Small-caps continue to act tentative. It is a group of stocks with the most exposure to the domestic economy, and their performance runs counter to the nearly-consensus view that the economy will do just fine next year. Oddly enough, small-cap … Continued
Small-cap bulls once again were forced to defend the lower bound of the 1700-1900 range in place since January last year. The Russell 2000 just does not respond to the optimistic growth forecasts in earnings for this year and particularly … Continued
Job openings are at record highs. If past is prelude, this leads to job creation. This time around, thanks to stimulus money, Americans do not seem desperate for jobs – unless wages rise enough to tempt them back into the … Continued
Equity bulls used the Yellen dip last Tuesday as an opportunity to add to risk, not reduce. The Fed is making sure liquidity remains plentiful, and the short end of the yield curve is cooperative. In this environment, VIX on … Continued
Small-caps and tech continue to diverge. Post-vaccine news, longs are gravitating toward the former and leaving the latter. Amidst this, signs of fatigue are also showing up on the S&P 500, while VIX acts like it wants to rally. The … Continued
Last week, the S&P 500 as well as the Nasdaq 100 started out strong but finished poorly. The Russell 2000, on the other hand, stayed strong, closing near the week’s high. Before one interprets this as markets’ way of telling … Continued
In the current bear market, the S&P 500 is down nearly 34 percent, which is the 8th worst out of 14 going back to 1929. It is too soon to say if THE low is in. After the March 23rd … Continued
Small-business optimism continues to remain near all-time highs, although several sub-indexes are diverging, including profit trend, which the Russell 2000 closely tracks. The NFIB optimism index rose 1.4 points month-over-month in July to 104.7. This was the 32nd consecutive month … Continued
June’s stronger-than-expected payroll print has the potential to change the Fed’s interest-rate outlook for the remainder of the year. Markets still expect at least two 25-basis-point cuts this year, including one later this month. Should Chair Jay Powell wish to … Continued
The FOMC meets this week. No change in expected. But in the remaining four scheduled meetings, markets have priced in at least two cuts. The Fed has a juggling act in hand. The unemployment rate is near a six-decade low, … Continued