Throughout the past 30 days of wild volatility, here’s what I didn’t do.

Panic. Worry. Sell.

In fact, the best I did was add to a couple of positions yesterday. The world was already in an uncertain state for the past 3+ years. It’s just that with the market rising, we pushed the issue to the back of our  mind and ignored it.

If you read Howard Marks latest memo, ...



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Insider Scoop

Tyson Foods' Stock Ticks Higher Following Q1 Print

Courtesy of Benzinga.

Related TSN 7 Stocks You Should Be Watching Today Earnings Scheduled For February 5, 2016 Tyson Foods beats by $0.26, misses on revenue (Seeking Alpha)

Shares of Tyson Foods, Inc. (NYSE: TSN) were trading higher by more nearly 4 percent early Friday morning after the company reported its ...



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OpTrader

Swing trading portfolio - week of February 1st, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Digital Currencies

2016 Theme #3: The Rise Of Independent (Non-State) Crypto-Currencies

Courtesy of Charles Hugh-Smith at Of Two Minds

A number of systemic, structural forces are intersecting in 2016. One is the rise of non-state, non-central-bank-issued crypto-currencies.

We all know money is created and distributed by governments and central banks. The reason is simple: control the money and you control everything.

The invention of the blockchain and crypto-currencies such as Bitcoin have opened the door to non-state, non-central-bank currencies--money that is global and independent of any state or central bank, or indeed, any bank, as crypto-currencies are structurally peer-to-peer, meaning they don't require a bank to function: people can exchange crypto-currencies to pay for goods and services without a bank acting as a clearinghouse for all these transactions.

This doesn't just open t...



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Sabrient

Sector Detector: New Year brings new hope after bulls lose traction to close 2015

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Chart via Finviz

Courtesy of Sabrient Systems and Gradient Analytics

Last year, the S&P 500 large caps closed 2015 essentially flat on a total return basis, while the NASDAQ 100 showed a little better performance at +8.3% and the Russell 2000 small caps fell -5.9%. Overall, stocks disappointed even in the face of modest expectations, especially the small caps as market leadership was mostly limited to a handful of large and mega-cap darlings.

Notably, the full year chart for the S&P 500 looks very much like 2011. It got off to a good start, drifted sideways for...



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Promotions

PSW is more than just stock talk!

 

We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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Pharmboy

Baxter's Spinoff

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).

The Baxalta Spinoff

By Ilene with Trevor of Lowenthal Capital Partners and Paul Price

In its recent filing with the SEC, Baxter provides:

“This information statement is being ...



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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 

Since...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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