Black Friday for equities

Juz that no-one noticed it. LOL

The Dow Jones Transportation Average — one of Wall Street’s favourite barometers of economic activity — has fallen for a record 11 consecutive sessions. Many investors, self included, regard its performance as a predictor of growth because it’s made up of of railroad operators, shipping companies and airlines that ship physical goods around the world. On Thursday, it fell for a record-equalling 10th straight session.

And indices including the S&P 500, Nasdaq Composite and FTSE All World all closed below their 200-day moving averages, seen by traders as long-term support levels.

That’s not all: the strength of dollar despite Fed turning chicken on interest rates shows that the other major economies look sick. And strong US dollar is bad for emerging markets.

The gd news is that S&P 5000 fell every day last week for a cumulative drop of about 2.4% That would rank as its worst weekly performance since December 21, just before the market bottomed.

 

Cynical Investor

Cynical Investor blogs at Thoughts of a Cynical Investor

 

 

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14 Responses to “Black Friday for equities”

  • TL Tan:

    Somewhat disagree with CI on this. Even if the transport sector is suffering, the key Tech sector has rebounded because any slowdown there has been due to short-term sluggishness in semiconductors, which will only turn positive in 2H 2019. In Commodities, crude oil is now $67/bbl, comfortably off its lows while copper has risen to $6400/MT from $6000/MT in Dec 2018. Safe-haven gold has fallen below $1300. Market sentiment is fairly good overall, in the knowledge that the US Fed has put interest rate rises on hold. Despite some negative headlines, the underlying global economy is still doing well, just that it is growing at a slower rate.

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  • Asd:

    Trend changed… not much large shipment of goods.. nowadays all small parcel house delivery…

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  • Hagen Diaz:

    The Dow Jones Transportation Average is definitely not Wall Street’s favourite barometers of economic activity. It had the longest string of drops SINCE 1972.
    U.S. stocks rebounded from the worst week of the year and the latest retail-sales data boosted confidence that the economy isn’t headed for a downturn. The S&P 500 surged past its’ 200-day moving average and Nasdaq 100 jumped amid an Apple upgrade. Nvidia agreed to buy a competitor, sending the Philadelphia Semiconductor index to its biggest gain in a month.

    US has an economy that is badly stressed today. Lots of key industries are no longer sustainable, including tech. (Apple, Intel and Nvidia can’t build their products in the US today). One actually do think they are in a tech bubble, like having Facebook and Amazon, with massive valuations and no actual products. Apple sells commodity products at inflated prices. How long can that go on? There is a lot of ultimately unsustainable nonsense out there.

    US worst immediate threat is an incompetent administration staffed by people who have promised to accelerate any downturn with austerity policies to combat recession. If Trump is allowed to continue engaging in trade wars and consumer prices rise significantly, demand will suffer. Food prices are expected to rise, if the trade war with China isn’t resolved.

    Companies are starting to close lines of production and there has been news of the Trump administration shuffling funding around to pay for their immigration policy. With no congressional oversight, they’ve have no idea the extent of that kind of behavior and how widespread it might be.

    There’s also the farmers hard hit by Chinese retaliatory tariffs on soybean and pork. Many are now going through bankruptcy and we know how the trade war with China will play out because we’ve already seen Trump’s playbook: Simply declare victory, regardless of the facts. He did that with his announcement of troop’s withdrawal from Syria (“ISIS has been defeated”) Likewise, Trump will declare that he “won” the trade war with China, regardless of whatever the final outcome may be. Similarly, Trump will declare victory in his talks with the No. Koreans, no matter what the actual deal (if any) is regarding the North’s nuclear weapons program. In short, US is now a country of, “Victory by presidential proclamation.”

    Trump knows that his base either does not care about details or does not care about truth. The exodus of American business and wealth to other nations, commonly called “Global Investing”, is destroying their future economy even though they are doing well now. That’s why the stock market is tracking US-China trade negotiations. What is good for the stock markets and companies one can’t view as good for the future…

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  • No More Issues To Cover?:

    TRE should focus on excelling as alternative media, covering domestic issues and politics.

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  • patriot of TUMASIK:

    CI finally show his TRU Colors & Card unlike Shin Lim’s!!!…self proclaim Financial adviser-Pundit & Forecaster who was trying his UTMOST to draw readers to his Blog…sadly for him Nobody Gives a SHIT!!!

    So he comes to TRE and was declared by TRE Ed as a Satirist which he failed miserably…

    Do him a favour Ed and give him or set a column for Financial wizards True & FAKES to have a forum instead of his stoopid articles riling most readers

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  • patriot of TUMASIK:

    FYI…for all interested in US Financial news…

    Watch Fox Business & Sunday Morning Future a weekly Dow Jones roundup on “U-Tube” and see a pretty girl name Maria B giving her take weekly on Finance with TRUE experts and NOT Fakes like CI

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  • No Dafts or Dogs Allowed:

    Respectfully disagree.
    Need to have a holistic approach. Global issues have great impacts on our domestic economic, socio-political policies. It is like having a “tsunami” warning system in place.

    No More Issues To Cover?:
    TRE should focus on excelling as alternative media, covering domestic issues and politics.

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  • Sda:

    Please la.. if you go see baltic dry.. its been dried up for so donkey long.. but this dont tell the true story of trade anymore cos most have gone by land..

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  • Dafts Will Be Dafts:

    No Dafts or Dogs Allowed:
    Respectfully disagree.
    Need to have a holistic approach. Global issues have great impacts on our domestic economic, socio-political policies. It is like having a “tsunami” warning system in place.

    We don’t come to TRE for “global issues”. Neither do we need more of self professed expert like this article that is of little value.
    Know your space and do it well.

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  • oxygen:

    @ TL Tan

    YOUR STORY LINE IS INTERESTING READ, but not so convincing. Semi-conductors recovering in 6 months? Foxcon slashing wages, benefits and taking long Q of retrenchments.

    https://www.scmp.com/economy/china-economy/article/2188162/foxconn-tale-slashed-salaries-disappearing-benefits-and-mass

    Rising copper price signs of good times around? Mining com says supply deficit given Electric Vehicle demand replacing fossil fueled cars.

    http://www.mining.com/global-copper-market-supplied-demand-rise-report/

    US economy good? Kaplan said Fed pause on interest rate hike because of intensity of corporate debt.

    https://www.reuters.com/article/us-usa-fed-kaplan-idUSKCN1QM1OO

    EU economy not sick enough?

    ECB only stopped its quantitative easing in December 2018. Now less than 3 months later, it is easing money supply of cheap loans to the banks.

    https://www.reuters.com/article/us-ecb-policy/ecb-pushes-out-rate-hike-offers-cheap-cash-to-banks-idUSKCN1QO0MH

    IN OTHER WORDS, QUANTITATIVE EASING OR MONEY PRINTING AGAIN -back to the pre-December 2018 days of ECB posture of WHATEVER IT TAKES OF MONEY PRINTING TO KEEP THE ECONOMY FROM SINKING.

    CHINA IS SLOWING. EU IS MONEY PRINTING. US FED TURNED DOVISH AFTER HAWKISH IN JANUARY (2 months ago)

    GLOBAL ECONOMY NOT BAD ENOUGH???

    I suspect your writing is GOONDU-NOMICS.

    TL Tan: Somewhat disagree with CI on this. Even if the transport sector is suffering, the key Tech sector has rebounded because any slowdown there has been due to short-term sluggishness in semiconductors, which will only turn positive in 2H 2019. In Commodities, crude oil is now $67/bbl, comfortably off its lows while copper has risen to $6400/MT from $6000/MT in Dec 2018. Safe-haven gold has fallen below $1300. Market sentiment is fairly good overall, in the knowledge that the US Fed has put interest rate rises on hold. Despite some negative headlines, the underlying global economy is still doing well, just that it is growing at a slower rate.

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  • No Dafts or Dogs Allowed:

    @ Dafts Will Be Dafts

    萝卜青菜,各有所爱

    Dafts Will Be Dafts: We don’t come to TRE for “global issues”. Neither do we need more of self professed expert like this article that is of little value.
    Know your space and do it well.

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  • oxygen:

    @ Dafts Will Be Dafts

    MATE, RESPECTFULLY TOO, THIS IS VERY DANGEROUS MYOPIA of the limits/boundaries of “your space” and attempting to “do it well”. It is insular mindset that trapped and destroyed the lives of unknown many. Don’t believe me?

    The 34,000 retails investors got lured by 6% annual return who are going to lose at least 90% of their capital WON’T HAVE BOUGHT HYFLUX BOND IF THEY KNEW OF THESE FACTS AND THEIR IMPLICATIONS

    - the GFC is real and not resolved
    - global interest rate falling ONE-WAY since 1980s

    The banks paid 1% to 2% interest for deposits, which issuer so “stupid” to offer investors 6% return unless their survival on knife edge? That is, life-and-death bet, more like death than life survival.

    THE MACRO-ENVIRONMENT ENCAPSULATES AND IMPRISONS THE MOST GULLIBLE AND INSULAR and bait them to their graves. It is capitalism free-market economy and no one pity the gullible, naive and insular so easily given to “I know it all” already.

    Dafts Will Be Dafts: We don’t come to TRE for “global issues”. Neither do we need more of self professed expert like this article that is of little value.
    Know your space and do it well.

    Knowledge is an expanding circle, the more you learn the more you discover you don’t know of “your space and do it well”

    That is why @ No dafts or Dogs allowed is absolutely correct of this smart comment.

    No Dafts or Dogs Allowed: Respectfully disagree.
    Need to have a holistic approach. Global issues have great impacts on our domestic economic, socio-political policies. It is like having a “tsunami” warning system in place.

    IT IS TOO LATE TO DISCOVER YOU FALL IN A DEEP HOLE AND CAN’T CLIMB OUT OF DANGER AND DEATH INEVITABLE.

    The world out there is TURBULENT – you survive or not is your choice. It is the same for me too!!

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  • oxygen:

    @ T L Tan

    OI OI OI, 5 DAYS AGO, you wrote this soapy piece of your BREVITY economics read.

    TL Tan: Despite some negative headlines, the underlying global economy is still doing well, just that it is growing at a slower rate.

    Next day, I countered with this

    oxygen: CHINA IS SLOWING. EU IS MONEY PRINTING. US FED TURNED DOVISH AFTER HAWKISH IN JANUARY (2 months ago)

    GLOBAL ECONOMY NOT BAD ENOUGH???

    I suspect your writing is GOONDU-NOMICS.

    Now after 5 days elapse of your FACILE NARRATIVE, here is the reality of economic woes outside US & EU – namely China and Japan.

    Chinese premier : Our economy faces, ‘new downward pressure’.

    https://www.cnbc.com/2019/03/15/chinese-premier-our-economy-faces-new-downward-pressure.html

    Chinese companies are reporting delays in getting paid by business partners

    https://www.cnbc.com/2019/03/15/chinese-companies-see-delays-in-getting-paid-as-economy-slows.html

    Japan’s central bank is now less optimistic about the economy

    https://www.cnbc.com/2019/03/15/bank-of-japan-keeps-monetary-policy-tweaks-view-on-global-economy.html

    Oh btw, last night US treasury 10-yr & 2 yr broke their technical support level i.e. financial market is pessimistic about the state of US economy.

    Mate, if you are my stockbroker giving investment advice, I would be very WARY of your brand of shallow pandering to goondu-nomics.

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  • oxygen:

    @ T L Tan

    ALAMAK, YOU NO PAI-SEH (embarrassed) with this false gospel of shallow pandering to fiction on the hurried rush of opening volley?

    TL Tan: Despite some negative headlines, the underlying global economy is still doing well, just that it is growing at a slower rate.

    Here is some home truths.

    U.S. corporate leaders are getting worried about a recession

    https://www.marketwatch.com/story/us-corporate-leaders-are-getting-worried-about-a-recession-2019-03-15

    And what Gary Shilling has to add of the true state of global economy?

    “I give a business downturn starting this year a two-thirds probability….The recessionary indicators are numerous….factors such as the near-inversion in the Treasury yield curve, the nasty December for stocks, weaker housing activity, soft consumer spending, etc….Then there are the effects of the deteriorating European economies and decelerating growth in China as well as President Donald Trump’s ongoing trade war with that country,”

    Stocks are poised for an 18% hit, warns economist who nailed last financial crisis

    https://www.marketwatch.com/story/stocks-are-poised-for-an-18-hit-warns-economist-who-nailed-last-financial-crisis-2019-03-18?mod=mw_theo_homepage

    OI OI OI, if U are stuck in shares or properties, BE PREPARED TO LOSE YOUR UNDERPANTS and something unmentionable here too.

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