You may have heard some of the statistics before. Less than 10% of Brazil’s roads are paved. More than 1/3 of India’s population lives without electricity in the home. And roughly 50% of Indonesians in the city of Jakarta (50%) do not have running water. In essence, if emerging markets are going to genuinely emerge, they’ll need to modernize. [...] Continue Reading...
You don’t have to agree with every aspect of “Dow Theory” to appreciate one of its most venerable features. In particular, the Dow Jones Transportation Index should lead the way higher for the Dow Jones Industrial Average. Why has this particular axiom maintained a level of popularity for more than a century? In essence, transporters “take” materials to [...] Continue Reading...
Financial stocks rocketed ahead in the first quarter and Bank of America (BAC) recently received a high-profile upgrade. So why is the SPDR Select Sector Financials Fund (XLF) one of the worst performers over the last 5 days? Aluminum giant, Alcoa, surprised Wall Street with its stronger-than anticipated earnings report. So why is the SPDR Select Sector [...] Continue Reading...
My clients have benefited from a healthy slice of exposure to risk in 2012. Top ETF holdings include assets like SPDR S&P China (GXC), Vanguard Dividend Growth (VIG), iShares High Yield Corporate (HYG) and Vanguard Growth (VUG). My income-oriented winners like JP Morgan Alerian MLP (AMJ) and PowerShares CEF Income (PCEF) have been noticably slower on the [...] Continue Reading...
Analysts have already lowered 2012 profit estimates for the S&P 500 from the 9% range down to the 6% range. Granted, profits may still be rising. But what could happen to stock prices when profits are climbing at a slower pace? And what happens if the manufacturers who are producing at a slower pace ultimately find themselves shipping less goods? In Dow Theory, [...] Continue Reading...
In 2011, S&P 500 profits expanded 15%. And yet, the benchmark’s price finished in the very same place that it started the year. In essence, since prices flat-lined and earnings experienced double-digit growth, a fundamentally inexpensive stock market via the price-to-earnings ratio (P/E) became even cheaper. The most common reason cited for P/E contraction in 2011? The Euro Zone debt crisis. Obviously, sovereign [...] Continue Reading...
On the first day of December, 2011, a number of brand name corporations hit new 52-week highs. Here are a few that caught my eye: McDonalds (MCD), Phillip Morris (PM), Diageo (DEO), Kraft (KFT) and Treehouse Foods (THS). Keep in mind, most of the media attention centers on the discretionary spending of the consumer (e.g., “Black Friday” widescreens, ”Cyber Monday” acquisitions of [...] Continue Reading...
The number “88″ means a lot of different things to different people around the world. For some, it expresses the notion that the universe is both infinitely large and infinitely small. Others see it as a message of eternal love. Meanwhile, Chinese culture recognizes “8″ as its luckiest number, with “88″ symbolizing even greater fortunes. However, 8/8 is a rather dismal date for the [...] Continue Reading...
One of the “constant” declarations of the current earnings season? Of those reporting, roughly 3/4 of corporations exceeded profit-per-share estimates. On the other hand, it’s not uncommon for 2/3 to 3/4 of companies to beat lowered expectations; key executives help to create “beatable” numbers. In addition, each of 8 major economic sectors typically have corporations that, historically speaking, raise the earnings-per-share [...] Continue Reading...
Scores of investment gurus live on momentum and relative strength. They may advocate investing solely in those assets that have put together streaks over 4, 8 and 12 weeks (3 months). Other media darlings don’t care what happens in a shorter period. They may run with a particular theme for decades. For instance, Jim Rogers likes commodities and the China [...] Continue Reading...
