Hello and good morning,
Today will be the last post of the week for "The Markets and More" as I will be traveling, starting tomorrow, through next week and unable to write a morning opening. However, I should be able to check the board from time-to-time. Perhaps, in the evenings I will be able to provide updates on the barometer readings.
Yesterday, the S&P 500 Index continued to climb the earnings wall and finished with another closing high of 2,249.25 up +0.50% for the day. The three best performing sectors were health care, consumer staples and financials. For the past couple of days the vix reading has jumped indicating some stormy markets are perhaps ahead. It is interesting too that the barometer yesterday dropped from a reading of 142 to 138 which is indeed a big drop on it's scale. Should it continue to drop and reach a reading of 135 then the Index (stocks) will have moved from overvalued to overbought by the barometer.
In checking the markets this morning as I write Europe is down across the board while Asia-Pacific is mostly up with the exception being Japan. In the States in checking the futures this morning stocks look to be down and government bonds up. The three best performing futures yesterday were the vix, cocoa, and orange juice. The US 10 Year closed with a yield of 2.483%.
For me, since I am a couple percent from the top of my equity allocation range within my portfolio and we are still in the strong seasonal trend period for stocks I'm going to continue to ride this earnings driven Trump rally. When it stops nobody realy knows ... but, I do feel the valuation for the 500 Index is getting streached and stocks have become richly priced. But, investors seem to keep buying according to the MFI readings. I'm thinking we are in for a near term stock market pullback and/or perhaps some range bound market movement until some of this energy gets worked off and (I'm still thinking) stocks will again continue to climb the earnings wall. At this point, I am not selling stocks nor buying traditional bonds; however, I might add, in the near term, to my convertible securities fund.
http://markets.wsj.com/usoverviewhttp://finviz.com/futures.ashxEarning Season continues with a slew of companies reporting earnings today. A couple of noteworthy companies are Avon Products, Dean Foods, Duke Energy, Republic Services and Waste Management.
https://biz.yahoo.com/research/earncal/today.htmlRon Rowland's Leadership Strategy & Weekly Newsletter (click newsletter archives to read)
http://investwithanedge.com/leadership-strategy"The Markets and More" is posted for information purposes only and is not ment to be taken as investment advice. I am simply writting about what I am up to within my own portfolio and some of the tools that I use, as a retail investor, to assist me in throttling my own equity allocation within my portfolio's broader asset allocation.
Have a great day ... and, most of all I wish all "Good Investing."
Old_Skeet
Comments
Asia markets have been quiet lately except for Japan which did go down a little bit. While some companies like Toshiba are having bad days, others like the mega banks have countered with gains in their stock.
With today's market close Old_Skeets market barometer moved from a reading of 138 to a reading of 139; and, with this remains in the overvalue area on the scale.
Next update ... sometime Friday evening.
Old_Skeet
As of Friday's maket close Old_Skeet barometer is back to a reading of 138 whcih is towards the upper part of the scale for overvalue. The only feed that is keeping the barometer from reading overbought is the earnings feed. The number of stocks in the S&P 500 Index above their 200 moving average is now just short of 80%. With this, I am either looking for a near term pullback or for the Index to move sideways (range bound) until some of its energy gets worked off.
The next update will be Tuesday evening.
Today is Tuesday February 21, 2017 around 7:00 PM EST.
Stocks closed at yet another record high today with the S&P 500 Index at 2365 and change. With this, stocks continue to climb the earnings wall. The barometer currently has the Index overbought with a reading of 134. All of the barometer's feeds with the exception of the earnings feed have the Index overbought and if it were not for the forward earnings outlook and an improvement in TTM earnings the barometer would reflect the Index to be extremely overbought.
I thought about taking some profit; but, since we are still in the strong seasonal trend period for stocks I'm going to let things go for a while longer before I rebalance. Remember, part of Old_Skeet's asset allocation is to hold an ample amount of cash, currently about 20%, or so. Should, we get a nearterm pullback of 10% to 15% in the Index I'll most likely do a little buying. My allocation in equities ranges from 45% to 55% and with me currently being at about 53% does not leave room for me to do a lot of buying so I'm wanting to see good value before I deploy new cash.
My next update, due to travel and time constraints, will be sometime after market close Friday February 24 or possibly sometime Saturday.
Have a good week ... and, most of all I wish all ... "Good Investing."
http://www.mutualfundobserver.com/discuss/discussion/31608/sure-sign-of-market-top-impending-doom#latest