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It’s the last day of October for stocks and the markets have enjoyed an anxiety-ridden climb toward all-time highs, but if this statistical trend for equity benchmarks holds up, there is much more room to run.

Dow Jones Data Group data going back to 1950 indicates that when the Dow Jones Industrial Average and the S&P 500 index are up as sizably at the end of October as they are now, positive returns for the rest of the year are all but assured.

And those gains, historically, are remarkably stellar.

Specifically, when the Dow is up by at least 15% for the calendar year through the end of October, the index boasts an average return of 5.55% over the next two-month period, with an average year-to-date return of 27.17%. The Dow was up 15.94% thus far in 2019 as of Thursday’s close.


     
Source: Dow Jones Market Data


Similarly, when the S&P 500 has gained at least 20% through Oct. 31 — it is up 21.17% thus far, as of Thursday — the benchmark’s return is 6.21% on average for the remaining period, with an average full-year gain of 33.8%.


           
Source: Dow Jones Market Data


Although the Nasdaq doesn’t boast as impeccable a record, the index has gained 90% of the time when it is up by at least 20% at this point in the year (as of Thursday, it is up 24.97% so far in 2019), data show, with an average return of 7.48% for the remaining two months and a year-end gain of 42.81%.

To be sure, past results are absolutely no indication of future returns and U.S. stocks on Thursday fell amid growing worries about the likelihood that the U.S. will be able to carve out a genuine trade agreement with China soon and as an impeachment-inquiry vote tied to President Donald Trump was passed in the House.

That weakening comes a day after the S&P 500 index scored a record close in the wake of a Federal Reserve’s decision to cut interest rates for the third time this year, while also signaling that it would pause before making any further moves on monetary policy.

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Having run a gantlet of political worries, including the U.S. trade dispute with China and Britain’s long-disputed plan to exit from the European Union, all three benchmarks are on pace to end a historically volatile period for stocks in positive territory. The Dow finished up 0.48% in October, the S&P 500 boasts a 2.04% month-to-date gain, and the Nasdaq jumped 3.66% in October.

October trading didn’t begin on a strong note, though, the Dow, S&P 500 and Nasdaq registered back-to-back losses of at least 1% before steadying at the start of the month.

Now, stocks enter what’s historically been a strong period for equity markets. Data show that November through January is the strongest three-month span of the year, with average gains in November at 5.94% and, in December, 5.1%.

           
Source: Dow Jones Market Data

Source: https://www.marketwatch.com/story/the-stock-market-is-guaranteed-to-rise-at-least-another-5-in-the-next-2-months-if-this-70-year-old-trend-holds-2019-10-31

 Have a fantastic day and I hope today’s article helps.

The post Dow and S&P 500 are guaranteed to rise at least another 5% in the next 2 months — if this 70-year-old pattern holds appeared first on Trading Concepts, Inc..

The stage appears to be set for stocks to shine after the Federal Reserve’s third rate cut this year and its signal to stop from now. And certain groups of stocks stand to benefit the most, if history is any guide.

The Fed slashed interest rates for the third straight time on Wednesday while indicating it is going to pause easing. Powell made it clear in the press conference that the current monetary policy stance is “likely to remain appropriate.”

The three-and-done approach was used on two occasions in history — between 1995 and 1996 and in 1998. The Alan Greenspan-led Fed slashed rates by a total of 75 basis points during both periods to combat an economic downturn and successfully prolong the expansion.

The Fed’s insurance easing episodes in the 1990s managed to drive the S&P 500 22% higher on average a year after the third cut, CNBC analysis found. The move was particularly beneficial for cyclical stocks — including tech, energy and industrials — as investors bet on economically sensitive pockets of the market after Fed rate cuts.

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CNBC, using hedge fund analytics tool Kensho, found that information technology stood out as the best-performing sector after the central bank cut rates three times and paused, surging a whopping 66% a year after the third cut on average. Energy and industrial stocks jumped about 24% on average during the same period.

It’s not surprising that cyclical stocks have historically enjoyed the biggest boost from Fed rate cuts. As monetary easing is designed to jolt the economy, investors tend to gravitate toward stocks traditionally correlated to economic growth.

To be sure, the tech sector’s stunning pop in the 1990s happened when there was a rapid rise in U.S. tech stock valuations at the height of the dot-com bubble. So the Fed cut should have less of an impact on the group this time.

Source: https://www.cnbc.com/2019/10/31/these-stocks-can-surge-the-most-when-fed-cuts-rates-three-times-and-pauses.html

Have a fantastic day and hope this helps your strategy in making money.

The post These stocks were big winners when the Fed jolted the economy with three rate cuts in the ’90s appeared first on Trading Concepts, Inc..

The stock plummeted earlier this week even though the company posted great earnings, had a positive operating margin, and raised its full-year guidance, that wasn’t good enough for the Street. The company earned a profit of $4.1 million, or six cents a share on sales of $92 million.

That’s up substantially from a loss of $9.3 million on sales of $26.43 million year over year. 

Analysts were looking for four cents on $82.2 million in sales. 

Then, the company increased its annual revenue forecast for the second consecutive quarter, now expecting full year sales of between $265 million and $275 million.

However, even with all of that great news, the stock dropped nearly 20% on the day thanks in part to lock-up expiration, allowing insiders to sell.

One insider with no intention of selling is CEO Ethan Brown, who noted he’s not touching his shares and is focused on growing the company to a $40 billion company. 

That pullback may lead to opportunity.

Remember, Research and Markets’ analysts expect the meatless-market to increase from $4.6 billion to $6.4 billion by 2023. Beyond Meat thinks that number could rocket to $35 billion in the U.S. Plus, not only is McDonald’s jumping on board, so is Dunkin.

In fact, Dunkin moved up its nationwide launch of its Beyond Sausage in 9,000 locations after a test in New York earlier than expected.

This is just one of the opportunities we find quite often inside Extreme Option Profits.

PS. Be sure to come back Tuesday for our next Chart of the Day!

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The post Chart of Day… Beyond Meat appeared first on Trading Concepts, Inc..

If the market was giving out grades, Fed Chairman Jerome Powell would have aced his handling of a difficult policy transition, from cutting interest rates to doing nothing at all for what could be a long time.

Unlike other meetings, the Fed chairman delivered no gaffes that sent markets reeling, something that had been expected by some market pros.

The Fed cut its fed funds target rate Wednesday to 1.50% to 1.75% in its third quarter point rate cut in so many meetings. It also made a critical language change in its statement, signaling it was stopping rate cuts for now. The Fed dropped the phrase that it would “act as appropriate” to sustain the recovery, and said instead that it “will assess the appropriate path of the target range” for fed funds.

Powell reaffirmed that comment several times during his press briefing. More than once, he said the Fed would keep its policy steady as long as there are no threats to its outlook for a moderately growing economy, strong labor market and inflation near its target 2% target. In fact, he added that it would take a “really significant move up” in inflation for the Fed to return to raising rates.

“I think he’s doing a great job. First of all, I think he’s doing 100% the right things,” said Rick Rieder, BlackRock’s global CIO of fixed income. “Clearly uncertainty in the world required him to drop rates ... He said it was a mid-cycle adjustment, and mid-cycle adjustments have been a 75 basis point move, and that’s what they’re doing. And now they’re putting liquidity in the system, and that’s taking pressure off the dollar.”

Powell also discussed the Fed’s activity in the short-term lending market. The Fed plans to operate a backstop facility until January, after a spike in rates last month, due to what seems to have been a temporary cash crunch. The short-term lending market, or repo, is where banks go to fund themselves. The Fed also is expanding its balance sheet, or adding liquidity to the markets, by temporarily purchasing Treasury bills.

“If something causes us to materially reassess our outlook that’s what would cause us to change our view from the appropriate stance of policy,” Powell said.

Art Cashin, director of floor operations at UBS, said it was Powell’s inflation comment that triggered a rally in stocks. “He did very well. He kind of let them know he’s not thinking of any rate hikes unless inflation begins to take off. He basically said we’re only going to go two ways, either sideways or down,” said Cashin.

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The S&P 500 rose 9 points to a new high of 3,046. Treasury yields initially rose on the news but backed off again, and then fluctuated several times. The bond market had been expecting a hawkish announcement

“I think what it means is we’re going to be in a stable rate range for a while. It would have to be a significant shock to the system for him to drop rates again. They’re not going to raise rates for a long time, which is what I think is the right call,” Rieder said. “Negative interest rates don’t make sense and he’s stopping short of getting close to the zero bound, which he should...I think people realize in the market that they’re standing ready to act and they don’t need to do more right now.”

Drew Matus, chief market strategist at MetLife Investment Management, said Powell got the market reaction he was looking for. Powell, who has made some communications blunders, was able to shift Fed policy without rocking markets.

“I think they gave the market what they wanted. They got the rate cut but they also got the signal that the Fed was going to pause and the bar for further action is moving higher,” said Matus. “They sound like parents talking to kids. Last time, it was ‘we’re going to have dessert’ and this time it’s ‘we’ll see after you eat your dinner.’”

Powell has been criticized by Trump and White House officials for not being more accomodative, even when he was cutting interest rates.

“From what I see in the economy— and I’m sure he’ll get criticized— it’s exactly the right set of decisions, and I give him a lot of credit for making a bold call,” said Rieder. “Trade was more uncertain a few months ago. Brexit was more uncertain.”

“I think the market is saying it’s all good. I’m okay taking risks, and I’m okay being in the pool because i know they’re going to put a blanket of support under it if they need to,” Rieder said.

Rieder said in the current environment he favors bonds at the front end of the curve, like the 2-year note.

“They’re not going to raise rates for a long time. If the economy softens, they’re going to cut them. I love the front end ... the curve should steepen here,′ said Rieder.

The 2-year yield moved to a high of 1.66% while Powell was speaking, but it backed off. The 10-year was at 1.77%, off several basis points after the Fed statement.

“I think the 10-year is in a range, but I don’t think rates are going to move significantly lower at the long end of the curve..If anything they could move higher and the curve could steepen from here,” Rieder said.

Market pros noted Powell was careful to stay on message. His prior gaffes include a comment last October that the Fed was a long way from neutral, when it was near the end of its rate hiking course. In May, he also spooked markets by saying he thought low inflation was transitory, at a time when investors were looking for a rate cut.

This time, Powell seems to have delivered the message he wanted to send.

“He jumps around a lot, but at the end of it all, I think he gets the market right where he wants it,” said Jim Schaeffer, deputy CIO at Aegon Asset Management. “Don’t expect a cut, but I’ll be there if we need to.”

Sourcehttps://www.cnbc.com/2019/10/30/fed-moves-to-assess-rate-policy-a-hawkish-signal-expected-by-markets.html

Have a genuinely great day and I hope today’s trading article helps you.

The post Powell aces tricky Fed transition to ending interest rate cuts, doing ’100% the right things’ appeared first on Trading Concepts, Inc..

Apple Inc.’s iPhone sales completed a year of declines in a Wednesday earnings report, but the drop may have been much worse if it were not for a seemingly booming trade-in program.

Apple executives said in a conference call Wednesday that trade-in volume quintupled from the year before in the fiscal fourth quarter, after divulging the same level of growth in July. While iPhone revenue still declined 10.3% from the year before — the fourth consecutive quarter of declines — it came in ahead of expectations and helped Apple top its own sales forecast.

Apple’s trade-in offer allows customers to sell an older iPhone back to Apple and use the proceeds to get a new iPhone cheaper, a must for many consumers after Apple jacked up their prices two years ago. An increase in trade-in activity suggests more upgrades are happening, which Apple must encourage to keep iPhone revenue steady and avoid down periods.

One of the biggest factors in the current boom in trade-ins is likely from China, where Apple established the program in Apple retail stores this year while also adjusting its pricing. The effects were seen immediately: In the first half of the fiscal year, Apple’s sales in greater China fell 24.5%, but that decline was cut to 3.2% in the second half of the fiscal year after the trade-in program and pricing changes were fully implemented.

“The things that we’ve done from a pricing and monthly payments point of view and trade-in, getting the trade-in program up and running, all of these things have moved the dial,” Chief Executive Tim Cook said in response to a question about Apple’s performance in China on Wednesday’s conference call.

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After lowering some prices with the new iPhone 11 family of smartphones, which seem to be popular, the confluence could lead to a huge round of upgrades in China despite tariff fears. Wedbush analyst Daniel Ives told MarketWatch that trade-ins overall have grown to 15% to 20% of upgrade activity from 5% to 7% a year ago. In China, he believes there are 60 million to 70 million iPhones that could stand an upgrade, and iPhone demand is tracking 15% to 20% higher than expectations.

“For Apple, the No. 1 focus is putting a fence around their install base, and what you’re seeing with the trade-ins is that it’s driving significant upgrade opportunity,” Ives said in a brief phone interview Wednesday afternoon, adding that “pricing was just pure genius in China.”

The concern with the trade-in program has been a potential decline in Apple’s obese margins on the iPhone, and gross margin did decline to 37.81% in the just-completed fiscal year from 38.37% the year before. Apple will take the slight decline in iPhone gross margin in exchange for greater revenue, however, especially with a growing services business that has even fatter margins.

“The bears were hanging their hat on margins, but now when you look at these numbers, the bears are going into hibernation,” said Ives, who has an outperform ratings and $265 price target on Apple stock.

Apple’s revenue and profit declined in the 2019 fiscal year, but not by as much as expected before Wednesday’s fourth-quarter numbers. To turn that trajectory around, with Apple’s services revenue hitting records and continued growth from wearables such as Airpods and Apple Watch, the company really just needs to maintain iPhone revenue while not destroying profit margins. Judging by Wednesday’s results, trade-ins have Apple on the path to accomplishing that.

Source: https://www.marketwatch.com/story/the-iphone-trade-in-program-is-booming-and-saving-apples-earnings-2019-10-30?mod=home-page'

Have a wonderful day and I hope this helps.

The post The iPhone trade-in program is booming, and saving Apple’s earnings appeared first on Trading Concepts, Inc..

U.S. markets were tepid ahead of the Fed’s decision on interest rates with the major averages showing weakness on the open but some strength ahead of the news. As expected, a quarter-point reduction was announced with the action muted as Wall Street awaited further developments.

Fed Chairman Jay Powell’s comments afterwards were once again scrutinized but this time helped sentiment as the major indexes pushed session highs in the final hour of trading. More importantly, volatility closed below another key level of support and is confirming a continued breakout to fresh all-time highs for the market.

The Dow added 0.4% following the late day push to 27,204. Lower resistance at 27,200-27,400 was cleared but held for the 3rd-straight session with a close above the latter and the all-time high at 27,398 signaling blue-sky territory towards 27,600-27,800.

The Nasdaq climbed 0.3% after testing a 2nd half high of 8,315. Current and lower resistance at 8,300-8,350 was cleared and held with a close above the latter and the all-time high at 8,339 getting 8,450-8,500 in play.

The S&P 500 was also up 0.3% after trading in a 25-point range while tapping a fresh all-time high of 3,050 ahead of the closing bell. Lower resistance at 3,050-3,075 was cleared by a tenth-point but held with a upside potential towards 3,100-3,125 on a close above the latter.

The Russell 2000 lost 0.3% while trading in negative territory throughout the session with the low reaching 1,562. Near-term and upper support at 1,565-1,550 was breached but held with a move below the latter being a slightly bearish development for additional weakness towards 1,540-1,525 and the 200-day moving average.

Utilities and Real Estate paced sector leaders with gains of 0.9% and 0.7%, respectively. Energy and Financials were the only sector laggard after falling 2% and 0.1%, respectively.

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ANALYST UPGRADES/DOWNGRADES

AMD (AMD) upgraded to Buy from Hold at Loop Capital and CFRA
Biogen (BIIB) upgraded to Outperform from Market Perform at Bernstein
Microchip (MCHP) upgraded two notches to Strong Buy from Market Perform at Raymond James

GrubHub (GRUB) downgraded to Neutral from Buy at Goldman Sachs
Ingersoll-Rand (IR) downgraded to Hold from Buy at Deutsche Bank
Werner (WERN) downgraded to Hold from Buy at Stifel

THURSDAY'S EARNINGS ANNOUNCEMENTS  
Before the open: Allegheny Technologies (ATI), Bristol-Myers Squibb (BMY), Celgene (CELG), Dunkin' Brands Group (DNKN), Estee Lauder (EL), Generac Holdings (GNRC), Imax (IMAX), Lumentum Holdings (LITE), MGP Ingredients (MGPI), Parker-Hannifin (PH), Quanta Services (PWR), Sanofi (SNY), Terex (TEX), Wayfair (W), Yeti (YETI), Zix (ZIXI)

After the close:  Avis Budget Group (CAR), Bruker (BRKR), El Pollo Loco Holdings (LOCO), Fluor (FLR), Gaming and Leisure Properties (GLPI), Hilltop Holdings (HTH), j2 Global Communications (JCOM), Live Nation Entertainment (LYV), MercadoLibre (MELI), National Storage Affiliates Trust (NSA), Open Text (OTEX), Pinterest (PINS), Qorvo (QRVO), RE/MAX Holdings (RMAX), SS&C Technologies (SSNC), United States Steel (X), USA Truck (USAK), Western Union (WU)

THURSDAY'S ECONOMIC NEWS
Challenger Job-Cut Report - 7:30am
Jobless Claims - 8:30am
Personal Income and Outlays - 8:30am
Employment Cost Index - 8:30am
Chicago PMI - 9:45am
Farm Prices - 3:00pm

METALS / OIL
Gold closed at $1,496.70 an ounce, up $6.00
Silver settled at $17.87 an ounce,  up $0.04
Copper finished at $2.68 pound, down $0.01
Crude Oil  was at $55.90 a barrel, down $0.64
Bitcoin Investment Trust (GBTC) ended at $10.85 down $0.14


I hope this helps you prepare for the trading day. Make it a great one!


   Todd Mitchell


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The post Bulls Rally in Final Hour as Fed Cuts Rates appeared first on Trading Concepts, Inc..

U.S. markets were sluggish throughout the first half of Tuesday’s action as the major indexes danced on both side of the ledger and within tight ranges. Much of the nervousness comes ahead of the Fed’s decision on interest rates Wednesday afternoon with Wall Street in a wait-and-see-mode heading into the event.

Second half weakness ensued following news the U.S. and China's phase one trade deal may not be signed at the APEC meeting in November as more time may be needed. The report added if the deal is not signed it is not a signal that talks have fallen apart, but simply that more time is required.

The mostly lower close held near-term support and resistance levels although volatility was slightly up for the 2nd-straight session. The VIX index continues to give excellent market clues and should be monitored closely during and after the Fed minutes are released.

The Nasdaq had it 4-session winning streak snapped after falling 0.6% while trading to an intraday low of 8,275. Near-term and upper support at 8,300-8,250 was breached and failed to hold with a close below the latter reopening risk towards 8,200-8,150.

The S&P 500 slipped 0.1% to end a 4-session winning streak, as well, after tapping a fresh all-time high of 3,047 shortly after the opening bell. New and lower resistance at 3,050-3,075 was challenged for the 2nd-straight session with upside potential towards 3,100-3,125 on a close above the latter.

The Dow dipped 0.1% despite trading to a morning high of 27,165 while holding the 27,000 level for the 2nd-straight session. Lower resistance at 27,200-27,400 was challenged but also held for the 2nd-straight session with a close above the latter and the all-time high at 27,398 getting 27,600-27,800 in focus.

The Russell 2000 was higher by 0.3% following the midday run 1,581. Lower resistance at 1,585-1,600 was challenged but held with a close above the latter and the late July high at 1,599 being an ongoing bullish signal.

Healthcare and Materials were the strongest sectors after rising 1.4% and 0.6%, respectively, while Energy advanced 0.4%. Communications Services and Technology paced sector laggards with losses of 0.9% while Consumer Discretionary was lower by 0.6%.

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    A Single Stock or ETF!

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ANALYST UPGRADES/DOWNGRADES

Amkor Technology (AMKR) upgraded to Outperform from Neutral at Credit Suisse
Owens Corning (OC) upgraded to Buy from Hold at Argus, Texas Roadhouse (TXRH) upgraded to Outperform from Market Perform at Raymond James

Cooper Tire (CTB) and Goodyear Tire (GT) downgraded to Neutral from Buy at Northcoast, GrubHub (GRUB) double downgraded to Underperform from Buy at BofA/Merrill
Tesla (TSLA) downgraded to Sell from Neutral at Roth Capital

WEDNESDAY'S EARNINGS ANNOUNCEMENTS  
Before the open: Anixter International (AXE), Brinker International (EAT),
CME Group (CME), Crocs (CROX), Dine Brands Global (DIN), Garmin (GRMN), General Electric (GE), iRadimed (IRMD), L3Harris Technologies (LHX),
Littelfuse (LFUS), Molson Coors Brewing (TAP), Oshkosh (OSK), Royal Caribbean Cruises (RCL), Sony (SNE), Tupperware (TUP), Wingstop (WING), Yum Brands (YUM)
     
After the close:  3D Systems (DDD), Apple (AAPL), Cardtronics (CATM), Cirrus Logic (CRUS), Ducommun (DCO), Equinix (EQIX), Etsy (ETSY), Facebook (FB), Hub Group (HUBG), LendingTree (TREE), Lyft (LYFT), Mellanox Technologies (MLNX), MGM Resorts International (MGM), NuVasive (NUVA), Quidel (QDEL), Rogers (ROG), SkyWest (SKYW), Starbucks (SBUX), Timken (TKR), Trimble Navigation (TRMB), Twilio (TWLO), Viavi Solutions (VIAV), Western Digital (WDC), Zynga (ZNGA)

WEDNESDAY'S ECONOMIC NEWS
MBA Mortgage Applications - 7:00am
ADP Employment Report - 8:15am
GDP - 8:30am
State Street Investor Confidence - 10:00am
Survey of Business Uncertainty - 11:00am
FOMC Minutes - 2:00pm

METALS / OIL
Gold closed at $1,490.70 an ounce, down $5.10
Silver settled at $17.83 an ounce,  down $0.05
Copper finished at $2.69 pound, up $0.01
Crude Oil  was at $55.54 a barrel, down $0.28
Bitcoin Investment Trust (GBTC) ended at $10.99 down $0.27


I hope this helps you prepare for the trading day. Make it a great one!


   Todd Mitchell


Not sure the best way to get started?

Follow these 3 simple steps ...

Step #1: Get These FREE Reports & Videos

Options INCOME  Profits   8 Video  Series    Habits that Kill Traders...



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Step #3: Connect with The Community
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The post Markets Tentative Ahead of Fed’s Decision on Interest Rates appeared first on Trading Concepts, Inc..

The S&P 500 stock index hit a new historical high yesterday. The driving factor: large tech! Akane Otani writes, "Stocks are broadly higher Monday, but it is a handful of big technology shares that have led the S&P 500 to its latest record."

It appears as if there has been a major change in what propels the stock market.

For much of the past ten years, it has been the Federal Reserve that has underwritten the rise in the stock market.

And, because of this, the general market moved, not one particular sector or another.

The consequences of this "underwriting" were substantial as passive investment vehicles came to be very popular versus those funds that were more "value" orientated. Passive vehicles picked up the general rise in the whole market, reflecting the fundamental role that was being played by the Fed.

The economy grew, not as rapidly as in the past, but it grew steadily, supporting the general rise in the stock market. The annual compound rate of growth in the US economy through the first ten years of the current economic expansion was 2.2 percent.

Inflation also remained low, remaining below the policy target of the Federal Reserve System of 2.0 percent.

All-in-all, it was a good time for stocks and the economy as the unemployment rate dropped to a fifty-year low.

But, times have changed.

From late 2018, the Federal Reserve has been going through a transition. In December 2018, the Federal Reserve raised its policy rate of interest for the ninth time since it started raising the rate in December 2015.

Talk following this increase, with the upper limit of the policy range going to 2.50 percent, was directed more and more toward reasons for Fed officials to lower the policy rate.

In late July 2019, Fed officials did just that - they lowered the policy rate of interest.

In the middle of September 2019, the rate was lowered once more.

And, the debate now is about a further lowering.

The Federal Reserve has shifted gears since late 2018, at least significantly enough so that the "whole" stock market seems less responsive to the Federal Reserve position than it did earlier.

The Federal Reserve, under Fed-chair Ben Bernanke, set out explicitly to support a rising stock market during the early years of the economic recovery, stating that a rising stock market would create a "wealth" effect that would support rising consumer spending and rising consumer spending would produce rising economic growth bringing to an end the Great Recession.

And, the Fed continued this policy through the end of Mr. Bernanke's tenure at the Fed and also through that of his successor Janet Yellen.

The Federal Reserve got exactly what it was aiming for - a stock market that continually hit new historic highs; consumer spending that supported the economic expansion; and an economic recovery that lasted, at least, a historic length.

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Now, the Fed officials continue to argue that they will, going forward, continue to err on the side of monetary ease so as to prevent a market collapse and economic disruption, but, clearly the tone of the Federal Reserve has changed - and so seemingly has the economic environment.

Market participants are not as confident in what this Fed, under the leadership of Jerome Powell, will do, and don't really understand about how US trade policies will be implemented by the Trump administration. Overall, there seems to be a great deal of uncertainty in the air.

The US economy is weak. The world economy is weak. There are disruptive things happening all over the world.

Yet, the S&P 500, which has been flirting with a new high for a couple of weeks now, climbs to a new record.

What is going on here? Is the "new" Modern Corporation emerging as the leader that will get us through this tenuous time?

The new "industrial world" of the Modern Corporation is being built upon intellectual capital and not on physical capital. Corporations are reaching a scale never before approached. And, yet they do this at zero- or close-to-zero marginal cost.

Things are not like they once were. Disequilibrium seems to be all around us. This is the time to ask questions. This is the time to check our assumptions. Maybe, this is a time to come up with some new answers.

Maybe the stock market is bifurcating into two parts, one dominated by the "new" Modern Corporation, and the other consisting of those organizations that have not, or, cannot, transition into the new corporate form built upon intellectual capital.

The "new" Modern Corporation must focus on the longer-run and cannot be dominated by short-run decision making. The "new" Modern Corporation must always be innovating, bringing on the next new thing at a regular interval. The "new" Modern Corporation can achieve scales and produce cash flows that bring out the call for greater regulation or even to be broken up.

The "legacy" corporations are struggling, at best, to stay in the game.

And, this argument doesn't even start to get into the questions about how the "new" Modern Corporation is altering how the economy is performing.

The S&P 500 hit a new historic high on Monday, but there is something different about this new record. And, maybe this "something different" needs to be addressed by investors because it could be an indication that new forces are in play and that the investment strategies of the past year - or the past several years - may need to be modified.

There is a lot going on that will require a lot of assessment. Stay tuned!

Source: https://seekingalpha.com/article/4300066-s-and-p-500-hits-new-high-sign-shift-market

Have a genuinely great day and I hope today’s trading article helps you.

The post S&P 500 Hits New High: Sign Of A Shift In The Market appeared first on Trading Concepts, Inc..

Here are the most important things to know about Wednesday before you hit the door.

1. Fed likely to cut rates again

The Federal Reserve is widely expected to deliver a third straight interest-rate cut on Wednesday. Nearly 80% of the fund managers, economists and strategists surveyed by CNBC’s Steve Liesman expect a quarter point rate reduction this week. However, 63% believe the Fed will pause cutting rates for the remainder of the year. The respondents believe the next cut will come in February, on average.

All eyes will be on chairman Jerome Powell’s signal on where the Fed stands in the easing cycle. The Federal Open Market Committee announcement is scheduled for 2:00 p.m. ET, followed by a press conference with Powell at 2:30 p.m. ET.

Wall Street’s top economist Ed Hyman said the anticipated cut will be the market’s “magic sauce,” giving the economy a needed jolt.

2. GDP to slow?

The central bank’s rate decision will come hours after the release of U.S. GDP data which is expected to show a further slowdown in the third quarter. Economists surveyed by Dow Jones are estimating gross domestic product increased at a 1.6% annualized pace in the July to September period, down from a 2% expansion in the second quarter.

Consumer spending, the biggest part of the economy, has been the driving force of the longest economic expansion in U.S. history. However, the recent weakness in retail sales, which fell for the first time in seven months in September, could be a sign that the resilience of the consumer is waning.

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3. Big earnings: Apple, Facebook, Starbucks

The earnings season will hit the halfway mark on Wednesday with a slew of quarterly results from high-profile companies including Apple, Facebook and Starbucks.

Apple will disclose its first major hint at how well the iPhone 11 is selling with Wednesday’s earnings report including ten days of the sales. Wall Street analysts expect Apple to report $62.9 billion in revenue and $2.84 in earnings per share, according to Refinitiv.

Ride-sharing company Lyft, Yum Brands, chipmaker AMD, Etsy and Volkswagen also report earnings on Wednesday. So far, 78% of the S&P 500 companies that have reported beat analyst expectations, according to FactSet.

Major events (all times ET):
8:15 a.m. ADP Jobs

8:30 a.m. Real GDP (first reading)

8:30 a.m. GDP Prices (first reading)

Major earnings:
General Electric (before the bell)
Yum Brands (before the bell)
GlaxoSmithKline (before the bell)
Simon Property Group (before the bell)
Volkswagen (before the bell)
Apple (after the bell)
Facebook (after the bell)
Starbucks (after the bell)
Lyft (after the bell)
AMD (after the bell)
Etsy (after the bell)
Twilio (after the bell)

Source: https://www.cnbc.com/2019/10/29/stock-market-outlook-for-wednesday-fed-rate-cut-gdp-apple-earnings.html

I hope this information is helpful, have a great day!

The post Fed set to cut rates, GDP report, Apple earnings: 3 things to watch in Wednesday’s markets appeared first on Trading Concepts, Inc..

U.S. stocks finished higher Monday, with the S&P 500 closing at a record, as investors waded into another busy week of earnings and a Federal Reserve policy meeting that’s expected to deliver another cut to interest rates.

What did the major indexes do?

The S&P 500 index rose 16.87 points, or 0.6%, to end at 3,039.42, closing above its previous record of 3,027.98, set on July 26. The index also set a record intraday high of 3,044.08.

The Dow Jones Industrial Average rose 132.66 points, or 0.5%, to finish at 27,090.72 and the Nasdaq Composite Index ended the session up 82.87 points, or 1%, at 8,325.99.

The Dow closed about 1% below its record close, set on July 15. The Nasdaq briefly traded above its record close of 8,330.21, set July 26, but ended the day just 4.22 points shy.

What drove the market?

Investors were focused on corporate earnings reports, with 162 S&P 500 companies due to release quarterly financial results this week.

The market was pleased with earnings from one of the bigger names in the index, AT&T Inc. shares of which rose 4.3% Monday after the media-and-communications giant topped third-quarter profit expectations and revealed a plan to grow earnings-per-share by at least 33% by 2020.

Expectations around U.S.-China trade talks remain a positive force for the market, analysts said. The U.S. Trade Representative’s office on Friday released a statement that said U.S. Trade Rep. Robert Lighthizer and Treasury Secretary Steven Mnuchin spoke with Chinese Vice Premier Liu He on Friday and were close to completing some sections of an agreement with Chinese negotiators.

“We have a convergence of a bunch of positives that are sending the market higher,” Alec Young, managing director of global markets research at FTSE Russell told MarketWatch, including better-than-expected earnings, progress on U.S.-China trade talks, and hopes that Britain will leave the European Union in an orderly fashion.

Through Friday, 40% of companies in the S&P 500 had reported third-quarter results, with the percentage topping estimates — 80% — running above the five-year average, according to FactSet. However, in aggregate companies reported earnings 3.8% above estimates, which is below the five-year average.

“Binary earning surprises continue to favor the bulls so far this season,” said Jeff deGraaf, chairman of Renaissance Macro Research, in a note. “Maybe the bar was lowered, thus spotting the earning season a few field goals, but better or worse is more important in this business than good or bad.”

Meanwhile, with the market on the verge of a new high, the broad S&P 1500 index doesn’t look dangerously overbought, he said.

The Federal Reserve is widely expected to deliver another quarter-point cut to its benchmark interest rate when policy makers conclude a two-day meeting on Wednesday.

Investors also continue to watch developments around Britain’s efforts to complete a deal dictating the terms of its exit from the European Union. The EU on Monday agreed to delay Brexit until Jan. 31 — OK’ing the postponement just three days ahead of the previously scheduled Oct. 31 departure date.

Meanwhile, U.K. lawmakers were expected to vote later Monday on whether to hold an early election in an effort to break parliamentary deadlock over Brexit. U.K. Prime Minister Boris Johnson is seeking a Dec. 12 election, but faces an uphill battle in Parliament.

In economic data, the U.S. trade deficit in September came in at $70.4 billion, below the $73.7 billion expected by economists polled by MarketWatch, and below the August level of $72.8 billion.

The Chicago Fed National Activity Index fell to -0.45 in September from 0.15 In August, suggesting below-trend economic growth in the U.S.

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What companies were in focus?

Shares of Tiffany & Co. rallied 33.3%, after the luxury jeweler confirmed reports that it had received an unsolicited acquisition proposal from LVMH Moët Hennessy Louis Vuitton SE for $120 per share in cash, a roughly 32% premium to Friday’s closing price.

Restaurant Brands International Inc.​ the operator of the Burger King, Tim Hortons and Popeye’s fast-food chains, reported earnings that matched the consensus forecast, while revenue came in just below. The company’s stock fell 3.8%.

Spotify Technology SA shares were up 16.2% after the music-streaming service reported an unexpected profit in the third quarter, while surpassing analyst estimates for monthly active users.

Athene Holding Ltd. announced Monday that it has reached an agreement with Apollo Global Management Inc. that would give Apollo an 18% stake in a deal valued at about $1.55 billion, or $46.20 a share — a 10% premium over Friday’s closing price. Shares in the retirement services company rose 5.5%.

Walgreens Boots Alliance Inc. shares closed 0.7% higher, after the retailer reported fourth-quarter profits and revenues that beat Wall Street expectations.

Beyond Meat’s stock jumped 4.6% before it reported quarterly results after the bell on Monday.

Virgin Galactic Holdings Inc. fell 0.3% on the human spaceflight company’s trading debut.

How did other markets trade?

The yield on the 10-year U.S. Treasury note rose 4.9 basis points to 1.848%.

In commodities markets, the price of West Texas Intermediate crude oil for December delivery lost 85 cents, or 1.5%, to settle at $55.81 a barrel on the New York Mercantile Exchange, and the price of an ounce of gold fell $9.50, or 0.6%, to settle at $1,495.80 an ounce. The U.S. dollar, meanwhile, ticked 0.1% lower relative to a basket of its major trading partners.

In Asia overnight, stocks closed higher, with the China CSI 300 adding 0.8%, Hong Kong’s Hang Seng Index rising 0.8% and Japan’s Nikkei 225 advancing 0.3%. In Europe, stocks were mostly higher, with the Stoxx Europe closing up 0.3%.

Source: https://www.marketwatch.com/story/stock-index-futures-point-slightly-higher-as-sp-500-nears-record-territory-2019-10-28?mod=home-page

I hope you found this article helpful in our trading strategy.

The post S&P 500 closes at record as corporate earnings beat expectations appeared first on Trading Concepts, Inc..

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