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S&P 500

Oct 26 2018

Assessing The Damage

  • Oct 26, 2018

Our tactical accounts remain positioned very defensively, and we have yet to see the sort of capitulative market action that would lead us to lift any existing equity hedges.

 

Oct 05 2018

Estimating The Downside: The G-Rated Version

  • Oct 5, 2018

The longevity of this bull market is impacting tactical asset allocators in ways great and small.

Sep 08 2018

S&P 500—Valuation Check-Up

  • Sep 8, 2018

In late January we speculated how long it would take for the S&P 500’s bloated valuations to reach more reasonable levels. The S&P 500 now trades back where it was in January and the seven-month break included some of the best growth rates most have ever seen. We found ourselves asking: Did chubby Mr. Market shed any pounds as he pedaled away on his stationary bike?

Sep 08 2018

Breakout Or Fake-Out?

  • Sep 8, 2018

The S&P 500 has fully erased its January and February losses, but there’s probably a market message in the fact that it took so long to do so.

Sep 08 2018

Beware The Breakout

  • Sep 8, 2018

The S&P 500 finally erased the losses from its nine-day swoon in January and February.

Aug 07 2018

Assessing The Correction

  • Aug 7, 2018

How do today’s cyclical conditions stack up with those accompanying other stock market declines? 

Aug 07 2018

A Launching Pad??

  • Aug 7, 2018

A few clients pointed out that the longest-ever recovery from an intermediate correction (Apr. 1994–Feb. 1995) became the base from which the S&P 500 would eventually triple over the next five years. We’re not equipped to address that possibility in an objective fashion, so we’ll let you be the judge.

Aug 03 2018

No, It’s Not Y2K Again…But The Lights Could Still Go Out

  • Aug 3, 2018

For the last year, we have labeled the S&P 500 Price/Sales ratio—which has returned to its Y2K bubble levels—the “scariest chart in our database” (Chart 1). Recall that the initial visit to present levels was followed by the S&P 500’s first-ever negative total return decade.

 

Jul 27 2018

How The S&P 500 Could Hit 2,500… Ten Years Out

  • Jul 27, 2018

Yesterday was the six-month anniversary of the S&P 500 bull market high, and the index celebrated the event by nearly setting a new peak. Meanwhile, the S&P 500 Total Return Index did make a new high on Wednesday.

Jul 07 2018

Multiple Personality Disorder?

  • Jul 7, 2018

Market behavior is always nebulous enough to generate diverging opinions, but lately it’s been sufficiently strange to give rise to a diverging set of facts.

Jun 15 2018

Full Employment And Rising Prices Aren’t Stock-Friendly

  • Jun 15, 2018

Annual Producer Price Inflation rose to 4.0% in May, a key threshold above which the S&P 500 has historically delivered essentially flat returns. But the fact that this reading occurs against a backdrop of full employment is cause for even more concern. Context is key...

Jun 07 2018

Is The Bull Just Napping?

  • Jun 7, 2018

Old age has certainly put no limitations on the bull’s exploits, so we should be cautious in reading too much into its meandering recovery path. However, it’s possible that action since the February low is not a recovery process but rather a countertrend bounce within a larger downtrend.

Jun 01 2018

If You Think This Market’s Fishy, You’re Right

  • Jun 1, 2018

Tomorrow is the Minnesota season-opener for muskies, but the fanatics who chase them are likely disappointed that it comes a few days after an event that’s known to trigger these beasts: the full moon. The screenshot is from our $9.95 “iSolunar” iPhone app, and shows that Saturday merits only a “three fish” day (out of a possible “four fish”)—based on the moon’s fading illumination. 

 

May 05 2018

A New Hurdle For An Old Bull?

  • May 5, 2018

The first quarter S&P 500 earnings “beat” rate stands to be the highest in history, as any CEO with a pulse has learned to lower the hurdle.

May 05 2018

The “Correction” Clock Is Ticking

  • May 5, 2018

2018’s S&P 500 setback qualifies as an “intermediate” correction. Historically, the duration of intermediate corrections is brief, and recovery time to move back above prior highs has also been brief. This year’s retracement route is already among the most meandering of all recovery paths since 1950.

May 04 2018

Market Corrections And The Hazards Of Old Age

  • May 4, 2018

In difficult markets, we have become more appreciative of some of life’s small gifts. For example, it’s been quite a while since we’ve heard it argued that this is “the most hated bull market of all time.”

Apr 06 2018

Musings On Margins

  • Apr 6, 2018

Fourth quarter earnings were the last ones to be burdened by a 35% top marginal corporate income tax rate, and therefore seem to have been given a pass by the analyst community.

Apr 06 2018

Assessing The Selling

  • Apr 6, 2018

While the January 26th bull market high illustrated none of the hallmarks of a major cyclical top, there are secondary signs that a stealthy distribution process may be underway, such as an overwhelming bias toward opening market strength followed by intraday weakness.

Mar 07 2018

Mid-Term Mayhem?

  • Mar 7, 2018

The prospect of a mid-term congressional shake-up may rattle the markets in 2018. Since 1962, nine major bear market lows occurred during mid-term election years, with eight of those happening during the traditionally weak months of May through October.

Mar 07 2018

A Near-Perfect Model You Should Ignore

  • Mar 7, 2018

We somehow missed this signal in January, perhaps because we were pre-occupied with so many other signs of “climate change.”

Mar 07 2018

1987 Parallels (Part 2)

  • Mar 7, 2018

At the risk of yelling “fire” in a crowded theater, we present a few parallels between recent action and the year leading up to the October 1987 crash.

Feb 07 2018

Multiple Contraction—Just A Little Patience?

  • Feb 7, 2018

Things were bigger when you were a kid. Like that enormous sweatshirt your aunt gave you for your birthday or that hand-me-down ten-speed bike with the cross bar taller than your shoulders.

Jan 06 2018

Estimating The Upside?

  • Jan 6, 2018

The remarkable stock market breadth and momentum chronicled in these pages doesn’t come without a price.

Jan 06 2018

Kicking Off The Year... With A Good Year

  • Jan 6, 2018

During the first four trading days of 2018, the S&P 500 managed to match its 93-year average annual real price gain of +2.6%.

Dec 14 2017

Is The Market Too Strong To Top Out?

  • Dec 14, 2017

We observed in July that at an age when most bull markets are prepared to see the mortician, this one still seems to need a pediatrician. And five months later, the bull is acting as immature as ever!

Dec 08 2017

Yawn? Another Sentiment Warning

  • Dec 8, 2017

The stock market has disregarded any and all caution flags throughout 2017, and the consensus is that it will continue do so through year-end.

Nov 17 2017

The Seasonality Of Earnings Season

  • Nov 17, 2017

Years ago, Monty Python’s classic comedy sketch introduced us to the Department of Redundancy Department.

Nov 07 2017

Cap Weight Or Equal Weight?

  • Nov 7, 2017

The Equal Weighted S&P 500 now trails the S&P 500 by 400 basis points YTD, and the rally is increasingly assailed as too narrow.

Nov 07 2017

A Longer-Term Take On Sentiment

  • Nov 7, 2017

Stock market bears had a field day when the latest Investors Intelligence sentiment survey (Chart 1) saw the percentage of bullish newsletter writers spike to its “highest level since 1987.”

Nov 07 2017

Revisiting The Y2K Highs

  • Nov 7, 2017

Bobby Knight thought coaching would be perfect “if it weren’t for those damned games.”

Nov 03 2017

Time To Embrace "Equality"?

  • Nov 3, 2017

While this year’s rally has been a broad, “equal opportunity” affair, some of the weakest relative action we’ve observed has—oddly enough—been among equal-weighted stock market indexes. Equal-weighted indexes for Large, Mid, and Small Caps are all trailing their cap-weighted counterparts year-to-date, and the gap for the S&P 500 is now almost 400 basis points after an especially bad October.

Oct 06 2017

Stocks Versus Your “Personal” Inflation Rate

  • Oct 6, 2017

While the bull possesses a seemingly endless supply of energy, the Leuthold database still houses a supply of measures by which the bull market has fallen short.

Oct 06 2017

Stocks And The Economy

  • Oct 6, 2017

The stock market is often maligned as a poor economic forecaster, and it’s true the market has predicted several more recessions than have actually occurred.

Oct 06 2017

How To Double Your Money In Ten Years

  • Oct 6, 2017

Before the markets punish an irresponsible act, they must first reward it.

Sep 22 2017

A Statistical Take On The Fourth Quarter

  • Sep 22, 2017

We just completed a simple study for those market bulls who might find themselves temporarily lacking in confidence (assuming such an animal isn’t extinct by now).

Aug 18 2017

Turning Another Page On The Earnings Calendar

  • Aug 18, 2017

The end of August means the second quarter earnings season is almost in the books.

Jul 08 2017

Beatlemania And Narrow Markets

  • Jul 8, 2017

In April 1964, the Beatles simultaneously held the top-five spots on the Billboard Hot 100, a unique feat in the history of modern music.

Jun 30 2017

Does First Half Stock Market Strength Carry Over Into The Second Half?

  • Jun 30, 2017

Does the stock market’s first half performance tell us anything about its likely path in the second half? Not on the face of it.

Jun 02 2017

Assessing Yesterday's New High

  • Jun 2, 2017

Traders like to say there’s nothing more bullish than a new price high, but not all new highs are created equal.

May 19 2017

Keep An Eye On This Spread

  • May 19, 2017

For years, the Cabot Market Letter has tracked a “Two-Second Indicator” that’s based on the number of NYSE New 52-Week Lows.