S&P 500 Bull 3x (SPXL) - SPXL bounced in the mid $70's on Monday and is back up near $80 on Tuesday. Small Cap Bull 3x (TNA) - TNA hit $69.43 on Wednesday. The decision by the couple, founders of a small German company called BioNTech, gave birth to Operation Lightspeed-in which the scientists in the company diverted all their resources from cancer therapy research to finding a vaccine to stop COVID-19. If there is a weak growth rate or high inflation, keep an eye on big companies, because in such a situation, the share of large companies is in good condition compared to the small and mid-sized companies. The portion of a company's profit allocated to each outstanding share of common unique boutique . stock market crashes do happen. These periods have been associated with either bear markets or corrections as the market digests an uncertain earnings outlook. Last week, I highlighted analysis from John Butters of Factset on the US earnings season and outlook. In the past week, I have seen a couple of indications that the weakness was attributable to hedge fund re-positioning their portfolios.
Then last week, AbbVie halted its announced inversion transaction with Shire, inflicting great pain on the arbitrage community. Forget the fact that people make choices and choose how to spend their money.She thinks that because you prepare for YOURSELF and YOUR FAMILY and not the community as a whole you are being selfish. Needless to say, this regulatory uncertainty (along with prior detours from the rule of law) will be a wet blanket on top of investors until transparency and a level playing field are restored to the markets. The 200 day should act as a nice support level going forward. The SPX is now testing an important resistance level. How much money will you have in savings when you retire 15 years from now? The fast money market reaction is exemplified by the events on Thursday night and Friday. As for last week's market activity, Jones said that on Thursday we saw a five standard deviation (that's a volatility measure) kind of movement in one day.
One of the steadiest technology companies on the TSX, Open Text (TSX:OTEX)(NASDAQ:OTEX) continues to be a top pick of mine for investors. In early October, a confluence of events transpired in relatively short order, including weaker economic data, political uncertainty, a potential global plague, and bureaucratic meddling, which caused fear to spike, sentiment to decline, and investors to de-leverage. This process has often been tagged as transfer of shares from weaker hands to stronger hands. Buying 1000 shares of 50 dollar stock would be 50000 invested. By that time however, the big-time investors or as called the smart money segment will have sold the shares and have cashed in some of those unrealized paper-only profits. The de-risking sentiment that prompted investors to dump stocks, however, is likely to lose steam sooner, according to Credit Suisse Head of Flow Equity Derivatives Trading Khoa Le. The Trend Model trading call reversed itself and moved from a bearish to a bullish reading this week (see my tweet here).
The last report card of that account can be found here. Here is the updated Factset chart of how consensus forward 12 month EPS estimates are evolving (annotations in red are mine). I have highlighted in red previous episodes when the forward 12 month EPS estimates have rolled over. For investors, the current period of stalling forward EPS growth is not a signal for panic, as forward EPS does not appear to lead the stock market. Earnings Guidance: For Q4 2014, 29 companies have issued negative EPS guidance and 8 companies have issued positive EPS guidance. For the last few weeks, I have been struggling with a rationale for the most recent episode of stock market weakness. Speaking of the volatility of the past two to three weeks, he said that was due to position clearing and that it was similar to October 1998. (Our source pointed out that's when the Long-Term Capital Management event happened.