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S&P 500 Tumbles Back Into Correction, Gives Up Post-QE3 Gains
With the drop today, the S&P 500 is now down 10.5% from its May highs, re-entering the correction seen on Black Monday. This now leaves the key benchmark lower since QE3 ended and unchanged since May 2014.
Blame The Pope?
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VW is a mark 6 tigers 88 mill aimed at dousche bank
Teh we still has some monies in a play account to short with. Hopefully can still get out in time before teh roof comes down, plan on not getting too greedy...
Its going to have to fall further than that to scare the politicians into letting the fed do what they really want to try.
I’m noticing a pattern, First Haldane, then Englander, and now Albert Edwards calling for radical monetary policy even by todays standards. Edwards is calling for negative rates of -3.5% or more alongside much more QE. When the calls move from Zerohedge, who has made these calls early and often, to the mainstream the end is nigh.
No more room for joking about it. This is 2008/2009 all over again.
No, this time will be worse, since the props holding up the facade are much bigger, but still only made out of paper.....
So the Pope is freaking, and throwing out, the Financiers and Money Changers ... what timing.
Don't be ridiculous, the Vatican is a big financial player. The pope *IS* one of the money changers.
The us threatened the Vatican bank with the swift system just before this guy showed up,
2015/2016 will dwarf 2008 in the end. This will be the pop of USD and UST. Be ready. Looks like the USG plans to take a few industry giants down with it too.
If you prepped hats off to you.
All currencies are going to hell in a bucket.....
Come on Gartman, we're waiting on your all-in buy call!
Thats the ultimate All-Clear sign.
THE GARTDICATOR
you can make 7000 dollars at home only using the internet !
What happened to American exceptionalism? Or, in other words, infinite, illegal buying of stocks by the Fed.
UVXY +16.72%
check written in common core math problem goes viralhttp://www.foxnews.com/us/2015/09/23/ohio-dad-posts-check-on-facebook-po...
Common Core is a virus.
Eliminate the FDoE - it's a start.
I had no ideal about that - utterly insane. Im like 80% sure I want to home school my kids at this point.
The real drainage could occur if folks find out Cook was BSing about sino gold and the ithing margins are really struggling like Samsung, Nokia and HTC. AAPL up 10% for last 12 months and SPX -4%. Never mind AAPL up 1380% over 10 years.
Nothing to worry about. Ctrl-P and PPT are on it.
Some 3X shorts (EDZ, SRTY, SPXS) are up 10% to 20% in the last 5 days.
HoOoOoO yeah.
finally , FINALLY my shorting record is back on track
Janet ! hurry up ! this looks like price discovery ! damnitdamnitdamnitdamnit !
BLOOMBERG headline (no, you couldn't make it up):
U.S. Stocks Decline as Investors Crave More Guidance From Fed
So are we getting primed up for the grand mal of all helicopter drops or the grand finale of QE?
Amazing there are no QE4 leaks or market breaks on a day like today.
I'm not sure this decline is on Janet's "approved" list, if we close a few more points down below Dow 16,000 we break the Bollinger Band. Again, as in August. Just this CAT hit ... ouchy.
According to Bank of America Merrill Lynch:
http://is.gd/5vle0j
Strategy Snippet
You can have too much of a good thing
The Fed is helping so much it hurts
We have noted that each incremental instance of monetary stimulus has been met with diminishing returns for risk assets. We think further easing, or a lack of tightening, in the U.S. is a negative for stocks. The expectation for Thursday’s FOMC policy decision was a rate hike and dovish commentary, or no hike and hawkish commentary. Instead, the Fed left rates unchanged and delivered a dovish message. In response, the S&P 500 sold off into the close and was down the next day. As we have noted recently, the biggest risk to equities could be another round of QE—suggesting that $4.5tn was not enough to prop up the U.S. economy. Also, the read across for global risk assets could be that significant liquidity provided by central banks may not always be sufficient to drive markets higher.
Tactical delay or real economic deterioration?
Our base case is that the Fed’s lack of action is a tactical delay, and therefore does not impact our outlook. We are maintaining our recently lowered S&P 500 year-end target of 2100. We note that our technical team sees risks to the bull market, and our global quant team’s Global Wave has been declining for the last eight months. Our economists’ real- time indicator of global growth, the GLOBALcycle, softened in August (led by EMs), and we will be closely watching for signs of stabilization or further deterioration.
The Fed on hold = more of the same
The story for the last five years looks set to continue for at least the next few months. With easy monetary policy and a scarcity of growth and value, we would expect to see positive momentum in Growth and Dividend Yield stocks continue. But, given our economists’ expectations for a pick-up in global growth over the next several quarters, buying cheap, unloved cyclicals could start to play out. This would also be true for Energy, which is the ultimate pain trade. Energy has record low valuations, ownership and investor sentiment, and our commodity strategists forecast a year-end rally in oil prices.
Multinationals: intersection of quality & weak dollar beneficiaries
Buying multinationals looks increasingly attractive. These high quality stocks are beaten- down, inexpensive and under-owned by active funds. The companies have produced upside earnings surprises, and the stocks have been outperforming since mid-August, despite the volatility associated with concerns about global growth. The performance of foreign- exposed stocks is now more correlated to moves in the US dollar than at any point in nearly a decade. Dollar strength has been a source of pain for multinationals so far this year, but this could reverse if a dovish Fed exerts more downward pressure on the dollar.
China risks - avoid Materials
With the recent slowdown in China, we are mindful of the risk of a recession. The area most exposed to China is the Materials sector. This sector’s performance is most highly correlated with China’s stock market, as well as with monetary conditions in the region. Metals and Mining looks particularly unattractive given overcapacity in China, and screens as a Value Trap in our work. Health Care is the least correlated with China.
Go Pope go!
According to GMP Securities:
This week, it is still all about the Fed…
81% chance FOMC comments will be interpreted bearishly
Even after last week’s FOMC rate decision, it is still all about the Fed. Every time an FOMC member speaks out, markets move. What investors may not be fully appreciating is that 13 out of 17 FOMC members believe that the Fed will raise rates in 2015. That is a considerably higher conviction level than is generally held by investors. We know one of the four doves is Minneapolis Fed President Kocherlakota, whose views are well outside the mainstream. We can’t be as sure about the rest. But every time a (non-Kocherlakota) FOMC member speaks, there is an 81% (13/16) chance that their views are likely to be more bearish than the market consensus. Therefore, over the near term investors should treat FOMC governor speeches and interviews as potentially bearish events.
If markets rally on Yellen comments, sell into strength
Fed Chair Janet Yellen will be speaking today (without taking questions) on inflation and monetary policy. We doubt she will make a case for or against a December rate hike so soon after the last FOMC meeting. We expect her to paint a balanced picture, befitting her role as Fed Chair and reflecting her desire to keep the Fed’s options open. In comparison to most other FOMC members, her balanced commentary may appear dovish and allow markets to rally. On a trading basis, we would be inclined to sell into such a rally. As we argue above, we expect further FOMC member chatter to remain a focus and expect it to tend to push markets lower.
We see downside risk to S&P 500 as min 1867 and max 1700
We continue to see fear of Fed tightening as a storm cloud hanging over the equity market that will likely remain in place until the Fed actually raises rates (December in our view). Fed fears, negative earnings revisions, down yoy earnings, and valuation risk could push markets lower in the coming weeks. We see downside risk as somewhere between the August lows (S&P500 1867) and a 20% correction (S&P500 1700).
Expect better equity performance in 2016
Looking ahead to 2016 the outlook is more encouraging. Once the Fed starts raising rates we expect to have more clarity on the pace of future rate hikes, which should be more gradual than many expect. In addition, earnings should start to grow again by 2016 as the negative yoy impact from the rising USD and falling oil prices should fade. An attractive buying opportunity should present itself between now and year end.
One has to read (and marvel) at that last paragraph, with header regarding '2016'...
It is difficult to determine whether some people (or 'Securities firms'), never learn or simply refuse to see. Nearly the exact same words/sentiments were proffered late last year, right into the beginning of this year. Amazing. It just serves to remind that because a system has been in place for so long, it is ingrained in the mind of many that it always will be...
Umm, the a-b-c counter-trend second wave was clearly delineated as was the start of this 3rd primary wave down, which will be a dandy.
Open that tool box Janet...
http://www.marketwatch.com/story/legendary-investor-crispin-odey-goes-to...
Legendary investor Crispin Odey goes to cash as stocks are ‘overextended’
By Brett Arends
Published: Sept 24, 2015 11:51 a.m. ET
The U.K. hedge fund manager says ‘we are now due’ a recession
One of Europe’s most brilliant investment managers is warning of a new global financial crisis on the horizon and has moved a huge chunk of his portfolio into cash.
Crispin Odey, who founded London-based Odey Asset Management in 1991, says the turmoil that began last month has only just begun, and that equity markets could fall much further.
“Our overriding conviction is that we are nearer the beginning of this process than the end,” the hedge fund manager warns clients in his latest report. Stock market valuations worldwide “are so overextended that they will need to fall 30%-40%” before they offer a compelling bargain, he argues.
Astonishingly, Odey now holds 29% of his retail investment fund, Odey Opus, in cash — even though the fund is typically oriented toward growth. The firms manages about $11.7 billion in assets.
It’s easy to take prognostications with a pinch of salt. There’s always someone somewhere predicting doom. The British seem to specialize in it. I’ve been lunching and dining with a variety of accomplished money managers in London in the past few days, and each one has been even more terrifying than the last.
But Odey is no ordinary money manager. He is a living legend in London financial circles, and is usually bullish as well. His Opus fund is up 270% since it was launched in 2001, three times as much as its benchmark.
Odey argues that China’s devaluation augurs an era of financial crisis across emerging markets, including currency wars, tariffs and the formation of trading blocs. China’s ailing economy, he says, will be the new U.S. housing crash. Meanwhile, the world is struggling under debt burdens that have not been eased by years of so-called monetary easing.
There is a recession every decade and “we are now due ours.”
Yikes!
If Odey’s right, then I was way too early when I began buying stocks last month. (It wouldn’t be the first time.) But I don’t want to sit almost entirely in cash either. Buy often, buy early?
Pope causing mayhem on wall street, Allah doing crazy things in Mecca. Is theer a God that can help???? Anywhere??
The 'real one' is quite content to let this play out on its own I would imagine...
you see any Frost Giants? Hail Odin
if it is all manipulation..stop calling it a correction
Any sign of the Bullard?