Financial Markets Newsletter

Break-Out or Fake-Out?

The stock markets have edged higher since early October and now are making new all-time highs. Economic data could look better but the good news is that the deterioration that we saw over the summer is abating. Trade negotiations with China are in flux but both sides are indicating signs of an agreement so there […]

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Duty Free or Bust

The S&P 500 moved up slightly this week (0.38%) but mostly consolidated after breaking a major resistance line in the chart below (yellow line). The market is focused on any news regarding a trade deal with China as trade uncertainty has caused CEOs to re-think international supply chains and how they do business which threw […]

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Time to Forget the Fed

The Fed cut interest rates on Wednesday for the third time this year indicated that they are likely done for the foreseeable future. Also, the Repo operations that began in mid-September will continue into next year where the Fed is purchasing up to $60B of T-bills on a monthly basis. Chairman Powell tried to differentiate […]

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New Highs?

The S&P 500 is 5.3% above the high achieved in January of 2018. We last touched this price earlier this month on October 3rd. As the chart below shows, the stock market has largely gone sideways as Fed policies and trade uncertainty have paused the multi-year uptrend. However, this period of uncertainty may be coming […]

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Dealer’s Choice

All the cards are on the table and now we will see which players can pull an ace from the hole. The vibes in the financial markets over the last few months have been bad as global growth slows and international trade relations deteriorate. Who is playing with a strong hand? The Fed: Got lucky […]

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The Machine

Welcome to the machine. And the machine makes stocks go higher. Central banks and governments are working together at all costs from letting the U.S. stock market crash and burn. On Friday we got word that a trade deal with China is underway which means the tariff machine will be dialed down and don’t forget […]

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Fed to the Rescue?

Time and again, the Fed has provided stimulus to keep the stock markets afloat for many bumps in the economy over the last 10 years. Will they do it one more time? The REPO activity at the end of September caused the Fed to increase the size of their balance sheet (+$185B) which replicates the […]

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WeSlide

Another variable was thrown into the cesspool of market risk this week as the President is under an impeachment inquiry – not a surprise if you follow the politics. At this point, the markets have so many things weighing on its shoulders that fatigue is beginning to take its toll – the list is too […]

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The Fed REPOrt

A big week of central bank news that may have disappointed the stock market bulls. The Fed cut 25bps this week but tapped the brakes on additional stimulus measures (for now). Let’s take a look at the S&P 500 chart where we are hovering just below all-time highs after a very choppy August. September is […]

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To QE or…..

The European Central Bank (ECB) lasted nine months without their Quantitative Easing program as their stimulus measures are again needed to support the slowing EURO zone (more below). Is the Fed next? We will have additional clarity on Wednesday where the market expects the Fed to cut interest rates 25bps and perhaps provide some forward […]

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