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Dow Industrials Hasn’t Started The Year This Horribly In 84 years
Andy Busch China, US and oil notes for CBS WBBM 780 Noon Business Hour today at 12:00CT
I’m leading of their show today at 12:05, check it out here
WBBM Notes 1/4/2016 1. China a. Sell-off driven by weaker than expected PMI data for both official and private numbers showing 10 straight months of lower growth. b. Circuit breaker confusion. These were installed to curb volatility but have likely generated more uncertainty and selling. i. 7% drop triggered the breaker and caused their markets to close early. ii. This leads investors in the lurch and unable to dump shares. iii. The circuit breaker system creates an incentive to “sell now” and find out later if you can still sell. c. As well, January 8th is the date when the Chinese regulators are lifting the ban on sales for listed companies major shareholders, which was imposed last summer. d. Lastly, the US dollar against the Chinese currency broke above 6.50 for the first time since 2011. 2. Why this matters for the US markets:( might ? ) :a. The last time we had a drop of this size in the Chinese markets in August, the US markets had a large drop (10%) as well about a week later. b. Seasonality. As January goes, so goes the rest of the year. i. This indicator has had an 88.5% accuracy ratio since 1950. ii. It’s only been wrong 7x. iii. So goes the first week of January, so goes the month of January with an accuracy ratio of 86.8% iv. Since 1950, every down January on the S&P 500 has preceded a new or extended bear market, a flat market or a 10% correction. http://www.andrewbusch.com/2016/01/china-us-and-oil-notes-for-cbs-wbbm-780-noon-business-hour-today-at-1200ct/
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China, US and oil notes for CBS WBBM 780 Noon Business Hour today at 12:00CT
I’m leading of their show today at 12:05, check it out here
WBBM Notes 1/4/2016
1. China
a. Sell-off driven by weaker than expected PMI data for both official and private numbers showing 10 straight months of lower growth.
b. Circuit breaker confusion. These were installed to curb volatility but have likely generated more uncertainty and selling.
i. 7% drop triggered the breaker and caused their markets to close early.
ii. This leads investors in the lurch and unable to dump shares.
iii. The circuit breaker system creates an incentive to “sell now” and find out later if you can still sell.
c. As well, January 8th is the date when the Chinese regulators are lifting the ban on sales for listed companies major shareholders, which was imposed last summer.
d. Lastly, the US dollar against the Chinese currency broke above 6.50 for the first time since 2011.
2. Why this matters for the US markets:( might ? )
:a. The last time we had a drop of this size in the Chinese markets in August, the US markets had a large drop (10%) as well about a week later.
b. Seasonality. As January goes, so goes the rest of the year.
i. This indicator has had an 88.5% accuracy ratio since 1950.
ii. It’s only been wrong 7x.
iii. So goes the first week of January, so goes the month of January with an accuracy ratio of 86.8%
iv. Since 1950, every down January on the S&P 500 has preceded a new or extended bear market, a flat market or a 10% correction.
http://www.andrewbusch.com/2016/01/china-us-and-oil-notes-for-cbs-wbbm-780-noon-business-hour-today-at-1200ct/