The cloud stocks in the Nasdaq are a big ass bubble, the rest are not too bad.
Who knows when it corrects... but when it (SPY) does, I am buying the dip.
Stock market as a whole is the best 'store of value'.
Stimulus checks and enhanced unemployment benefits are here to stay.
(cause apparently everyone is suffering sooo much)
Ultimately all that extra money flows thru Wall Street
Put your money in SPY and set it and forget it
Who knows when it corrects... but when it (SPY) does, I am buying the dip.
Stock market as a whole is the best 'store of value'.
Stimulus checks and enhanced unemployment benefits are here to stay.
(cause apparently everyone is suffering sooo much)
Ultimately all that extra money flows thru Wall Street
Put your money in SPY and set it and forget it
No one would've thought a year ago that the DOW would be in the 34-35k range right now so it is tough to say.
I think the market will lose momentum when inflation picks up and it isn't transitory, thus the fed has to fight it...A real rock and a hard place scenario
Other than that, who knows, you can go QE-infinity for a long time and the only way they will prick the wealth effect bubble is if forced to. The economy would be fucked w/ any kind of real austerity or quantitative tightening
Doubt that is on the horizon though. And a 20-25% downturn in SPY is really nothing after the runup we've had.
I think the market will lose momentum when inflation picks up and it isn't transitory, thus the fed has to fight it...A real rock and a hard place scenario
Other than that, who knows, you can go QE-infinity for a long time and the only way they will prick the wealth effect bubble is if forced to. The economy would be fucked w/ any kind of real austerity or quantitative tightening
Doubt that is on the horizon though. And a 20-25% downturn in SPY is really nothing after the runup we've had.
VIX isn't somerthing you hold over any type of long-term horizon, it decays thus eroding its value. It is a trading instrument.
https://www.investopedia.com/investing/use-vix-etf-in-your-portfolio/
If you wanna short the market, you should buy put options. Even that is dicey though, most options expire worthless.
If timing the market was easy, even a loon like SmallDaddy would be rich.
> Why Is the Stock Market Down Today? Because It’s Not Just Tech Stocks Anymore.
Last Updated: May 11, 2021 at 11:15 a.m. ET First Published: May 11, 2021 at 10:58 a.m. ET By Jacob Sonenshine
Referenced Symbols
Markets Now Down
What started as a selloff in tech stocks has become a general market rout as risk-averse investors dial back their equity holdings.
All three major U.S. indexes were solidly in the red. The Dow Jones Industrial Average has dropped 496.49 points, or 1.4%, while the S&P 500 has fallen 1.5%, and the tech-heavy Nasdaq Composite has declined 1.6%. While tech stocks had been leading the way down, Tuesday’s drop is characterized by more general weakness, with almost 90% of S&P 500 components trading lower, according to FactSet.
Here are three reasons the stock market is falling:
Inflation fears. Everyone is suddenly concerned about inflation. Recent economic data show that companies are paying higher prices for their raw materials due to supply shortages, and are raising prices to cover the higher costs. Can you say inflation? If inflation is real, the Federal Reserve could be forced to raise interest rates sooner than anticipated—or at a faster pace once they start hiking, according to former New York Fed President Bill Dudley. Higher rates, generally, are worse for growth stocks, because it raises the “discount rate” used to value their stock, and decreases the value of their future cash flows. “If supply disruptions persist and demand remains firm, the Fed might need to tighten monetary policy faster than expected,” writes Dennis DeBusschere, head of portfolio strategy research at Evercore. “That theory seems to be driving market volatility higher and tech stocks lower.”
It’s not just tech stocks. If recent weakness had been primarily in tech stocks, today’s is broad based. That points to a second problem caused by inflation, DeBusschere notes: That rising prices will mean consumers have fewer discretionary dollars to spend, and that means growth will be slower, something that would hurt economically sensitive value stocks more than growth stocks. It’s one reason the Dow might be down more than the Nasdaq today, though the fact that the Nasdaq has sold off more recently is also a factor.
Investor sentiment. After a period of extreme bullishness, investors have been feeling less confident about stocks. Data from the American Association of Individual Investors show the percentage of bulls minus bears is at 24 percentage points, down from 30 points two weeks ago. That 30-point level is important. It’s fairly rare, and when it’s triggered, the S&P 500 has been roughly flat over the following three months, on average, and up just 1% for over the following year, according to RBC Capital Markets data.
Write to Jacob Sonenshine at jacob.sonenshine@barrons.com
Last Updated: May 11, 2021 at 11:15 a.m. ET First Published: May 11, 2021 at 10:58 a.m. ET By Jacob Sonenshine
Referenced Symbols
Markets Now Down
What started as a selloff in tech stocks has become a general market rout as risk-averse investors dial back their equity holdings.
All three major U.S. indexes were solidly in the red. The Dow Jones Industrial Average has dropped 496.49 points, or 1.4%, while the S&P 500 has fallen 1.5%, and the tech-heavy Nasdaq Composite has declined 1.6%. While tech stocks had been leading the way down, Tuesday’s drop is characterized by more general weakness, with almost 90% of S&P 500 components trading lower, according to FactSet.
Here are three reasons the stock market is falling:
Inflation fears. Everyone is suddenly concerned about inflation. Recent economic data show that companies are paying higher prices for their raw materials due to supply shortages, and are raising prices to cover the higher costs. Can you say inflation? If inflation is real, the Federal Reserve could be forced to raise interest rates sooner than anticipated—or at a faster pace once they start hiking, according to former New York Fed President Bill Dudley. Higher rates, generally, are worse for growth stocks, because it raises the “discount rate” used to value their stock, and decreases the value of their future cash flows. “If supply disruptions persist and demand remains firm, the Fed might need to tighten monetary policy faster than expected,” writes Dennis DeBusschere, head of portfolio strategy research at Evercore. “That theory seems to be driving market volatility higher and tech stocks lower.”
It’s not just tech stocks. If recent weakness had been primarily in tech stocks, today’s is broad based. That points to a second problem caused by inflation, DeBusschere notes: That rising prices will mean consumers have fewer discretionary dollars to spend, and that means growth will be slower, something that would hurt economically sensitive value stocks more than growth stocks. It’s one reason the Dow might be down more than the Nasdaq today, though the fact that the Nasdaq has sold off more recently is also a factor.
Investor sentiment. After a period of extreme bullishness, investors have been feeling less confident about stocks. Data from the American Association of Individual Investors show the percentage of bulls minus bears is at 24 percentage points, down from 30 points two weeks ago. That 30-point level is important. It’s fairly rare, and when it’s triggered, the S&P 500 has been roughly flat over the following three months, on average, and up just 1% for over the following year, according to RBC Capital Markets data.
Write to Jacob Sonenshine at jacob.sonenshine@barrons.com
Yeah, problem with the ETF's is they do decay so it eats value over time. Just tough to make $ on those unless A. a huge black swan happens or B. you time it perfectly
We'll see what happens, every bum in the world has 5-20k in their pockets right now ready to ball out as restrictions ease. That's gonna show up in corporate profits.
I think the major headwinds are probably closer to 10-15 months away.
I've got a lot of XOM so hope oil can catch a bid on the inflation wave. Should be a ton of demand + lack of supply over the next year.
I definitely think the fed will just say the inflation is transitory and let it run for awhile, they're not gonna wanna prick the bubble. Powell already learned the hard way in late '18 how fragile the whole system is and pivoted to cutting rates/bond buying in '19.
Who knows though, nothing would surprise me, this has been quite the monetary experiment.
Who knows though, nothing would surprise me, this has been quite the monetary experiment.
these economists have no idea what tomorrow will (SPY) bring, they are sharing an OPINION, just sayin'. Let's not forget, everyone and their grandmother was calling for a collapse last yr, that didnt happen--V-shaped , crazy .End of the day, no one knows .......................... hints with the candles for areas of possible reverse
. Some big dark pool prints did go off on the spy, but not seeing it in multiple days (dark pool prints i'd take as way more influential then an economist's opinion, this is real cash move by folks with large pockets)SPY
6 mth daily
think i posted this in the other thread, no idea what happened to that thread. Did say then , and i'll repeat-- a juicy site for a pullback is to an area of confluence . Look at how it has respected its 50 SMA ( a decisive breach of this esp., a gap down through , wuold not be good for the bulls, your vxx will have a party).................. A gap to be filled at $400 AND wuold intersect with the 50 sma, hopefully a beauty of a candle for entry , esp., on the weekly chart. $390-$395 zone has a lot of action there, going to need some nutty news to break that
a gap fill at $400 would amount to a 5% pullback which happens historically 3x a YEAR since 1920.
bounced right off $410 today as it did in april, today was a violent gap down--maybe seeing some exhuastion in the banks, and energy (double top with XLE)
'Look at how it has respected its 50 SMA ( a decisive breach of this esp., a gap down through , wuold not be good for the bulls, your vxx will have a party).................. A gap to be filled at $400 AND wuold intersect with the 50 sma,'
Gas, was set for ------' a decisive breach of this esp., agap down through , wuold not be good for the bulls, your vxx will have a party'...........was set for that Wed night-------- didnt happen. Bad economic news is driving the market higher , lol
Gas, was set for ------' a decisive breach of this esp., agap down through , wuold not be good for the bulls, your vxx will have a party'...........was set for that Wed night-------- didnt happen. Bad economic news is driving the market higher , lol
