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Economic Outlook

Trump Unveils New Tax Plan Ahead Of Mid-Terms


Posted by Fred Dunkley

on Tuesday, 30 October 2018 07:40

trump

Trump’s new 11th hour mid-term election rallying cry is again taxes, and this time it’s a deal for those who were left out of the last bonanza—the middle class. But the vague plan is being criticized as a fake, pre-election stunt at worst; and at best, something that could only happen next year, and only if Republicans maintain control Congress. CLICK for complete article



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Personal Finance

What You Need to Know


Posted by Ethan Dang of McIver Capital at Canaccord Genuity

on Monday, 29 October 2018 11:39

Stock Market

“Everyone wants happiness. No one wants pain. But you can't have a rainbow, without a little rain.” ― Anonymous

Global stock markets are in the midst of a pullback and corrections never feel good. In the short-term, investor sentiment can swing wildly, causing volatility in the markets. Psychology is an important part of investing and we can often be our own worst enemy in making sub-optimal decisions in times of volatility. This is due to the natural wiring in our brains, where fear triggers a flight instinct. Our brains also have a tendency to project recent trends into the future (recency bias), which collectively, can cause crowd sentiment to hit extremes. For long-term investors, empirical data and experience have shown that times of pessimism often present opportunities.

The current market pullback was triggered over fears of a prolonged trade war between the U.S. and China (tariffs), rising bond yields (tighter financial conditions), faster U.S. interest rate hikes (hawkish U.S. Federal Reserve) and so on. These factors can lead to slower global economic growth over time. As sentiment soured, selling in highly crowded trades, such as the FAANG (Facebook, Apple, Amazon, Netflix and Alphabet’s Google) stocks added fuel to the fire.

As of writing, North American markets are off 8-10% from their summer peaks and international developed markets (ex-Canada & U.S.) are off about 18% from their peaks. Markets are attempting to put together a short-term bounce, but the bounce has been weak thus far. This leads us to think that this pullback could go lower for longer. Some markets (such as S&P500, TSX, Japan) are trading at or near first support levels now, but if those supports are violated, markets could go lower from current levels.
The reason why your portfolios hold different asset classes is to provide negative correlation and it is during these times of stress that bonds and gold shine and the cash reserve provides dry powder to capture opportunities.

Longer term, stock valuation is mainly driven by corporate earnings and dividends. The earnings season is underway, and thus far, we are seeing strong corporate earnings (second best quarter in a decade). Companies in both the S&P 500 andTSX Composite are showing positive revenue growth (top line) and earnings growth (bottom line). Furthermore, corporate stock buyback programs are set to restart this quarter and are expected to provide support for the markets. Overall, economic data and indicators, such as consumer spending and business investments, suggest that this is still a healthy market pullback in the context of a late-cycle, bull market. We expect to see rotation into value and defensive sectors like health care and consumer staples as the cycle continues. The key to sound investing is to remain focused on the long-term horizon as short-term market volatility is inevitable and is part of investing.

Want to know about McIver Capital Management at Canaccord Genuity? Click here



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Stocks & Equities

FANGs Freefall Into Bear Market As Dip-Buyers Evaporate


Posted by ZeroHedge

on Monday, 29 October 2018 09:57

fang

But, but, but... it's different this time...CLICK for complete article



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Energy & Commodities

Oil Production On Federal Lands To Hit New Record


Posted by Irina Slav

on Monday, 29 October 2018 09:53

usoil

Crude oil production from onshore federal lands reached a record high over the first seven months of this year, New York Times’ Eric Lipton said in a tweet responding to a claim that oil production in Wyoming had peaked three years ago.

Lipton quoted data from the Department of the Interior, which has not been made public yet, as part of an investigation he and climate reporter Hiroko Tabuchi recently published about a second shale oil boom.... CLICK for complete article



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Stocks & Equities

Markets Open Flat After Last Week’s Dip


Posted by Paul Rejczak

on Monday, 29 October 2018 09:48

ticker

Stocks continued their downtrend on Friday, as investors reacted to Thursday's big cap tech stocks' quarterly earnings releases. The releases were quite good, but the weak future guidance mattered the most. The S&P 500 index fell below its Wednesday's local low. However, it was gaining at the end of the day. Was it a short-term bottom? CLICK for complete article



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On Monday from the morning high to the afternoon low the DJIA dropped over 900 points, then bounced over 300 points to “only” close down...

- posted by Martin Straith, Trend Technical Trader

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