Weekly Market Call – 6.29.2018

 

Take a look at my June 29th weekly analysis and trade smarter.

Here is the rundown…

Are we late in the economic cycle? Concerns over fears of the fed tightening too much are leading to worry.

Trade and technology restrictions are the biggest concern as the market doesn’t like excessive tariffs or restrictions on trade.

In technology this past week, oil prices, utilities, and real estate defensive sectors were moving higher.

The banks got a bit of relief from the government this past week. The federal reserve said the top 35 banks are looking great with regards to a stress test. Withstanding a recession well, they gave banks the go-ahead to increase buybacks and raise dividends.

Wells Fargo was a beneficiary even though they had been scrutinized for scandals and unfair sales tactics that were hurting the companies reputation. The government restricted them more and increased fines but this will be a relief for them as their stocks were up over 4%.

The breadth numbers are slightly to the bullish side, but many of the market indicators remain mixed. For example, the sentiments market and emerging markets risk of failing aren’t showing optimism.

Yield spreads, credit spreads, and junk bonds vs AAA bonds are optimistic from a sentiment perspective.

Stock market price patterns have been in a consolidation phase and a period of indecision so this week might be a little rough because of how Friday ended.

Positives: I like what is happening with the banks and there are some pockets of value that can be found. Take a look at Hostess Brand Inc. and the research exposé that we did on them.

Happy Trading!

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