12 Jan 2016

Earnings Season is Upon Us

The headlines have been filled with major macroeconomic news from China and elsewhere that have pushed stock prices lower. It’s perfectly legitimate to factor this news into stock prices because our collective fortunes are tied together whether we like it or not.  If Chinese gross domestic product falls substantially, you can be sure that ours will drop as well along with growth prospects for US companies. Last night, earnings season… Read More

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4 Jan 2016

Stocks End Year with a Whimper

For me, reading the Wall Street Journal is a bit like eating, drinking and sleeping – I can’t really go without any of these things for very long.  I think that their reporting is fair and accurate and definitely of interest to me. So, I was a bit annoyed when the Friday headlines read ‘US stocks Post Worst Annual Losses Since 2008.’ Now that headline is accurate – last year… Read More

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29 Dec 2015

Market Forecasts Part 2

Yesterday I posted some of the questions and answers from the Barron’s annual ‘Test Your Wall Street Skills’ quiz. Here’s a link to my article from yesterday and here is the link to the article in Barron’s (a subscription may be required). Most of the ‘big’ questions have already been answered, but there are still some fun ones: 1. Which ‘FANG’ stocks will fare worst in 2016 – Facebook, Amazon,… Read More

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28 Dec 2015

Market Forecasts Part 1

Over the weekend, Barron’s put out their annual quiz for readers to predict market related events in the coming year (you can find the quiz here, but a subscription may be required). I thought it would be fun to share some of my answers – but keep in mind the quote from Warren Buffet, who said that ‘the only value of stock forecasters is to make fortune-tellers look good.’ I… Read More

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14 Dec 2015

S&P 500 Turns Negative for Year

The rout last week reminds me of the market tremors in August and September that caused the Federal Reserve to blink. Markets thought that the Federal Reserve would raise interest rates in the September meeting and were surprised when the Fed cited market turbulence when they kept the rates unchanged. In September, markets were worried about global growth and the sharp selloff in Chinese stocks, which had fallen 40 percent in a… Read More

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3 Dec 2015

Stocks Reverse Solid Gains (Exactly)

One of the interesting stories yesterday was that Yahoo might sell its core business, which got me wondering: what is Yahoo’s core business? Interestingly, the market is puts a negative value on Yahoo’s core business, whatever it is.  Let’s take a look at some of their assets: a 15 percent stake in Alibaba worth $32 billion, a 35 percent stake in the separate publicly traded Yahoo Japan that is worth… Read More

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27 Apr 2015

Flash Crash Surprise, Five Years Later

It’s been almost five years since the ‘flash crash,’ when markets fell by about nine percent in less than 40 minutes in the middle of a trading day. Some well-established companies like Procter & Gamble fell by 40 percent within one minute while others like Sam Adams traded for just one penny per share even though it was selling for around $60 per share minutes earlier. I remember it vividly… Read More

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9 Mar 2015

It’s Good News that Good News is Bad News

The Bureau of Labor Statistics (BLS) offered some good news regarding the employment situation on Friday. The economy added 295,000 new jobs in February, far better than the consensus expectations of 240,000 and the unemployment rate fell from 5.7 to 5.5 percent, a new low since the 2008 financial crisis and the peak unemployment rate since then of 10 percent in 2009. Part of the reason for the decline in… Read More

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4 Mar 2015

Another Internal Market Correction

A correction is defined as a 10 percent peak-to-trough decline and a bear market is defined as a 20 percent peak-to-trough decline. With those definitions in mind, it’s worth noting that the utilities sector entered correction territory yesterday after falling 10 percent from their highs at the end of January. Energy stocks are down more than 20 percent since their high last summer, and have been in bear market territory… Read More

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3 Mar 2015

NASDAQ: Party Like It’s 1999

If you were watching CNBC or Bloomberg television yesterday, you saw that the ‘big news’ of the day was that the NASDAQ market crossed 5,000 for the first time since the peak of the tech bubble. Although the financial news media loves to celebrate when indexes cross round numbers (think 2,000 for the S&P 500 or 18,000 for the Dow Jones Industrial Average), they don’t do a whole lot for… Read More

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