Morning Comment: Yield Curve Showing Signs It Could Steepen


  • The stock market’s nice rally from early June has actually flattened out quite a bit recently.
  • At some point, renewed “trade talks” are going to be viewed as the boy who cried wolf.
  • Semis breaking slightly above old highs…Any further upside follow-through will be quite bullish.
  • The early reaction to the DOJ’s new “antitrust review”: Surprising complacency.
  • The yield curve is showing signs of reversing.
  • If it steepens, it’s obviously going to have a BIG impact on groups like the banks & utilities.


Nice rally, but has been flattening out recently

News flash…earnings are coming-in better than expected!!! Of course, they have been better-than-expected every quarter since God was a child…because the estimates are always lowered enough so that they can be exceeded…but it does give something for people to talk about whenever the market rallies on a given day during earnings. Don’t get us wrong, the percentage of companies beating estimates is higher than usual. It’s about 80% so far vs. the usual number in the low 70s…but we’d also highlight that the stock market really hasn’t done anything over the past three weeks. So the reaction to the earnings season really hasn’t been anything special so far.

Actually, even though the estimates are always lowered enough that they can be exceeded, sometimes stocks SHOULD rally on better-than-expected earnings. However, that’s only when the stock market goes down at the same time the earnings estimates decline before earnings season. When the stock market RALLIES strongly in the 6-7 weeks leading up to earning season (like it did this time around)…while those estimates are coming down…it makes it difficult for stocks to sustain much of an “earnings rally.”

Earnings did not get all of the credit yesterday, however, as the market shot-up after a headline hit the ...

Read More
Comments

Morning Comment: Can TXN Fuel a Breakout in the Chip Stocks?


Pretty uneventful day in the market yesterday

The stock market saw a mild rally yesterday...on very low volume and breadth that was flat. Of course, we will certainly continue to see some big earnings-related moves on individual stocks going ...

Read More
Comments

The Weekly Top 10: The Key Investment Issues for the Upcoming Week & Beyond


In the weekend version of my newsletter, Beyond the Fundamentals Now (BTFNow.com), I try to focus on issues that most people are not focusing on...and look at the mainstream issues from a unique angle. In the full premium ...

Read More
Comments

Morning Comment: The Fed is Scared....Can the SMH Breakout?


  • The Fed's Williams walked back his extremely dovish tone, but.....
  • What does the Fed know that the rest of us don't know?
  • "Insurance" rate cuts have an uneven record of success.
  • That said...the chip stocks act well ...
Read More
Comments

Morning Comment: Big Momentum Shift for NFLX?


  • CSX raises serious concerns about the economy.
  • Gold is overbought, but still has a lot of upside potential.
  • NFLX: Below $320, the stock has little downside support.


Rough day yesterday, but no major concerns (yet).

It was a pretty rough ...

Read More
Comments

Morning Comment: When The Fed Speaks, Sometimes It's Pure BS

The Fed tends to sugarcoat their explanations.

We have great respect for the Fed and its individual members. However, sometimes when they speak, they are full of baloney. A better way to describe my feelings is to say that I ...

Read More
Comments

Morning Comment: A technical look at GS, JPM & CSX.


Boring day yesterday, but earnings should change all that

It was quite an uneventful day yesterday in the markets…as we saw little movement in stocks and bonds…as well as in crude oil, gold, the dollar, etc. There was some minor ...

Read More
Comments

Morning Comment: Market Overbought as Earnings Season Begins


Recent late-day rallies are bullish

The stock market advanced further into record territory on Friday…as the Fed’s dovishness continues to fuel the rally. Friday’s gains came on meager volume (less than 2.4bn shares in the composite volume). It also ...

Read More
Comments

Morning Comment: Powell Confirms an "Insurance" Rate-Cut


I'm surprised we didn't rally more yesterday

I must admit, I was surprised that the stock market did not rally more than it did yesterday. Chairman Powell certainly did not do anything to change expectations about a July ...

Read More
Comments

Morning Comment: Earnings DO matter.


Weakening economy? Trump has nobody to blame but himself.

Needless to say, the focus today will be on Chairman Powell’s testimony in front of Congress…which begins at 10:00. Of course, President Trump is desperately trying to pressure the Fed ...

Read More
Comments

Morning Comment: Nasdaq at key juncture as well.


Stocks repriced Friday's reaction to the NFP report yesterday

The stock market saw a bit of a decline yesterday….and when you combine that move with the decline in the S&P futures this morning…and we have a situation where ...

Read More
Comments

Morning Comment: Waiting For Godot (and Chairman Powell)


Waiting for Powell (and then earnings)

The activity in the stock market was obviously very low on the Wednesday and Friday surrounding the 4th of July…and it’s a good bet that things will remain that way over the next ...

Read More
Comments