News for the Week of February 12-16, 2018

PLEASE NOTE: The stories reported below are for informational purposes only to educate our clients on the weekly news stories; real, funny, educational, and otherwise. The source of charts and most news will stem from the Wall Street Journal (WSJ), Financial Times (FT), Barrons (B), Business Week (BW), and Bloomberg (Bbg). The purpose of this is NOT to solicit any offers to buy or sell stocks, mutual funds, commodities, or other financial assets – merely to report the news. Please call us to discuss any investment questions you may have. Additionally, we will not take sides in any political or religious news that we report, we will only present the objective facts, and perhaps opine on them from a neutral perspective. Finally, the opinions represented are those of David Abuaf, and not necessarily of Forman Investment Services or Raymond James or its affiliates.

 

 

We’re looking for a Client Service Specialist to join our team!

Job details are available on our website at www.formanis.com/careers

 

 

PLEASE NOTE: The stories reported below are for informational purposes only to educate our clients on the weekly news stories; real, funny, educational, and otherwise. The source of charts and most news will stem from the Wall Street Journal (WSJ), Financial Times (FT), Barrons (B), Business Week (BW), and Bloomberg (Bbg). The purpose of this is NOT to solicit any offers to buy or sell stocks, mutual funds, commodities, or other financial assets – merely to report the news. Please call us to discuss any investment questions you may have. Additionally, we will not take sides in any political or religious news that we report, we will only present the objective facts, and perhaps opine on them from a neutral perspective. Finally, the opinions represented are those of David Abuaf, and not necessarily of Forman Investment Services or Raymond James or its affiliates.

 

 

We’re looking for a Client Service Specialist to join our team!

Job details are available on our website at www.formanis.com/careers

 

 

News for the Week of February 12 to February 16, 2018

PLEASE NOTE: The stories reported below are for informational purposes only to educate our clients on the weekly news stories; real, funny, educational, and otherwise. The source of charts and most news will stem from the Wall Street Journal (WSJ), Financial Times (FT), Barrons (B), Business Week (BW), and Bloomberg (Bbg). The purpose of this is NOT to solicit any offers to buy or sell stocks, mutual funds, commodities, or other financial assets – merely to report the news. Please call us to discuss any investment questions you may have. Additionally, we will not take sides in any political or religious news that we report, we will only present the objective facts, and perhaps opine on them from a neutral perspective. Finally, the opinions represented are those of David Abuaf, and not necessarily of Forman Investment Services or Raymond James or its affiliates.

 

 

We’re looking for a Client Service Specialist to join our team!

Job details are available on our website at www.formanis.com/careers

 

 

PLEASE NOTE: The stories reported below are for informational purposes only to educate our clients on the weekly news stories; real, funny, educational, and otherwise. The source of charts and most news will stem from the Wall Street Journal (WSJ), Financial Times (FT), Barrons (B), Business Week (BW), and Bloomberg (Bbg). The purpose of this is NOT to solicit any offers to buy or sell stocks, mutual funds, commodities, or other financial assets – merely to report the news. Please call us to discuss any investment questions you may have. Additionally, we will not take sides in any political or religious news that we report, we will only present the objective facts, and perhaps opine on them from a neutral perspective. Finally, the opinions represented are those of David Abuaf, and not necessarily of Forman Investment Services or Raymond James or its affiliates. 

We’re looking for a Client Service Specialist to join our team!

Job details are available on our website at www.formanis.com/careers

 

News for the Week of February 12 to February 16, 2018

 

by David Abuaf, CFA

Investment Manager, RJFS

 

General Markets / Economic

                                                                                                           

1.     The SEC rejected the sale of the Chicago Stock Exchange to a group that would have included Chinese investors

2.     US producer prices rose in January, the latest sign of building inflation pressure in the economy

3.     Consumer prices in January rose more than forecast, teeing up the expected first interest rate increase of the year in March

4.     FINRA is investigating whether prices linked to the VIX index (Chicago Board Options Exchange (CBOE) Volatility Index) have been manipulated by traders.

·       I think that’s unlikely, the VIX is implied volatility on 30-day options – pretty hard to manipulate across hundreds of thousands of contracts (let alone trades)

 

 

Company News

 

1.     Airbus and Boeing are cashing in on record demand for new planes

2.     Cisco said it would repatriate $67B of its foreign cash holdings to the US, following changes to US tax law

3.     Amazon is pushing to turn its medical supplies business into a major seller to hospitals and clinics

4.     Walgreens has made a takeover approach to drug distributor Amerisource, a move that could help boost the chain’s profitability

 

 

Commentary for the Week of February 12 to February 16, 2018

 

by David Abuaf, CFA

Investment Manager, RJFS

 

 

I’m dizzy, are you? In the week since the S&P 500 had closed down 10.16% from its all-time high on January 26, the benchmark has done nothing but go up!  This past week saw the S&P 500 go up 4.3%; its best showing in more than five years.

 

Even better (?), the S&P 500 closed the week on a six-day winning streak. However, after a run like that, the market may not have the juice to push much higher. “This seems like it’s a bit too aggressive,” says MKM Partners’ Michael Darda.

 

While anybody with a contrarian eye would say this is too much, too fast, it’s not entirely abnormal. Tony Dwyer of Canaccord Genuity notes the market is following a pattern usually seen after “shock drops.” In such cases, the initial tumble is followed by a big bounce, another drop to a new low, and finally a sustainable rally. “Ultimately, we expect a nasty retest of the low in the coming weeks but would aggressively buy it.”

 

More volatility would not be a surprise, nor out of the ordinary. Consider 2017, the S&P 500 had just eight 1% moves in either direction; this year, there have already been 10. At this rate, there’d be 78 1% plus moves in 2017; while unlikely, it isn’t out of the question as the rolling 12-month average of 1% moves spiked over 160 by the end of the financial crisis in 2009.

 

But a pickup in volatility doesn’t have to be a death knell for the bull market. In 1996, the S&P 500 gained 20.3% along with a strong pickup in 1% plus moves. Long story short, as the kids like to say TL;DR ("Too Long; Didn't Read"): don’t expect this year to be easy if you want to follow your money AND the market!

All opinions presented are those of David Abuaf, and not of Raymond James or Forman Investment Services. All opinions are as of this date and are subject to change without notice. Raymond James is not affiliated with a and does not endorse the services or opinions of any of the quoted professionals or their respective firms/ publications.

This information is not a complete description of the securities, markets, or developments discussed and has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation.  This information is not intended as a solicitation or an offer to buy or sell any security referred to herein.

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