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Post by ferris1248 on Jun 12, 2024 9:52:45 GMT -5
"A cooler-than-expected reading on inflation Wednesday was good news for Fed policy makers, but it isn’t likely enough to convince officials to cut interest rates just yet." "The question it does raise for today’s Federal Open Market Committee meeting is whether the moderation influences some officials to reduce a prior estimate of three cuts for the rest of 2024 to two instead of one." "The Consumer Price Index (CPI) rose 3.3% over the prior year in May — a deceleration from April's 3.4% annual gain in prices." "The year-over-year change in so-called "core" CPI — which excludes volatile food and energy prices the Fed can’t control — was 3.4% compared with 3.6% in April and 3.8% in March." "In March, the dot plot revealed a consensus among Fed officials for three cuts. Now that projection is in question following a string of sticky inflation readings during the first quarter and cautious commentary from Fed officials." "Most investors now expect just one cut, down from the six cuts they expected at the start of the year." finance.yahoo.com/news/cool-inflation-reading-unlikely-to-change-feds-cautious-stance-on-rates-yet-090034466.html
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Post by richm on Jun 12, 2024 9:54:16 GMT -5
Should be no cuts but we’ll get one just before the election.
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Post by madm002 on Jun 12, 2024 12:40:17 GMT -5
They are already moving to loosen things up with the Feds balance sheet.
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Post by ferris1248 on Jun 12, 2024 14:05:46 GMT -5
"The Federal Reserve signaled Wednesday it would lower interest rates just one time this year, down from the three cuts the central bank anticipated in its previous March projection." "Fed officials see the fed funds rate peaking at 5.1% in 2024. That suggests the Fed will cut rates by 0.25%. The Fed has moved in 25-basis-point increments over the last year or so, indicating the central bank expects to cut interest rates one time in 2024." "Along with its policy announcement, the Fed released updated economic forecasts in its Summary of Economic Projections (SEP), including its "dot plot," which maps out policymakers' expectations for where interest rates could be headed in the future." "The SEP indicated the Federal Reserve sees core inflation peaking at 2.8% this year — higher than March's projection of 2.6% — before cooling to 2.3% in 2025 and 2.0% in 2026." "Officials see the unemployment rate holding steady at 4.0% in 2024, matching the previous forecast. Unemployment is expected to tick higher to 4.2% in 2025 before coming down to 4.1% in 2026." "The Fed maintained its previous forecast for US economic growth, with the economy expected to grow at an annualized pace of 2.1% this year before ticking down slightly to 2.0% in 2025 and remaining at that level through 2026." finance.yahoo.com/news/fed-dot-plot-suggests-central-bank-will-cut-interest-rates-one-time-in-2024-down-from-3-cuts-in-march-180721497.html
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Post by johngalt on Jun 13, 2024 8:13:30 GMT -5
Is it true that the stock market is being carried by the top seven tech stocks?
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Post by madm002 on Jun 13, 2024 8:38:21 GMT -5
Is it true that the stock market is being carried by the top seven tech stocks? Depends how you define the market. Actually 3 or 4 are doing the heavy lifting, but upside surprises by companies like Oracle also help
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Post by ferris1248 on Jun 13, 2024 8:53:19 GMT -5
Certainly the "7" are the bellwethers and have driven the market for a while. It's kind of expected due to their size and influence compared to other companies.
I wouldn't say they are the end-all, be-all of the market. I say that as an investor. A trader might look at it differently.
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Post by madm002 on Jun 13, 2024 10:20:35 GMT -5
I think the traders are there as well Ferris. Its everyone on one side of the boat time and that scares me.
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Post by madm002 on Jun 13, 2024 11:47:32 GMT -5
If you look at my portfolio today, everything is down but NVDA and AVGO, which are up big. Even LRCX, which normally trades in lock step with NVDA is down slightly.
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Post by nuevowavo on Jun 17, 2024 13:49:08 GMT -5
I've owned Nvidia since 121, and my portfolio manager's been letting it go bit by bit all the way up. And it's still my biggest position.
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Post by nuevowavo on Jun 17, 2024 13:58:42 GMT -5
Cash 20% (money market fund yielding 5.25%) Stocks 80% - all managed by Fisher Investments, U.S. equities. I told them they could have the money as long as they beat the S & P 500, and so far they have, after their 1.25% fee. Bonds 0%. And I was a Wall Street bond trader for 30 years. They are ripping you off. .79% fee my money management company charges me and the company has beat the S&P for the last 20 years.
Paying for performance. To mitigate risk, I take my profit off the table every time I'm up 10%. I gave Fisher my money in September '22. Since then I've been up that 10% and taken that profit 5 times, and am almost ready to do it again. I'm fine with their 1.25% fee.
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Post by ferris1248 on Jun 20, 2024 6:18:01 GMT -5
There's a correction coming. But when?
"The stock market is in for a correction, as a trio of unfavorable factors will weigh on equity prices, according to Sam Stovall, chief investment strategist of CFRA Research." "The Wall Street veteran pointed to the strong performance of stocks so far this year, with the S&P 500 up 15% in 2024. However, the benchmark index is poised to dip 5%, he predicted, thanks to the bearish setup in interest rates, inflation, and stock valuations." "Inflation is declining but is still above the Federal Reserve's 2% target, leading central bankers to project just one rate cut by the end of the year." "Higher rates have triggered the longest-ever inversion of the 2-10 Treasury yield curve, the bond market's famous gauge of a coming recession. The indicator, which flashes when the 2-year yield surpasses the 10-year yield, has been a reliable recession signal throughout history, and economists have said that this time likely won't be different." "Stock valuations are also high by historical standards, which hints at future downside. The S&P 500 is priced at a 32% premium compared to its average price-to-earnings ratio over the last 20 years, Stovall noted. Tech stocks, which have dominated the market in recent years, are trading at a 68% premium." "I think we're really stretched and we got to see some upward revisions to earnings estimates, I think, in order to justify that," Stovall said in a recent interview with CNBC." "Stocks could see their first "crack in the ice" in the tech sector, he added, pointing to lofty valuations among mega-cap tech stocks." "It's only been tech that's been outperforming the market. I sort of feel this is a jumbo jet that's flying on one engine, and you wonder how long it will stay aloft," he warned." "Other forecasters have warned of limited upside to the market as stocks — particularly tech stocks — continue to climb higher. According to one valuation metric, the stock market looks to be the most overvalued since 1929, which could pave the way to a steep correction, elite investor John Hussman warned." finance.yahoo.com/news/stock-market-correction-coming-rates-212701329.html
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Post by madm002 on Jun 20, 2024 8:29:16 GMT -5
If you look at the growth in the jobs, the highest growth has been in the government jobs. I heard some pretty smart hedge fund guys talking about this, and they are worried that if the spending and stimulus stops, the economy will have that long awaited recession. But they thought it was 18 months out. I just need to get through this year, and reposition in Jan. I have been doing buy-writes on NVDA, so far so good
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Post by richm on Jun 20, 2024 8:47:32 GMT -5
There's a correction coming. But when?
"The stock market is in for a correction, as a trio of unfavorable factors will weigh on equity prices, according to Sam Stovall, chief investment strategist of CFRA Research." "The Wall Street veteran pointed to the strong performance of stocks so far this year, with the S&P 500 up 15% in 2024. However, the benchmark index is poised to dip 5%, he predicted, thanks to the bearish setup in interest rates, inflation, and stock valuations." "Inflation is declining but is still above the Federal Reserve's 2% target, leading central bankers to project just one rate cut by the end of the year." "Higher rates have triggered the longest-ever inversion of the 2-10 Treasury yield curve, the bond market's famous gauge of a coming recession. The indicator, which flashes when the 2-year yield surpasses the 10-year yield, has been a reliable recession signal throughout history, and economists have said that this time likely won't be different." "Stock valuations are also high by historical standards, which hints at future downside. The S&P 500 is priced at a 32% premium compared to its average price-to-earnings ratio over the last 20 years, Stovall noted. Tech stocks, which have dominated the market in recent years, are trading at a 68% premium." "I think we're really stretched and we got to see some upward revisions to earnings estimates, I think, in order to justify that," Stovall said in a recent interview with CNBC." "Stocks could see their first "crack in the ice" in the tech sector, he added, pointing to lofty valuations among mega-cap tech stocks." "It's only been tech that's been outperforming the market. I sort of feel this is a jumbo jet that's flying on one engine, and you wonder how long it will stay aloft," he warned." "Other forecasters have warned of limited upside to the market as stocks — particularly tech stocks — continue to climb higher. According to one valuation metric, the stock market looks to be the most overvalued since 1929, which could pave the way to a steep correction, elite investor John Hussman warned." finance.yahoo.com/news/stock-market-correction-coming-rates-212701329.html "It is no secret that small-cap stocks have struggled this year -- and last year, too. In fact, they have underperformed their large-cap peers for more than a decade now." We have inflation - subtract that from the valuations. Stocks will hold value while plain cash loses it. So a 10% increase in costs drops the dollar from 100 to 90 but a stock goes from 100 to 110. This is a lot of our increase. Also, the non-tech stocks are either bumping along or declining while 4 are shooting for the moon... Could they be recessing? They keep warming of a recession and the curves are steeply headed up. Common sense says this can't be maintained. With the govts manipulating everything, who can say for sure?
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Post by nuevowavo on Jun 20, 2024 13:35:49 GMT -5
On the other hand: When the Fed finally starts cutting rates, all those sexy money market fund and bond yields will come down, and there's a ton of money out there in fixed income. No place to go other than equities. As for the economy, people have been predicting a recession for quite a while, but a soft landing still looks probable.
As for employment, May's job creation:
Health care added 68,000 jobs in May, in line with the average monthly gain of 64,000 over the prior 12 months. In May, employment growth continued in ambulatory health care services (+43,000), hospitals (+15,000), and nursing and residential care facilities (+11,000).
Government employment continued to trend up in May (+43,000), in line with the average monthly growth over the prior 12 months (+52,000).
Employment in leisure and hospitality continued to trend up in May (+42,000), similar to the average monthly gain over the prior 12 months (+35,000). Employment in food services and drinking places continued to trend up over the month (+25,000).
Professional, scientific, and technical services added 32,000 jobs in May, higher than the average monthly gain of 19,000 over the prior 12 months. Over the month, employment increased in management, scientific, and technical consulting services (+14,000) and in architectural, engineering, and related services (+10,000). Specialized design services lost 3,000 jobs.
Social assistance employment continued to trend up in May (+15,000), primarily in individual and family services (+11,000). Over the prior 12 months, social assistance had added an average of 22,000 jobs per month.
In May, employment in retail trade continued to trend up (+13,000), about in line with the average monthly gain over the prior 12 months (+8,000). Building material and garden equipment and supplies dealers added 12,000 jobs in May, while job losses occurred in department stores (-5,000) and furniture and home furnishings retailers (-4,000).
Employment showed little or no change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; transportation and warehousing; information; financial activities; and other services.
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