Wkly Round-Up 4/12/2019 Jack & Jill Market

Hey Folks, first as a reminder, this coming week will be a holiday shortened week for most major Stock Index’s closed for Good Friday. Enjoy the long weekend

This week’s sound bites:

• The major US Indexes are all a chip shot away from reaching all-time highs yet trading Volume is near lows normally seen around Year End Holidays! A good deal of “what next” indecision seems to be in the air. However, we did get a good start to Q1 Earnings with a few key bank stocks (JPM, WFC and PNC) all beating and seeing their shares move higher into the weekend. But the bar has been set very low with the markets expecting Year over Year Earnings declines of over 3.5%. The markets seem to be currently pricing in a reacceleration of earnings in the second half of this year while also remaining confident interest rates will stay low while inflation will stay subdued.
• This past week we saw the Minutes of the FEDs March meeting indicate interest rates are going nowhere for the near term and inflation is still rather tame. We have seen the Fed Fund Futures reduce the odds of a rate cut from 50% to almost zero in only a week’s time. This shows the uncertainty the current markets are facing.
• We are still seeing the Bond markets and the Stock markets are each living in a different universe, with Bond yields very much subdued as the Equity markets are pushing to all-time highs. And just this past week the IMF (international Monetary Fund) lowered its global growth estimates down to 3.3% from 3.5% over the course of the past 3 months.
• What has declined a great deal in as we move into Q1 Earnings season is market volatility as measured by the CBOE VIX. It closed this Friday at 12.01 which shows either a sign of market complacency or confidence, only time will tell. However, we are currently seeing a near record of shorting activity on VIX betting that Volatility will stay down for a longer period of time. And as a reminder, it was a large volume of short bets in Volatility that caused a lot of issues in the February 2018 market crash.
Now enjoy this week’s Weekly Round-Up

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