Where have all the dip-buyers gone?
After weeks like the train wreck that just passed, investors are supposed to come along and scoop up bargains, right? That’s been the norm for decades, after all. Alas, it’s not the norm any more, as you can see from this Wall Street Journal chart:
Indeed, the reliable “buy-the-dip” trend that made this market so dependable has left the building, with the S&P 500
, on average, failing to rebound following weekly declines this year for the first time since 2002, according to Morgan Stanley.
The start of the week certainly looks no different. Trade-war skittishness and uncertainty over the Fed’s direction aren’t helping. It’s got the look of another downbeat start.
The Onion, which says we’re in an “Everest/Mariana Trench pattern,” channeled the White House with its tweet on what we’re seeing:
— The Onion (@TheOnion) December 10, 2018
At any rate, the lack of those aforementioned dip hunters has caused Cantor Fitzgerald’s Peter Cecchini, in our call of the day, to shift his approach.
“Our disposition towards equities has moved from buy-the-dip to sell-the-rally,” Cecchini was quoted as saying in a Bloomberg piece. “If I’m not constructive on the credit markets, then I won’t be constructive on the equity markets.”
And no, he’s not constructive on credit. Cecchini, heralded as one of relatively bearish analysts in 2018, says decelerating U.S. growth and a frothy loan market will keep the credit market under stress as we head into next year.
And speaking of stress…
Futures on the Dow
are all showing no signs of a rebound. In fact, quite the contrary. At the same time, yields on the 10-year Treasury
are creeping up again.
, taking advantage of the jumpy climate, is catching a slight whiff of buying. Crude
is basically flat.
Check out Market Snapshot for more
from Sydney to Hong Kong
also felt the pressure and closed with widespread losses. Europe markets
aren’t faring any better in their kickoff to the week.
Cryptos, which have gotten beaten up lately, are providing a splash of green, with bitcoin
holding above the $3,500 level.
There was plenty of carnage in all corners of the market last week, but it was especially nasty for FANGMAN stocks — Facebook
, Google parent Alphabet
. All told, the group lost more than 10% for the week, according to Wolf Richter of the Wolf Street blog.
And as this chart shows, the group has shed 22.4% from its peak:
Richter reminds investors of the magnitude of the decline
“The FANGMAN stocks as a whole dipped into the red year-to-date on Friday,” he wrote. “From that perspective, this $1.034 trillion that disappeared since Aug. 31 isn’t anything to write home about — these stocks being down just a smidgen for the year, a harmless form of easy-come, easy-go. It’s not like it can’t get a whole lot worse.”
boss Elon Musk had a lot to say on “60 Minutes” on Sunday about his “unfair” critics, his “terrible” childhood, and his lack of respect for the SEC. “I’m just being me,” he said. “I mean, I was certainly under insane stress and crazy, crazy hours. But the system would have failed if I was truly erratic.”
A reported 136,000 protesters took to the streets across France again over the weekend, prompting French President Emmanuel Macron to potentially announce measures to ease the violence when he addresses the country on Monday. It has even forced a cut in the country’s growth forecast.
Fund managers controlling a combined $32 trillion are calling on the powers-that-be to accelerate steps to fight climate change, according to Reuters. A total of 415 investors from around the world signed the 2018 Global Investor Statement to Governments on Climate Change demanding urgent action. “The global shift to clean energy is underway, but much more needs to be done by governments to accelerate the low carbon transition and to improve the resilience of our economy, society and the financial system to climate risks,” the statement said.
Another wrinkle on the trade front? China summoned the U.S. ambassador to Beijing on Sunday to protects the arrest of Huawei’s chief financial officer, Meng Wanzhou, who was detained in Canada on Dec. 1 at the behest of the U.S. That news shook markets up pretty good last week. U.S. Trade Rep.Robert Lighthizer tried to keep that arrest separate from said Sunday that U.S.-China negotiations should not be impacted by the controversial arrest of a top executive from Chinese telecom giant Huawei.
“What these indictments and filings show is that the president was at the center of a massive fraud — several massive frauds against the American people” — Jerrold Nadler, incoming chair of the House judiciary committee, in a CNN interview.
10 billion euros ($11.4 billion) — That’s how much money small- and medium-sized business in France are expected to lose due to the riots across the country. The French retail federation told Reuters on Friday that retailers had already lost about 1 billion euros since the protests first began.
November CPI and retail sales are the headline economic numbers this week, but we won’t get those until Wednesday and Friday, respectively. As for Monday’s schedule, not a whole lot to get excited about, though the Job Openings and Labor Turnover Survey hits at 10:00 a.m. Eastern.
Conservative’s better start chatting with the city dwellers.
Did Minneapolis just pass the most important housing reform in America?
Boasting about the crazy hours you work is actually a sign of failure.
Those elite NYC buildings aren’t fetching prices like they used to.
The year in pictures, as presented by CNN. Here’s one of them:
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