Stocks Poised For Serious Shock

Okay, I will fully admit that so far this year, I have been wrong regarding the markets.  I have been expecting a correction for several months – since February – and the market has continued to drive to new highs, with only a few minor pull-backs.  One could argue that if I just keep calling for a correction, eventually I will be right.  I would agree with that in principle,…

Earnings Reports, Key Economic Data Will Drive Stock Performance This Week – Published in Noozhawk on Monday, April 29. 2013

This week will be one of the busiest of the first quarter 2013 earnings season, with 130 of the 500 Standard & Poor’scomponents reporting earnings, or 25 percent of the index. In addition, we will have the Federal Reserve meeting Wednesday, and on Friday reports on March employment and consumer sentiment. With so much data to parse, stock investors will have plenty to think about, testing the wisdom of the old adage: Sell…

U.S. Adds a Disappointing 88,000 jobs in March; Stock Plunge

Stock futures are off by more than 1% after the jobs report showed a much lower than expected 88,000 jobs were added in March.  Economists had expected 200,000 jobs for the month.  The unemployment rate fell slightly, from 7.7% to 7.6%, but this is due to the methodology used to calculate that number, so no one is placing much emphasis on this number. The economy in general bounced back from…

Stocks Set New, All-Time High, But Now What? – Published in Noozhawk on Monday, April 1, 2013

Stocks ended the first quarter of 2013 with very strong performance, setting a new, all-time high for the Standard & Poor’s 500 on the final trading day of the quarter at 1,569. The Dow was the best performing of the three major indexes, gaining 11.3 percent to log its best quarter since 1998. The S&P 500 gained 10 percent for the quarter, almost matching the index’s 12 percent gain in the first quarter of…

Stocks Rally To New All-time Highs – Stance: Cautious

I have been raising cash for a few months and now hold significant cash balances for portfolios.  Stocks have continued to advance this year, after the Fiscal Cliff debates resulted in a somewhat palatable solution, at least, it appears, palatable to many investors, even if not to me.  Today stocks have pushed the Dow to a new all-time high.  From a technical analysis perspective we will need to close above…

Three Reasons Why Stocks Should Correct – Published in Noozhawk on Monday, February 4, 2013

With the stock market closing last week at multiyear highs, and very close to all-time highs, investors may question whether this rally can continue. I see three major reasons to believe it won’t. The Dow ended 2012 at 13,104 and ended January at 13,860, resulting in a powerful start to 2013 and a gain of 5.77 percent for the month. The Standard & Poor’s 500 also had a strong start to the year, gaining…

Market Perspective: Long-term Outlook for Stocks Is Positive

As you know if you read my blog often, I am very cautious on the financial markets today.  I believe bonds are in a bubble and that stocks, which are at multi-year highs, are overvalued and due for a correction.  My concerns are further enhanced by the pending debate in Congress over the spending cuts, which they will attempt to address in February.  Keep in mind that the entire month…

Small Investors Get It Wrong (Again)

There is a widely held belief, which is backed by significant research, that small investors are usually wrong, meaning they buy when they should sell and sell when they should buy. This usually occurs because, at times when stocks are usually the most attractively priced, conditions are very scary: the economy is weak, corporate earnings are down, there is a lot of uncertainty, etc. At times like these, small investors…

Fiscal Cliff Hangover Not the Only Challenge We Face – Published in Noozhawk on Monday, January 7, 2013

The agreement Congress approved to avert the “fiscal cliff” — the expiration of the Bush-era tax cuts and spending cuts that resulted from the debt ceiling debate of 2011 — was more of a kick-the-can Band-Aid, rather than a true solution. The resulting push of spending cuts for two months, and the looming debt-ceiling debate, set the stage for the real war of wills within Congress and with President Barack Obama. In the…

Is There Reason for Optimism after the Fiscal Cliff? – Published in Noozhawk on Monday, December 17, 2012

For weeks, most financial pundits, including myself, have been writing about the perils of the fiscal cliff — the expiration of the Bush-era tax cuts and the implementation of significant spending cuts set to go into effect Jan. 1. The combination of tax increases and spending cuts, worth about $800 billion if implemented, is expected to drive the U.S. economy back into recession early next year. Congress and President Barack Obama continue to grapple…