Financial Review

Double Irish With a Side of Knowledge Box

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-10-14-2014.mp3Podcast: Play in new window | Download (Duration: 13:17 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW – 5 = 16,315 SPX + 2 = 1877 NAS + 13 = 4227 10 YR YLD – .08 = 2.20% OIL – 3.76 = 81.98 GOLD – 4.90 = 1233.20 SILV – .11 = 17.49 The Dow was down slightly, while the S&P and Nasdaq snapped a 3 day slide, but this was almost a quiet day; call it neutral. A follow-up on yesterday’s discussion of the 200 day moving average. The S&P 500 dropped down to the 200 day moving average on Friday (right around 1905), and then fell right through the trend line yesterday. We talked about the possibility of a bounce; and I don’t think today’s minor move qualifies as a bounce, even though it was a positive move. So, we are still waiting for a possible bounce. The 200 day moving average is a lagging indicator, and so for now, the trend line is still moving higher; which increases the prospects for a bounce. When the price drops below a declining 200 day moving average, it is considered extremely bearish and the probability of a bounce is very low. So, we wait for confirmation. It is earnings reporting season, and today’s reports feature the banks. We start with JPMorgan Chase, the nation’s largest bank by assets, reporting third quarter net income of $5.6 billion, or $1.36 per share, a big improvement from the same period last …

READ MORE →
Financial Review

The Only Winner is Gravity

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-10-09-2014.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW – 334 = 16,659 SPX– 40 = 1928 NAS – 90 =4378 10 YR YLD un 2.33% OIL – 2.96 = 84.35 GOLD + 2.10 = 1224.60 SILV – .03 = 17.45 Triple-digit swings in the stock market have become common in recent days. Just this week, the Dow jumped 274 points Wednesday, reversing a 272-point decline on Tuesday. We’ll talk about volatility in just a moment. In economic news: Germany’s exports sank 5.8 percent in August, the biggest monthly drop in five years. The figure raised concerns that Europe’s largest economy may fall into recession. European Central Bank President Mario Draghi says Europe’s problems are structural, not cyclical and there can be no recovery without reforms. Draghi was speaking in New York; he said the Euro banking sector is still going through deleveraging; they are not lending; and there are limits to what the ECB can do to produce growth. And deflation is highly contagious. The number of people who applied for U.S. unemployment benefits in the first week of October edged down by 1,000 to a seasonally adjusted 287,000, holding below 300,000 for the fourth straight week. Jobless claims are now 21% lower compared to one year ago. What we are starting to see is that so many businesses fired workers during the downturn and they have been very slow to rehire or hire new workers, which means not …

READ MORE →
Financial Review

Thanks Hank

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-10-07-2014.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW – 272 = 16,719 SPX – 29 = 1935 NAS – 69 = 4385 10 YR YLD – .07 = 2.35% OIL – 1.91 = 88.43 GOLD + 1.50 = 1209.30 SILV – .16 = 17.29 The S&P 500 dropped below its 50-day moving average last week and has yet to move back above that level. Coincidentally, the S&P 500 has been sliding for a few weeks, going back to September 19, which was the day of the Alibaba IPO, just coincidentally. The Dow is also trading below its 50 day moving average. Welcome to the start of earnings season. In the past 3 months the US dollar has jumped by 8% against the euro. That makes American goods more expensive relative to European goods. And it wasn’t just the dollar against the Euro, but against a basket of foreign currencies. It is estimated that a 5% rise in the dollar versus the euro results in a drop of about $1 for full-year Standard & Poor’s 500 Index per-share earnings; current estimates for the S&P are running around $118. Partly because of the dollar and the related decline in oil prices, earnings estimates have seen one of the largest downward revisions over the last few years aside from the weather-beaten first quarter of this year. Earnings-per-share are projected to have grown 4.9% in the third quarter, that’s down from 7.8% earnings …

READ MORE →
Financial Review

Be Careful Out There

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1_2-08-22-2014.mp3Podcast: Play in new window | Download (Duration: 20:28 — 9.4MB)Subscribe: Apple Podcasts | Android | RSS08222014 LISTEN HERE DOW – 38 = 17,001 SPX – 3 = 1988 NAS + 6 = 4538 10 YR YLD un = 2.40% OIL – .46 = 93.50 GOLD + 4.30 = 1281.60 SILV un = 19.51 All three major indices posted gains for the week, with the Dow up 2%, the S&P up 1.7% and the Nasdaq up 1.6%. It was the strongest week of gains for both the Dow and the S&P since April, and the third straight week of gains for all three indices. There is a lot to cover before we can wrap up the week. First we go to Jackson Hole Wyoming, where the Fed has been having a friendly get together of economists. Janet Yellen kicked off the event with a speech this morning. She said what you might expect: “There is no simple recipe for appropriate policy,” and she called for a “pragmatic” approach that gives officials room to evaluate data as it arrives without committing to a preset policy path. And she backed up her comments with a new tool, the Labor Market Conditions Index, which measures 19 labor market indicators, and it isn’t new data, just combining it all together, but it showed she is monitoring the data. Yellen referenced the possibility that labor markets may be a bit tighter than they seem and that the Fed may consider having to raise interest rates …

READ MORE →
Financial Review

Wednesday, May 21, 2014 – Congratulations Graduates, Yada, Yada, Yada

Congratulations Graduates, Yada, Yada, Yada by Sinclair Noe   DOW + 158 = 16,533 SPX + 15 = 1888 NAS + 34 = 4131 10 YR + .02 = 2.53% OIL – 33 = 103.74 GOLD – 2.40 = 1292.90 SIL  un = 19.49   Earnings season is winding down; about 96% of S&P 500 companies have reported results, with profit growth this quarter of 5.5% and revenue up 2.8%. While more companies have topped earnings expectations than usual, fewer have beat on the revenue side. This has been an ongoing theme for corporate profits; bottom line growth without corresponding sales. If this formula sounds unsustainable, it is, unless there is some other factor pumping up the markets.   Follow-up from yesterday: China has signed a 30-year deal to buy Russian natural gas worth about $400 billion. The gas deal gives Moscow an economic boost at a time when Washington and the European Union have imposed visa bans and asset freezes on dozens of Russian officials and several companies over Ukraine. It allows Russia to diversify its markets for gas, which now goes mostly to Europe; essentially opening the door to Asia’s gas market and potentially closing the door on the petro-dollar.   The Federal Reserve today released the minutes of the most recent FOMC meeting. Fed policymakers considered several approaches to tightening monetary policy, but decided to remain flexible; which is another way of saying QE is a big experiment and they are just hoping nothing explodes in their …

READ MORE →
Financial Review

Wednesday, April 23, 2014 – A Brilliant Future From Cool Ideas

A Brilliant Future From Cool Ideas by Sinclair Noe DOW – 12 = 16,501SPX – 4 = 1875NAS – 34 = 412610 YR YLD – .05 = 2.68%OIL – .2- = 101.55GOLD un 1284.70SILV + .06 = 19.55 It’s earnings season, and this is a chance to compare and contrast. This morning, Facebook posted earnings of $642 million in net income, or 25 cents a share, in the first quarter, versus $219 million, or 9 cents a share in the year ago period. Overall revenue grew 72% year-on-year to $2.5 billion in the first quarter, topping estimates. Facebook now has 1.28 billion active users, and more than 1 billion do their Facebook stuff on a mobile device. Then Facebook announced their Financial Director was resigning. Shares were up about 3%. Nobody puts on a better presentation than Apple, that’s how they grew to be the most valuable company in the world. Steve Jobs would walk out and announce Apple had created a new mp3 player, and also a new way to connect to the internet, and also a new camera. Wow, three new products, nope…, he would hold up the iPhone – just one very cool thing from Apple; tech geeks heads would explode. Today, Apple posted earnings of $10.2 billion or $11.62 a share, on revenue of $45.6 billion. Analysts expected the company to report earnings excluding items of $10.18 a share; Apple reported a 4.6% rise in March-quarter revenue to $45.6 billion; Apple sold 43.7 million iPhones in …

READ MORE →
Financial Review

Monday, April 21, 2014 – Why Stocks Continue Going Higher

Why Stocks Continue Going Higherby Sinclair Noe DOW + 40 = 16,449SPX + 7 = 1871NAS + 26 = 412110 YR YLD un 2.72%OIL – .01 = 103.64GOLD – 4.30 = 1291.30 SILV – .21 = 19.54 The S&P 500 has gained for five straight sessions, marking the longest winning streak since October. This has not been a pretty rally. Volume was light today; that has been part of the trend; light volume on up days and heavy volume on down days. We are smack dab in earnings reporting season, and 87 companies have posted results through this morning with 62% beating earnings expectations; that’s down from 66% beating earnings over the past 4 quarters, and those earnings expectations have been ratcheted lower and lower, so it should be an easy bar to cross. And still the markets have been moving higher. Dozens of S&P 500 components will report earnings this week, including Apple, Biogen, Facebook, McDonald’s, AT&T and Caterpillar. More than 30 companies in the Nasdaq 100 (NDX) are slated to report earnings. After the close of trade Netflix posted a first-quarter profit of $53 million, or 86 cents a share, up from $3 million, or five cents a share, a year ago. The company in January had projected a profit of 78 cents a share. The stock shot up about 7% to $372 in extended-hours trading. After a jump of 300% in 2013, Netflix had slumped recently. As part of the earnings announcement, Netflix announced a price hike, …

READ MORE →
Financial Review

Friday, April 18, 2014 – Yes, We Have No Avocados

Yes, We Have No Avocados by Sinclair Noe The markets are closed today in observance of Good Friday. No economic reports today. Let’s take a look at next week’s economic calendar. On Wednesday, we’ll get reports on new and existing home sales. New home sales are expected to be up slightly, while existing home sales are expected to post a decline for the third consecutive month. Higher mortgage rates and rising prices have pushed some potential buyers out of the market. The average rate on a 30-year fixed mortgage is up almost a full percentage point from its recent low one year ago. The softness in home prices in the first quarter has also hurt homeowners struggling with negative equity. The pool of underwater borrowers peaked at 12.8 million, or 29% of all properties with a mortgage, in the second quarter of 2012. Rising prices have lifted millions back above water. As of the first quarter of this year, some 9.1 million homes (or 17% of homes with mortgages) were “seriously” underwater, owing at least 25% more than property’s estimated market value. Next Friday, we’ll see the Consumer sentiment index, which has been showing a lack of enthusiasm reflecting the weak pace of hiring and meager pay raises for most households, which in turn results in sluggish consumer spending. Thursday, we’ll get a report on durable goods orders. If economic growth is finding traction, you would expect to see businesses spending more on equipment, which should show up in the …

READ MORE →
Financial Review

Thursday, April 17, 2014 – The Growth Industry for the Next 20 Years

The Growth Industry for the Next 20 Years by Sinclair Noe DOW – 16 = 16,408SPX + 2 = 1864NAS + 9 = 409510 YR YLD + .08 = 2.72%OIL + .83 = 104.59GOLD – 7.60 = 1295.60SILV + .02 = 19.75 Stocks ended a holiday-shortened week with mixed results. Stock markets will be closed tomorrow in observance of Good Friday. The S&P 500 had its best week since last July. For the week, the Dow rose 2.4%, the S&P 500 added 2.7% and the Nasdaq advanced 2.4%. With less than one-fifth of S&P 500 companies having reported results so far, about 63% have topped earnings expectations and 52% have topped revenue expectations. Of course that’s part of the dance between corporations and analysts, but it does move stock prices. For example, Goldman Sachs reported an 11% drop in quarterly profit and revenue fell 8%, but the results were better than estimates and share price was higher on the day.  Among the other earnings related movers today, Google, IBM, Mattel, and United Health were down on poor earnings news, while Morgan Stanley, GE and Pepsi moved higher. The number of Americans filing new claims for unemployment benefits rose less than expected in the latest week and came near pre-recession levels. The Labor Department also reports weekly earnings of the typical full-time worker rose 3% in the first quarter compared to a year earlier, the fastest pace since 2008. Median earnings came in at $796, that’s the point where half of …

READ MORE →
Uncategorized

Thursday, March 27, 2013 – Certain Assumptions

Certain Assumptions by Sinclair Noe DOW – 4 = 16,246SPX – 3 = 1849NAS – 22 = 415110 YR YLD – .03 = 2.67%OIL + 1.02 = 101.28GOLD – 14.10 = 1292.70SILV – .05 = 19.79 Stocks fell for the fourth time in 5 sessions. This year’s first quarter, which ends Monday, isn’t nearly as bullish as last year, when the benchmark Standard and Poor’s 500 stock index soared 10% in the first three months of the year on its way to a 29% gain. The broad market is unchanged in 2014.  The losing sectors today included banks and biotech. The Nasdaq Biotechnology Index, up 304% in the last five years, has fallen 11% since the end of February, while the Russell 2000 gauge of smaller companies has slipped 2.7% after rallying more than 230%. If you really want a great investment, it’s hard to beat collecting $7,250 for every $1 you spend. That’s the benefit Boeing will reap from a ramped-up lobbying push in Washington state that ended with a massive $8.7 billion tax subsidy. A new analysis of lobbying data shows the tax break came as part of a deal to keep production of a new jet, the 777X, in the Seattle area. Lobbying data is notoriously difficult to parse because matching individual dollars to specific legislative priorities is often impossible. It’s plausible that the company could have achieved the same result with a single phone call, given how terrified state officials were that the company might ship …

READ MORE →