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  • Finance 0

    Le Pen Is The Last Thing Standing Between Equity Bulls And The Promised Land

    The Trump-flation narrative has driven U.S. stocks to valuations last seen in the tech bubble. On a relative value basis, Europe is a bit more appealing. As a result, hedge funds have been increasing their equity exposure to Europe since early 2017. The Fed is also in the middle of a rate hiking cycle while the ECB remains 40 basis points south of zero. The easy money is overseas. Plus there’s a record gap between U.S. and European EPS. U.S. earnings have always been larger than their European counterparts, but never by 53%…   Given those facts, it’s easy to see why money managers are tilting their portfolios away from U.S. equities an...
    On April 26, 2017 / By
  • Finance 0

    E Market Briefing For Wednesday, April 26

    Sequential breakaway moves by the S&P 500 must be respected, while they are also (on-top of high valuation levels) a blow-off completion move capable of occurring. With the market advancing above the ‘pivot’ level we’d outlined there’s no disappointment, there’s just a sober view of what this is, and what this is not. What this is clearly, is a higher high for the NASDAQ, and a comparable or catch-up kind of move by the S&P and the Dow Industrial Average. Now this becomes technically overbought once again, even as it can move higher ‘if’ things continue to fall inline. That was the near-term p...
    On April 26, 2017 / By
  • Finance 0

    Global Market Cap Hits $50 Trillion For The First Time Ever As All Eyes Turn To Trump Tax Plan

    After two days of back to back triple digit gains in the Dow for the first time since the election, overnight the torrid rally has faded, with European shares and U.S. stock futures little changed ahead of Trump’s big unveil of his much anticipated tax cut plan as investors seek new impetus for a flagging relief rally. And, if as some traders expect, the rally is likely to be reignited no matter what Trump announces today (although a less hyperbolic plan may in fact be more favorable for risk, as it makes Trump’s plan more likely instead of being shot down by Congress). Despite the tapering of euphoria, world stocks hit another al...
    On April 26, 2017 / By
  • Finance 0

    If You Own Just One Pharma Stock, Make It This

    As I’ve said before, buying a drugmaker stock with true billion-dollar “blockbuster” potential is like grabbing a license to print money. Of course, it’s always at least possible to grab these shares on their way up, but that’s a little like fixing the barn door after the horses have bolted. For the biggest possible pharma profits, investors have to look ahead into the firm’s “pipeline,” its arsenal of yet-to-be-released drugs that’s critical to keeping a drug company competitive in the long term. Today, I’ve got the perfect “Buy” recommendation for a company that’s...
    On April 26, 2017 / By
  • Finance 0

    Dollar Stabilizes Ahead Of Trump And ECB

    The US dollar was marked down in response to the French election and saw some follow through selling yesterday, but the momentum had slowed, and now it is stalled. The greenback is posting upticks against nearly all the major currencies.   There is a good reason to be cautious. We have mentioned it before, but think it is important that speculator in the futures market had a record gross long euro position, according to Bloomberg data. The dollar overhang that may have helped cap it at the start of the year is no longer the case.   Many observers have bought the line from the hawks that the ECB can change its stance shortly. Recall,...
    On April 26, 2017 / By
  • Finance 0

    Above The 40 – The S&P 500 Follows Through And Scratches Overbought Levels

    AT40 = 67.2% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 65.1% of stocks are trading above their respective 200DMAsVIX = 10.8 (volatility index)Short-term Trading Call: bullish CommentaryThe French Fly continued apace as financial markets continued to celebrate. In The French Fly, I failed to post a chart of the iShares MSCI France (EWQ).    The French Fly caused an impressive breakout to a near 3-year high for the iShares MSCI France.   The monthly chart of EWQ shows the tremendous upside potential for EWQ in a recovery scenario. The major relief from the first round of the French Presidential e...
    On April 26, 2017 / By
  • Finance 0

    Stock Markets At All Time Highs, EURJPY 4.1% Up This Week

    USDJPY continues its wild rise touching 111.40 highs so far. Notably, the USDJPY was at 109 on Friday. Nevertheless, Reduced concerns over the French Presidential elections in combination with strong US data and optimism regarding Trump’s expected tax reform announcement today, kept the pair in high demand, as well as stock markets.  Overnight positive earnings from large multinational companies lifted US equities Nasdaq hit a record high yesterday, surpassing 6000 points, while the Dow and S&P 500 also closed 1.12% and 0.61% respectively. EURUSD also rose to 6 month highs of 1.0950 as a sign of relief that Le Pen will probably not win...
    On April 26, 2017 / By
  • Finance 0

    London Property Crashed 40% Thanks To Tax Increase

    The London housing market has crashed to its lowest level now since 2013. We reported in  November 2015 with the turn in the ECM on 2015.75 that the London property market peaked. Landlords are joining together to challenge the Conservative’s (i.e. Tory’s) tax hike by filing a suit in the high court against their tax increase on “buy-to-let” investment properties.  In July 2015, we warned that the Conservatives were going after the non-domiciled residents in London and that would stop the real estate boom. Where I use to live back in 1985 The figures are now out and they show that the number of homes bought over the last year...
    On April 26, 2017 / By
  • Finance 0

    When Restrictions On House-Building Meet Growing Demand: Interview With Joseph Gyorko

    For a few years now, Joseph Gyourko has been doing research and writing essays with a focus on housing supply, and in particular, how a collision between local restrictions that hinder home-building combined with growing demand in those localities lead to differences in prices. In an interview with Hites Amir, Gyourko lays out these views in the April 2017 issue of the Global Housing Watch Newsletter.  (The newsletter is produced by Amir, who works fo the International Monetary Fund, but it is not an official IMF document). “In forthcoming work, Ed Glaeser and I conclude that most housing markets in the interior of the country functio...
    On April 26, 2017 / By
  • Finance 0

    USD/JPY Bullish Breakout Above Bull Flag Pattern At 110

    USD/JPY 4 hour Yesterday the USD/JPY broke as expected above the 110 resistance (dotted red) of the bull flag chart pattern. Price has continued with its bullish extension in wave 3 (brown) and has now arrived at the 261.8% Fibonacci target which could create a potential retracement. 1 hour The USD/JPY breakout above resistance (dotted red) has reached a main Fibonacci target and is therefore at a bounce or break spot. EUR/USD 4 hour The EUR/USD broke above the resistance trend line (dotted red) and has hit the first target at 1.0950. The second target is the psychological round level of 1.10. A break above that could see the EUR/USD extend t...
    On April 26, 2017 / By