Small caps are back in favor again this week with two days in a row of gains. Bullish sentiment surrounding the Trump trade is back in a big way. Investors have become very enthusiastic around small caps and given the composition of the Russell it’s no wonder the R2K has pushed higher by such a large margin. Financials make up over 20% of the index. The regional banks have done very well in the weeks following the election as rates on the long end of the curve have gone up. In addition to that, investors believe investing in American businesses will boost the domestic economy and provide more fuel for the fire of the small banks. Companies ...
The British Pound edged lower overnight as UK Prime Minister Theresa May reversed a preference for staying mum on the administration’s Brexit strategy, asking the House of Commons to vote on her plan to trigger Article 50 of the Lisbon Treaty and officially start departure negotiations by the end of March. She also committed to revealing the official road-map for the UK/EU divorce prior to that deadline. Ms. May’s move puts MPs on the spot to back the outcome of July’s referendum or appear to ignore the electorate, which investors may have interpreted as upstaging moderates and increasing the risk of a “hard” exit (implying a lo...
The Brexit “Leave” decision is tying the hands of the British government and Prime Minister Theresa May. The worry is that the Brexit decision will induce many corporations to move their headquarters out of Britain. Shortly after the June vote to leave the European Union, former PM David Cameron floated the idea of cutting corporate tax to 15% from 20%, as a way to help ease the worry in U.K. boardrooms The current U.K. Prime Minister Theresa May is also promising to sharply lower the corporate-tax rate to, in effect, counter the natural incentive for international investors to choose new head office locations. The low corporate tax scena...
EUR/GBP is moving higher, now out of a downward channel which suggests that a new rally is in progress that can take us back to the area of a former wave four where a new reversal can be seen later this week. Short-term structure is bullish, but it can be only a temporary bounce within much powerful bearish trend on larger degree charts. EUR/GBP, 1h...
WTI Crude Oil The WTI Crude Oil market fell during most of the session on Tuesday, but found enough support off of the previous uptrend line and more importantly the $50 level, we turned around to form a hammer. I think today will be crucial when it comes to the WTI Crude Oil market, as we get the Crude Oil Inventories number. Ultimately, we are expected to see a drop of 1.2 million barrels in inventory. If we see more, that shows a pickup in demand and that could be reason enough for us to continue going long. However, we see a number higher than that, the market will more than likely break down below the $50 level. On a daily close below th...
There is not a best scientific approach to investing that works 100% of the time, but there are some measurement techniques that are pretty darn close. One of these techniques was first introduced to me when I worked as a stock trader and was highly exposed to technical analysis. Our investment team had a meeting with one of the most revered economists from Oppenheimer Funds, who explained his scientific approach in using the 150-day moving average on stock charts to determine the optimal buy and sell positions of a stock. Carter Worth is one smart cookie: he is an American financial analyst and stock market strategist, and he is a seven-tim...
Today will probably continue in yesterday’s quiet mode ahead of the ECB meeting tomorrow. Notably, the markets are pricing in a rate hike in 2018 with an 80% probability. The USD gained yesterday against majors. Today’s main event is the Bank of Canada Rate Decision. Currencies: Although mostly stable, the dollar managed to stage a slight comeback yesterday. The EUR plunged to a 20-month low on Monday (1.0505) but quickly managed to post a 3 week high of 1.0797 on the same day as market participants concerns were eased in regards to the Italian PM resignation. Overnight, the AUDUSD dropped 0.5% after GDP data showed that the country...
The Indian share markets continue to trade flat with positive bias during the noon trading session ahead of the Reserve Bank’s policy review meet. Sectoral indices are trading on a mixed note with auto, PSU, oil & gas stocks leading the pack of gainers. Whereas, healthcare and information technology stocks heading the losers. The BSE Sensex is trading higher by 95 points while the NSE Nifty is trading higher by 33 points. The BSE Mid Cap index and BSE Small Cap index both are trading up by 0.3%. Gold prices, per 10 grams, are trading at Rs 27,870 levels. Silver price, per kilogram is trading at Rs 40,951 levels. C...
Asian shares edged higher on Wednesday as markets continued to recover from the jolt sent earlier this week when Italian Prime Minister Matteo Renzi announced his resignation. The MSCI’s broadest index hit two-month highs, showing a rise of 3.4 percent from its November low. Asian shares rose on the coattails of Tuesday’s gains in which Italian shares rose 4.2 percent to hit 5 ½ month highs French shares rose to eleven-month highs on Tuesday. Global currencies stayed fairly stable during Wednesday’s morning trading session, with the dollar standing at 114.11 against the yen and the euro finding some support against the dollar’s recen...
Yes, it’s true. Middle East net oil exports are less than they were 40 years ago. How could this be? Just yesterday, Zerohedge released a news story stating that OPEC oil production reached a new record high of 34.19 million barrels per day. To the typical working-class stiff, driving a huge four-wheel drive truck pulling a RV and a trailer behind it with three ATV’s on it, this sounds like great news. Unfortunately for the Middle East, this isn’t something to celebrate. Why? Well, let’s just say, there’s more to the story than record oil production. While the Middle East oil companies were busy working hard (spending money hand ov...