Stocks have needed a reason to take a breather and pull back in this long-standing ultra-bullish climate, with strong economic data and seasonality providing impressive tailwinds — and plummeting oil prices certainly have given it to them. But this minor pullback was fully expected and indeed desirable for market health. The future remains bright for…
West Texas Intermediate sold for $105 a barrel at the start of July, but ended last week at $58. The most important factor has been surging U.S. production. But another reason oil prices have slid so much is weakness in demand for the product, which may be related to a slowdown of overall world economic growth….
While the entire financial world is hanging on to every Mario Draghi word in hope Europe finally improves the market’s (if not the economy’s) “fundamentals” to new record highs, and joins the rest of the “developed” world’s central banks in injecting trillions of liquidity into the Div/0 P/E stocks “whatever it takes” (because in a…
So the markets are getting skittish and the media is obsessing about the many things that could go wrong out there. It’s like 2007 all over again, but with one big difference: Back then the mega-banks were reasonably sure the government would, if necessary, bail them out of their hundreds of trillions of dollars of…
Bearish Sentiment Priced In? The futures contract for January 2015 has gone from $102 a barrel in July to $57 a barrel today, a $45 dollar a barrel discounting of price in less than six months. Much of this move is based upon bearish sentiment and future expectations for oil supplies along with bearish headlines…
The Federal Reserve has been aggressively testing the various monetary tools that will give it additional flexibility during the rate normalization process. In addition to the Term Deposit Facility (see post), the Fed recently started testing the term reverse repo facility (Term RRP – see statement). Note that this is in addition to the Overnight RRP….
It’s been a rough run for Brazilian state-controlled oil giant Petrobras (PBR). The stock has been in almost continuous decline since late 2009 and its U.S.-traded ADR has lost nearly two-thirds of its value since July. This is a stock that was trading at over $70 per share in mid-2008. It now trades for barely one tenth…
As promised below, I have written something about investment (warning google document) In the note, I calculate some variables related to discounted future profits. Here is a snip from the paper in which I define them. Standard micro founded models of investment are based on shareholder value maximization and assume that there are adjustment costs, so…
Welcome to edition 234 of Insider Weekends. In a week where we saw the Dow post its biggest weekly decline since 2011, insider buying more than quadrupled with insiders buying $190.94 million of stock compared to $44.02 million in the week prior. Part of this buying was driven by insiders from the energy sector as we…
For months, our computer has been targeting next week – the week of December 15th. This target appears poised to present a low perhaps on Monday, which is also a panic cycle target. We can see that the Dow has remained nicely within the upward channel. So far it…
