Friday Investment Talk: Emerging Markets, Barron’s Big Money Poll, Seasonality
Closer look at Emerging Markets after last years stellar returns. Barrons Big Money looks bullish from the outside only. SaaS is overvalued still.. Seasonality shifts towards small caps. Financial Vulnerability is a hot topic after COVID.
Seasonality: More Stimulus and New Highs
Seasonality has slightly moved forward this month. Will we see more weakness ahead, as this month’s gains are above average already with last week’s move from the US stimulus announcement?
Halloween Trading Strategy
Halloween typically offers investors a treat. A six day trading period starting next week is usually very bullish.
October: Worst Month in Election Years
October can invoke fear into investors as it is usually a weak month. However, October often marks the lows for the year. Stay diligent!
Scary September Seasonality
Portfolio managers returning to work after Labor Day tend to clean house. Since 1950, September is the worst performing month of the year. A bullish election-year does little to improve on September’s poor overall performance.
S&P 500 has declined 9 of the last twelve years on the first trading day. Options Expiration week (Triple Witching for September) is usually bullish, but beware after that!
August Seasonality: Best Month for Tech and Small Caps?
The month of August is usually one of the worst months of the year for US stocks. In years of a US presidential election (like 2020), August holds a special spot in the calendar for certain stocks.
July Seasonality: Mid Month Update
NASDAQ’s mid-year rally (described here in late June) came to an end on July 14. From mid-July, the second quarter is usually plagued with poor performance. Enthusiam and large amounts of cash on the sidelines could keep stock prices aflot. Hower, defensive positioning seems a more reasonable bet.
January Negative Returns: What does it mean for the rest of the year?
January finished January down 0.2%. But the does not necessarily meaan the rest of the year will be. We look at the historical record to see how other years performed when January did not do well. It turns out 2 of 3 indicators often are enough to propel the markets higher.
December Seasonal Outlook: Santa Claus Rally & Year End Highs
Novemeber is tracking the seasonal patterns very closely. We still expect a mild pullback early next week, but from then on we are likely to see post-Thanksgiving gains. Early December can be disappointing for bullish traders, but as Christmas approaches the bulls come back to the parade.
Seasonal Trade Strategy Update: New highs at a weak time
We noted previously that the market would likely work its way higher in the first few weeks of September. Now momentum appears to be fading short of previous all-time highs. With the Fed’s interest rate cut behind us, future price increases need support from alleviating trade issues and more interest rate cuts. Neither of those factors exist yet.