Does The Market Have Room To Rise Or Is It Finally Going To Pullback?

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Good morning and thank you for reading this week’s Monday Morning Market Commentary. I hope everyone enjoy Mother’s Day the weekend before last and I want to thank so many of you for the kind emails, wishing Beth Ann a Happy First Mother’s Day! We had a wonderful time and she was very thankful that I spent all weekend with her and Madison. Also, for all those that filled out the client survey, thank you. I really appreciate your feedback and will be making some changes to how we work because of it.

Now onto the markets for the last two weeks. Even with so much bad news coming out about our economy and the global economy, stocks have continued their swift ascent. These past two weeks looked very similar to many of the weeks we have seen this year, with stocks pushing high into the midweek, pulling back a little midweek, and then rising to close high on Friday. The S&P 500 rose over 3% over the last two weeks, closing at 1,667.47 on Friday.

Bond yields followed along with the S&P 500, rising to just over 1.9% throughout the week. Although bond yields have diverged severely from stocks the last few years, we have seen them start to move in unison again the last few months. The 10-yr Treasury went from 1.75% two Fridays ago, to close at 1.95% this past Friday, quite a big jump over 2 weeks. Continue reading →

Stocks Hit New Highs Even As Economy Shows Signs of More Weakening

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Good morning and thank you for reading this week’s Monday Morning Market Commentary. As I talked about in last weeks commentary, this week was a VERY important week for the markets as we had a lot of economic reports coming out. By looking at the markets, you wouldn’t be able to tell that most of the reports showed the US economy is continuing to slow down, as stocks held up throughout the week and ended up closing at another all-time high. Bond yields followed a similar pattern for the week but are still well off their highs for the year.

All this has led to a change in our outlook for a few sectors/regions of the markets. I will be sending out an update to clients this week about changes we are recommending. Continue reading →

Stocks Make Lower Highs While Bond Yields Make Lower Lows… That’s Not Good

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Good morning and thank you for reading this week’s Monday Morning Market Commentary. This past week we saw stocks rise all week, even as we received more and more disappointing economic and earning reports. Bonds, however, did seem to notice all the disappointing reports as yields dropped to lows for the year.
Let’s first look at the chart of the S&P 500 from last week. As I said and you can see, stocks rose throughout the week, with Friday being the only down day. Most indices were able to get back half of what they had lost the previous week, but this marks a lower high for stocks, which isn’t usually a good sign. The S&P 500 finished at 1,582.24, or 1.74%.
This week we saw bond yields continue their divergence from stocks and bonds put in a low for yields this year. Bond yields were basically flat all week with the big drop came after we received the disappointing GDP report on Friday morning. The 10-year Treasury yield finished the week quite a bit lower, ending at 1.66%. Continue reading →

Stocks Give Back All Of Last Week’s Gains & Earnings Surprise To The Downside

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Good morning and thank you for reading this week’s Monday Morning Market Commentary. This past week we had the markets overshadowed by all the sad and scary events from the Boston Marathon bombing. My thoughts and prayers have been going out to the friends and families of everyone affected by this horrific event.
As for the markets, we had stocks take back all the gains they had in the previous week and bond yields drop back to a major resistance of 1.7%. As for economic reports, we had a ton of disappointing reports, as well as some pretty lousy earnings reports. I’ll talk about the disappointing earnings reports and some technical signals we’ve received confirmation of this past week. Continue reading →