|Day's range||3,108.03 - 3,128.91|
|52-week range||2,191.86 - 3,393.52|
In this week's episode of Influencers, Yahoo Finance Editor-in-Chief Andy Serwer speaks with Koch Disruptive Technologies President, Chase Koch, about his venture capital endeavor and what the company is doing to push Koch Industries into the future.
(Bloomberg) -- Stocks slumped in the U.S. and Europe as investors weighed concern the recent rally had gone too far with new stimulus measures and encouraging economic data.The S&P 500 Index headed for its first loss in five days, while the tech-heavy Nasdaq 100 briefly climbed to an intraday record after EBay Inc. raised its forecast for sales and earnings. Treasury yields rose as weekly jobless claims fell. The Stoxx 600 stayed lower even as the European Central Bank moved to add 600 billion euros to its pandemic purchase program, more than expected.After exceptional gains for equities in the past week took valuations to the highest since 2000 and pushed technical levels on the S&P 500 toward overbought levels, traders are searching for further tailwinds.“We had stocks make a miraculous recovery from their March 23 lows and so it makes sense that we’re unlikely to see the rally continue at the pace it has,” said Kristina Hooper, chief global market strategist at Invesco. “We’re probably going to see more of a plateauing, more of trading in a range until there’s a catalyst that moves them forward.”Earlier on the stimulus front, German Chancellor Angela Merkel’s coalition agreed on a sweeping 130 billion-euro ($145 billion) package designed to spur short-term consumer spending and get businesses investing again.Elsewhere, gold gained along with silver. Stocks in Asia were mixed. West Texas oil edged lower from a three-month high as OPEC+ unity was threatened by a long-running feud over compliance with production cutbacks.Here are some key events coming up:The U.S. labor market report on Friday will probably show American unemployment soared to 19.5% in May, the highest since the 1930s.Here are the major moves in markets:StocksThe S&P 500 Index fell 0.3% as of 11:21 a.m. New York time.The Nasdaq 100 Index fell 0.4%.The Stoxx Europe 600 Index declined 0.7%.The MSCI All-Country World Index rose 0.1%.CurrenciesThe Bloomberg Dollar Spot Index fell 0.5%.The euro rose 0.9% to $1.134.The British pound rose 0.3% to $1.2606.The Japanese yen strengthened 0.1% to 109.01 per dollar.BondsThe yield on 10-year Treasuries rose seven basis points to 0.81%.Germany’s 10-year yield rose four basis points to -0.31%.Britain’s 10-year yield rose four basis points to 0.31%.Australia’s 10-year yield rose five basis points to 1.01%.CommoditiesWTI crude fell 1.6% to $36.69 a barrel.Gold strengthened 0.4% to $1,707.27 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The May jobs report is expected to show another historic print in non-farm payroll losses alongside a surge in the unemployment rate to the highest level since the 1930s, extending the virus-related labor market devastation of the past few months.
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The NYSE FANG+TM Index, which includes Facebook Inc, Apple, Amazon.com Inc, Netflix and Alphabet Inc, hit an intraday record high in morning trading. "The market is due for a pause," said Christopher Grisanti, chief equity strategist at MAI Capital Management in Cleveland, Ohio. "It's really important to realize that U.S. equity investors have been given a great gift in the middle of what is probably the deepest recession in 80 years," he said, referring to the strong run for Wall Street since late-March.
Benchmarks ended in the green on Wednesday on signs that the economy is close to bottoming-out.
(Bloomberg) -- “Recovery trade” has become too flaccid a term for what’s going on in the stock market, courtesy of the Federal Reserve.The S&P 500 has surged almost 40% since March 23, its fastest advance since 1933. The Nasdaq 100 briefly erased all its losses on Wednesday. Corporate borrowers are issuing debt at a record clip as short bets against high-yield bonds evaporate. And with Treasury yields pinned down by interest rates close to zero, valuation models that plot corporate earnings against bond payouts show stocks -- somehow --remain historically cheap.It’s nothing new -- it’s just lasting longer than anyone expected. With equities powering past millions of lost jobs, images of protesters facing off with police over racism and daily reminders of the coronavirus’s economic toll, some market-watchers are seeing shades of moral hazard. By injecting massive liquidity through Treasury purchases and backstopping corporate bond markets, they say, the central bank is bailing out businesses that may have struggled and fomenting wealth inequality. At the investor level, it’s cover to pile in to riskier assets with little chance of losses.“The Fed indicating that they’re going to keep interest rates low for a very long period of time, that they’re going to be supportive of the corporate bond market -- in essence what you’re doing is you start to incentivize risk taking,” said Brian Levitt, global market strategist at Invesco. “There’s a lot of money on the sidelines collecting zero for a long period of time, investors start to think about how to allocate that money.”In Chairman Jerome Powell’s own words, policy makers acted “forcefully, proactively and aggressively” to combat the effects of the virus on the U.S. economy. The raft of support measures that followed included nine special lending facilities aimed at money markets, municipalities and the credit markets, among others.The impact was immediate: the S&P 500 bottomed on March 23, the same day that the Fed announced it would take the unprecedented step of buying corporate debt and exchange-traded funds tracking those securities. A record $27 billion flowed into fixed-income ETFs in May after the Fed kick-started its bond-buying program on May 12.Lifelines are visible in stock market’s most battered corners. Economic reopening optimism has boosted the small-cap Russell 2000 by nearly 16% over the past month, outpacing the broader S&P 500’s 10% gain. Retail brands such as Gap Inc. and L Brands Inc. have both surged by nearly 53% over that time, while easing global lockdown measures have buoyed shares of Royal Caribbean Cruises Ltd. by 42%.S&P 500 futures contracts slipped Thursday after the underlying gauge rallied 3.1% in the prior four days.The Fed’s actions have drawn criticism from high-profile naysayers such as Scott Minerd, chief investment officer at Guggenheim Investments, who said Wednesday that the central bank sent the world a “buy signal” through its programs propping up the corporate bond market. That concern has been echoed by Fed veterans such as William Dudley.“People who have high-yield debt outstanding, a lot of times that happens by choice,” said Dudley, former New York Fed president, in a Bloomberg Television interview. “For the Federal Reserve to intervene and support those asset prices, is basically creating a little bit of a moral hazard in the sense that you’re encouraging people to take on more debt.”In addition to the lending facilities, the Fed also slashed rates to near zero and pledged unlimited quantitative easing, ballooning its balance sheet to $7 trillion. That’s confined benchmark 10-year Treasury yields to an 18-basis point range over the past month near historically low levels. By some measures, that makes stocks more attractive: one fashionable indicator, the price-liquidity ratio -- which compares S&P 500 market cap versus total money supply -- suggests that equities actually look cheap, even as earnings collapse.“The potential is there for another bubble in financial assets. I view the Fed as another data point in the supply demand equation and the old adage of “don’t fight the Fed” comes to mind,” said Dan Russo, chief market strategist at Chaikin Analytics. “Does that have the potential to inflate bubbles? Yes.”Of course, it’s hard to argue that the Fed had other options when faced with a pandemic of unprecedented proportions and an all-but-guaranteed recession. Even with the raft of emergency measures, the extent of the economic damage has been catastrophic. The U.S. unemployment rate is expected to surge to 19.5% in May, after spiking to 14.7% the prior month. Average hourly earnings are forecast to rise by 8.5% on a yearly basis, suggesting that the hardest hit have been low-income earners.Powell himself has acknowledged the extreme length the central bank has gone to in order to cushion the economy. He insisted that the Fed’s policies “absolutely” don’t add to inequality and said the central bank’s real aim is to preserve jobs by keeping companies afloat.“Think about where we were in early April with inflation expectations close to one and falling and 6 million people joining the ranks of the unemployed,” Invesco’s Levitt said. “If the Fed doesn’t respond to that or even tightens in that environment like they did during the Great Depression, you exacerbate the situation and make it far worse.”Still, the ensuing equity rally born from those policies has bedeviled bears and is even starting to confuse the bulls. For Albert Edwards at Societe Generale, who is sticking to his bearish call on mega-cap technology stocks, it’s been an exercise in frustration.“We are now only 10% from February’s all-time high, and with the U.S. unemployment rate heading toward 20%, one might ask: At what point does the stark disconnect between Wall Street and Main Street become a political embarrassment for the Fed?” Edwards wrote in a note last week. “Maybe never.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
We have narrowed down our search to five S&P 500 stocks that popped more than 20% in the past month and still have upside.
With Wall Street notching a 50-day rally amid signs of the economic slump bottoming out and history hinting further gains, investing in stocks that are poised to gain in the near term seems judicious.
The stock market has rebounded nicely. One surprising underperformer is Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), which historically has done rather well in turbulent markets. In fact, the S&P 500 has had 11 negative years since Warren Buffett took control of the company in 1964 and Berkshire outperformed the market in all but two of them.
The S&P 500 bank index <.SPXBK> has kicked off June with an 8% advance so far, following a two-day rally of 15% last week. The bank index soared 5% Wednesday after U.S. private payrolls declined less than expected in May, suggesting that layoffs were abating as businesses reopened due to easing of stay-at-home restrictions related to COVID-19. Banks have also been helped by renewed interest in value stocks over growth investments.
(Bloomberg) -- Measures of stock-market breadth show that the damage done during the coronavirus-fueled slump is largely repaired, and that is a bullish signal for equities, according to an analysis from Sundial Capital Research.McClellan Summation Indexes, which track the momentum of the underlying breadth of stocks moving in a benchmark, now show a “complete recovery,” Sundial’s Jason Goepfert wrote in a note Wednesday. Such a move higher in the NYSE version has historically been a good sign for stock performance in coming months, even more so when the healing happens as quickly as it has here, he said.“The rally has lasted long enough, and has been widespread enough, that longer-term breadth measures are recovering from their March devastation,” Goepfert wrote. Forward returns were “excellent” during periods in the past when the gauge swung to such a large degree within two months, he said.Almost all major indexes tracked by Sundial now have positive McClellan Summation Indexes, according to the report. What’s more, Goepfert found seven instances since 1962 when the NYSE’s McClellan Summation Index recovered from below -1,000 to above +500 within 40 days -- and in every instance, the S&P 500 was higher two weeks out, as well as three months and one year afterward.“What makes this recovery more impressive is how broad it is. Not just within the S&P 500 or even the NYSE, but across markets and across regions,” he wrote in the report. “It’s hard to ignore this.”By no means is Goepfert a perma bull. He has questioned multiple aspects of the market recovery in recent weeks, including the small group of stocks dominating gains and extreme bullishness by small options traders that he said is a bad sign for equity performance.He even has a caveat on the McClellan Summation data: investors should be aware of anything that claims perfection, and ideally, he would look for “some kind of medium-term digestion to work off signs of shorter-term speculation and overbought conditions,” he concluded.(Adds background in sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Top news and what to watch in the markets on Thursday, June 4, 2020.
(Bloomberg) -- Japanese stock valuations have trailed U.S. levels for a long time, but the recent rebound from the coronavirus selloff has driven the gap into new territory.The Topix index’s climb into bull-market zone has left it trading at around 16 times earnings estimated for the next year, near the highest level since 2013. Yet the multiple on the S&P 500 Index has surged even faster to around 22 times. While Japanese stocks have been at a discount consistently since 2013, the gap now is the largest in data compiled by Bloomberg going back to 2005.“While U.S. stocks have enjoyed ever-greater multiple expansion, Japan has seen relentless multiple compression,” CLSA Ltd. strategist Nicholas Smith wrote in a report Wednesday. “Japanese valuations are tightly correlated with foreign buying, and foreign investors are now heavily underweight Japan.”Overseas traders were net sellers of the nation’s equities in 14 of the past 16 weeks, withdrawing a total of nearly 7.3 trillion yen ($67 billion) in stocks and futures since mid-February. Smith said the pessimism of foreigners was unwarranted given Japan’s relatively light toll from the pandemic.UBS Group AG shares a similarly positive view. Japan is one of the best-placed markets to benefit as the global lockdowns gradually ease, according to strategists led by Niall MacLeod. The broker maintained its overweight view on the country’s stocks in a note dated Thursday, citing their “cyclicality” as economies start to rebound as well as their cash-generating capabilities.(Updates with latest market, foreigner transaction data)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
U.S. stock markets have been on a tear this week, with the Nasdaq Composite, the S&P 500, and the Dow Jones Industrial Average all close to overtaking their all-time highs reached in February. Markets have climbed a virtual wall of worry to head higher over the past several sessions, shrugging off sometimes violent mass protests across the United States over police brutality and racial inequality. At current levels, the tech-heavy Nasdaq is less than 2% away from its record high.
World equity markets dipped Thursday after a three-day rally and European government bonds edged higher as worse than expected U.S. economic data pointed to a long road to recovery from the coronavirus pandemic. Market optimism over an economic rebound has helped push global equities to three-month highs and overshadowed concerns ranging from rising tensions between the U.S. and China and the worst period of civil unrest in the U.S. in decades.
European equities [.EU], oil [O/R] and euro markets [/FRX] had been lower before the ECB said it would nearly double the size of its Pandemic Emergency Purchase Programme to 1.35 trillion euros, extend it until June 2021 at the earliest and re-invest the proceeds until at least the end of 2022. Safe-haven German 10-year bond yields climbed to their highest since mid-April at -0.32% <DE10YT=RR>, 20-year yields went positive for the first time since January and benchmark U.S. Treasury 10-year yields <US10YT=RR> rose 0.8%.
Today we look at three "cheap" stocks trading under $10 a share that might be worth buying as the market continues to march higher on coronavirus reopening optimism and more...