Posts Tagged S&P 500
Bounce Or New Beginning?
Posted by Tetyana Matychak in Fund Markets on August 31st, 2010
Although it was one of the last summer Friday’s, trading was surprisingly volatile. Despite the fact that most traders were likely working on their short game or vacationing with the family, there was a serious dose of data input to the game on Friday ranging from economic results, corporate guidance, and of course, some very important Fedspeak. The end result was an impressive move up in the indices, which may or may not represent a new beginning for the bull camp.
While the bears could be heard making remarks about short-covering and discussing the height to which a dead cat could actually bounce, the bulls talked about a second successful test of 1040 and a move “into the gap” that was created by Tuesday’s opening dive lower. And while no one knows for sure how much farther the bulls can run, it does appear that our heroes in horns were able to wrestle the ball away from their opponents on Friday.
There were three key inputs to the session. First, we had the first revision to the second quarter GDP in the U.S. While down significantly from the initial estimate made earlier in the month (remember, the government’s first estimate didn’t even include all the data from the final month of the quarter), the growth rate of 1.6% was actually better than the consensus for a rate of 1.3% and the whisper numbers containing a zero-handle. The takeaway from the report was that although the growth has indeed slowed, the economy does continue to grow. And in short, this is what “slowdowns” look and feel like.
The next bit of data was less upbeat as Intel (INTC) revised its revenue guidance for the third quarter – and not in a good way. Although analysts following the chipmaker suggested that the move wasn’t exactly a surprise, the computers that look for key words were able to put “Intel” and “reduced guidance” together in order to create a swift downdraft. It is also interesting to note that the Intel news was released within a couple minutes of the University of Michigan’s Confidence index, which, while not a bad report by any stretch, also came in “below consensus.” As such, the computers clearly got busy for a period of about 10 minutes Friday morning. Read the rest of this entry »
Investing In South Korea: Why This Emerging Market Is A Perfect Contrarian Opportunity
Posted by Tetyana Matychak in Investing on August 27th, 2010
The mere mention of this country’s name can cause the “Risk-o-Meter” to nudge higher. But it’s got nothing to do with the nation’s own economy or growth prospects.
Rather, the problem resides to its immediate north in the shape of the contentious Kim Jong-Il and the saber-rattling North Koreans. Their South Korean neighbors live with the constant threat of violence erupting at any moment – especially after North Korea allegedly torpedoed one of South Korea’s warships in March.
But the likelihood of a full-blown war is slim. Why? Because the United States still has some 28,500 troops in South Korea. And thanks to the long-standing U.S.-South Korea alliance, any North Korean attack would effectively be an attack upon the United States, too.
Even Kim Jong-Il knows that’s a bad idea and would end disastrously for his rogue nation.
And for investors, the overblown geopolitical climate is just one reason why I’m convinced that now is the perfect time to buy into this contrarian situation. But there are more… Read the rest of this entry »
U.S. stock futures rise ahead of Bernanke testimony
Posted by Tetyana Matychak in Fund Markets on July 21st, 2010
U.S. stock futures rose on Wednesday, buoyed by Apple’s stronger-than-expected results, as investors braced for testimony by Federal Reserve Chairman Ben Bernanke and another barrage of earnings reports.
Nasdaq 100 futures gained 11.75 points to 1,851.50 and S&P 500 futures added 4.40 points to 1,084.50. Futures on the Dow Jones Industrial Average rose 31 points to 10,210. The Dow (DJIA 10,230, +75.53, +0.74%) ended up 0.7% on Tuesday, reversing intraday triple-digit
losses.
Sentiment was buoyed after Apple (AAPL 251.89, +6.31, +2.57%) reported last night a surge in earnings due to booming demand for its iPhone and iPad devices.
Strategists at Deutsche Bank said the spotlight Wednesday will be on Bernanke’s monetary policy report to the U.S. Senate Banking Committee.
“Expectations that Bernanke may announce policy accommodation measures seemed to help risk assets recover from the softer housing-starts data and Goldman Sachs’ earnings and revenue miss,” they wrote in a note. Markets will “likely listen carefully to decipher any hints about the possibility of a U.S. double-dip [recession].”
Bernanke will start speaking at 2 p.m. Eastern time, but before that investors will get a number of earnings reports from companies, including Morgan Stanley (MS 25.22, +0.44, +1.78%) , Wells Fargo & Co. (WFC 25.91, -0.11, -0.42%) and Freeport McMoRan Copper & Gold Inc. (FCX 64.32, +3.46, +5.69%) . Read the rest of this entry »
Stocks May Surprise By Year-End
Posted by Tetyana Matychak in Favourites, Fund Markets on July 5th, 2010
Economic news has been weak lately. Financial markets have performed poorly for over two months. Dow Theory “sell signals” have been issued. You may have heard a “death cross” is on the way. It is nearly impossible to find a bull among the growing sloth of bears. We are concerned about both the fundamentals and the technicals. However, in the context of history the current situation is not all that unusual.
On the economic front, the Wall Street Journal helps put recent weak economic numbers in some perspective. Stocks did quite well from late 2002 to late 2007. They also did well from 1992 to 1994.
Pauses aren’t uncommon early in a recovery. After rebounding from recession in late 2001 and early 2002, the economy had a 12-month stretch in which it grew at a paltry 1.5% annual rate, sparking fears of a double-dip recession. In late 1991, growth waned after a recovery had started. In the past 12 months, the economy has gotten off to a faster start than in 2002.
From CNBC: Former Federal Reserve Chairman Alan Greenspan said that the recent stock market decline is “typical” of a recovery, and that international instability has more to do with the recent decline than problems in the United States. “What we’re looking at is an invisible wall, which we’ve run into here. Which, essentially, as far as I can see, is a typical pause that occurs in an economic recovery,” Greenspan said in an interview with CNBC. “Ordinarily we’re saying that the stock market is driven by economic events, I think it’s more in the reverse.” Read the rest of this entry »
4 Investment Ideas That Provide Income
Posted by Tetyana Matychak in Investing on July 1st, 2010
As of this moment, the S&P/TSX Composite index is down 384.58 point or -3.27% year to date. The S&P 500 is down 67.32 or -6.04% year to date. That is your market update. When the global economic outlook appears uncertain and on the brink of another recession, equity markets reflect this reality in terms of greater than normal volatility. In markets like these, what we should be looking for are non-correlated assets and managers that have demonstrated the expertise to preserve capital during uncertain times like today.
In addition, one should also be focusing their efforts on receiving some form of income while the economic climate sorts itself. The following 4 ideas should hopefully accomplish both those goals. While we cant speak to the best/worst time to buy/sell particular securities, as that depends on one’s personal circumstances, the approach we usually take, especially with closed end funds, is to purchase them when they are trading at the steeper than normal discount to their Net Asset Value (NAV). The only other thing we would like to add is that you should do you own due diligence.
Trident Performance Corp.
This closed end fund is managed by CI Investments. Its investment objective is to provide tax-efficient risk-adjusted long term rates of return by obtaining exposure to a Global Macroeconomic Portfolio, advised by Trident Investment Management. Co-Founded in 1998, by Nandu Narayanan, Trident Investment Management seeks to exploit macroeconomic trends to generate attractive risk-adjusted rates of return with low or negative correlation to traditional ‘long’ investments. This is exactly what Mr. Narayanan did during the financial crisis, when the CI Global Opportunities Fund recorded positive performance of 109% in 2007 and 42.6% in 2008. Since inception in March 1995, the fund has averaged 19.69% as of the end of May 31, 2010. Read the rest of this entry »
Hedge Funds May 2010
Posted by Tetyana Matychak in Investing on June 30th, 2010
The latest hedge fund performance and investor allocation data for May 2010 show that last month indeed was a tough one for hedge funds. The Hedge Fund Aggregate Index was down but did not fall as hard as the S&P 500. Total hedge fund assets fell almost 3% in May.
The HFN Hedge Fund Aggregate Index was -2.86% in May 2010 and +0.89% year-to-date (YTD). The S&P 500 Total Return Index (S&P) was -7.99% in May and -1.51% YTD.
Total industry assets fell an estimated -2.82% to $2.234 trillion in May. Despite performance based asset reductions, net investor flows were positive for the fifth month in a row.
Performance accounted for $66.87 billion of the decrease and investor allocations accounted for a net inflow of $2.13 billion. Net inflows were the lowest since January and the second month in a row of slower rates of increase.
The core rate of growth (% asset change due to investor allocations/redemptions) was an increase of 0.09%, the second slowest rate of increase since HFN began tracking asset flow data in Q4 2003. Read the rest of this entry »
Stock investors ask: What’s the next big thing?
Posted by Tetyana Matychak in Fund Markets on March 11th, 2010
A year after the stock market began its comeback from 12-year lows, investors are looking for the next big thing.
Stocks have lost some of the momentum that propelled the Dow Jones industrial average up 61.4 percent from its close of 6,547 on March 9, 2009. That’s natural – bull markets tend to slow down as they head into their second year. But the lethargic pace of the economic recovery has also been a bit of a drag on stocks. And so investors are waiting for signs that the economy is ready to put up some solid, sustainable growth numbers.
The most likely trigger: job growth. Investors need to see a Labor Department report that says employers are creating more jobs than they’re cutting.
Until then, investors are going to stay cautious. Analysts say the market is likely to move sideways or drift higher, as it’s been doing over the past few weeks. Tuesday’s trading fit the pattern of modest moves. The Dow rose nearly 12 points. The average is up 1.3 percent so far this year.
But that doesn’t mean the market isn’t going to have its fitful moments. And it certainly has volatile industries that are expected to move the rest of the market. On Tuesday, the financial companies that led stocks higher in the past year again drove trading. Analysts said financial shares rallied as investors reacted to rumors that the government might prohibit the trades known as short sales in stocks of companies it owns. The government has large stakes in Citigroup Inc., American International Group Inc. and mortgage companies Fannie Mae and Freddie Mac after bailing them out during the 2008 financial crisis. Read the rest of this entry »
Stocks Climb on Evidence Global Economy Recovering
Posted by Tetyana Matychak in Fund Markets on December 23rd, 2009
Stocks rose around the world, driving Europe’s Dow Jones Stoxx 600 Index to a 14-month high, on evidence that the global economy is recovering from its recession. Oil and copper advanced.
The MSCI World Index of developed-nation shares climbed 0.3 percent at 9:41 a.m. in London. Futures on the Standard & Poor’s 500 Index added 0.3 percent and the MSCI Asia Pacific Index increased 0.5 percent. Oil gained 0.6 percent in New York, while the dollar traded near a three-month high against the euro.
U.S. consumer spending probably rose in November for the sixth time in seven months as households took advantage of holiday discounting, economists said before reports today. China’s growth may surge to as much as 12 percent next year, according to Citic Securities Co., the nation’s biggest listed brokerage. Consumer confidence in Italy unexpectedly rose in December to the highest in more than seven years after Europe’s fourth-biggest economy emerged from a recession.
“The path of least resistance will continue to be to the upside,” Robert Doll, who helps oversee about $3.2 trillion as chief investment officer for global equities at New York-based BlackRock Inc., said in a Bloomberg Television interview. The economic recovery “means earnings should be somewhat better and liquidity should still be plentiful. That’s a recipe for equities moving higher,” Doll said. Read the rest of this entry »
Asian Stocks Fall to Two-Week Low
Posted by Tetyana Matychak in Fund Markets on November 24th, 2009
Asian stocks fell, dragging the MSCI Asia Pacific Index to a two-week low, amid speculation Japanese and Chinese banks will have to sell shares to replenish capital.
Sumitomo Mitsui Financial Group Inc., Japan’s second- largest bank by market value, fell 4.4 percent after the Nikkei newspaper said banks are preparing a new round of share sales. Bank of China Ltd. slumped 4 percent in Hong Kong after saying it’s studying options to raise funds. Suning Appliance Co., China’s biggest home appliance retailer, fell 5.5 percent in Shanghai on valuation concerns.
The MSCI Asia Pacific Index lost 0.9 percent to 116.68 as of 6:02 p.m. in Tokyo, set to close at the lowest level since Nov. 6. The gauge has climbed 65 percent from a more than five- year low on March 9 on signs government stimulus measures are helping revive the world economy. A global rally yesterday drove the MSCI World Index up by the most in two weeks.
“Markets have had a huge run on expectations of a recovery,” said Matt Riordan, who helps manage about $5.1 billion at Paradice Investment Management in Sydney. “We’re in a period now where signals that the recovery has been priced in are coming through. The market is discriminating a lot more in terms of stocks.” Read the rest of this entry »
Euro Advances Against Yen, Dollar on Signs of Economic Recovery
Posted by Tetyana Matychak in Currency, Favourites on November 2nd, 2009
The euro rose against the yen and the dollar as signs the global economy is recovering trimmed demand for the relative safety of the U.S. and Japanese currencies.
The Australian dollar climbed against all 16 most-traded currencies as Treasurer Wayne Swan said economic growth will be faster than expected and a government report showed house price increases accelerated. Japan’s currency earlier rose to the strongest level in three weeks against the dollar and the euro after New York-based CIT Group Inc. filed for bankruptcy.
“Global data still suggest that the economy is on the mend,” said Minoru Shioiri, chief manager of foreign exchange trading at Mitsubishi UFJ Securities Co. “The underlying need to invest in higher-yielding currencies through carry trades remains intact.”
The euro earlier fell to 131.01 yen, the least since Oct. 9, before trading at 132.91 as of 7:34 a.m. in London from 132.61 in New York on Oct. 30. The yen was little changed at 90.12 per dollar, after touching 89.20, the strongest level since Oct. 14.
Japan’s currency slid to 81.47 per Australian dollar from 81.05 last week, after rising to 79.47, the most since Oct. 8. Australia’s currency fetched 90.42 U.S. cents from 89.97 cents. New Zealand’s dollar was at 72.02 U.S. cents from 71.81 cents last week. Read the rest of this entry »
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Consumer Spending in U.S. Rises More Than Forecast
30 August 2010
Monetary Policy Gets No Respect
19 July 2010Stocks May Surprise By Year-End
5 July 2010
Is A Global Reserve Currency A Necessity?
28 June 2010
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