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Monthly Archives: June 2010

Advantage Growth

 Watching the stock market lately has been like watching a very long tennis match. In the month of June, the S&P 500 has had nine up days and 10 down days ending up relatively unchanged. That is a lot of back and forth with little progress. This makes it fitting that last week’s Wimbledon first-round main draw match featuring John Isner against Nicolas Mahut lasted 11 hours over the course of ……

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www.mwboone.com/library/Weekly_Market_Commentary_6_28_10

No Summer Doldrums This Week

 Economic, monetary, and regulatory policy is likely to take center stage this week, as the economic data, soft of late, fades in importance. In addition to handicapping the outcome of the Federal Reserve (Fed) Federal Open Market Committee (FOMC) meeting, market participants will be mulling over the decision by Chinese authorities to allow the Chinese currency, the yuan, to move ……

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www.mwboone.com/library/Weekly_Economic_Commentary_6_21_10

Soft Spot

Back at the beginning of this quarter, we forecasted that leading indicators of economic and profit growth would be peaking during the second quarter (Weekly Market Commentary, “When Leading Indicators Peak”, April 5, 2010). We believe that the upward momentum in these measures has now peaked, including the closely followed Leading Economic Index (LEI) and the Institute for Supply Management‘s Purchasing Managers Index (ISM). (We note that the ……

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Is Our European Vacation About to End?

Investors embraced risky asset classes such as Equities, Commodities, and High-Yield Bonds, last week, as the latest global economic data revealed few signs of any significant slowdown in economic activity related to the still-unfolding European fiscal and liquidity situation. While there were a number of key economic data reports ……

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www.mwboone.com/library/Weekly_Economic_Commentary_6_14_10

 

Europe is Not the World

 With the markets’ movements in recent weeks driven almost entirely by news coming out of Europe it would seem that the European outlook must be central to the prospects for global economic and profit growth. However, evidence to the contrary was abundant last week as the stock ……

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www.mwboone.com/library/Weekly_Market_Commentary_6_14_10

Is the Labor Market Changing Course?

There was a torrent of economic data released in the United States last week as market participants continue to sift through the incoming data very closely, looking for signs of contagion from the European fiscal situation. The good news is that virtually none of the U.S. economic data released over the past week showed any signs of contagion including: ……

 

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www.mwboone.com/library/Weekly_Economic_Commentary_6_7_10

 

Current Conditions Index

Over the past week, the LPL Financial Current Conditions Index remained stable at about 208. The stock market has tracked the CCI closely this year as it did last year reflecting the attention investors are paying to real time measures of economic and market conditions ……

 

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www.mwboone.com/library/Current_Conditions_Index_6_9_10

 

One Hit Wonder

 Like a performer that can’t string together a series of big hits, the stock market has provided investors with big one-day moves with no follow up lately. Last week was another example of the one hit wonder stock market. On Wednesday, stocks jumped 2.6% only to be flat on Thursday and then on Friday stocks ……

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www.mwboone.com/library/Weekly_Market_Commentary_6_7_10

Buy in June and Stay Tuned

The old adage of “sell in May and go away” has been repeated so many times we are still often asked if this is a sound investing strategy. We do not find sound reasoning behind this maxim. Instead, we believe investors should “buy in June and stay tuned” this year.  

We expressed caution in mid-April, given our outlook for a pullback in the stock market. However, now that the pullback that began on April 23 has occurred, we have spent most of May calming fears of another stock market plunge and, in general, we believe ……

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Does the Economic Data Matter?

Last week’s batch of economic data for April and May in the U.S. came in better than expected, including:
·         New and existing home sales,
·         Home prices,
·         Consumer confidence,
·         Shipments and orders for durable goods,
·         First time filings for unemployment insurance, and
·         Inflation.
 

Taken together, the data suggest that the U.S. economy continued to make a successful transition from recovery to sustainable growth as the first quarter of 2010 ended and the second quarter began. Financial markets, however, are forward looking and largely ignored last week’s data ……

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www.mwboone.com/library/Weekly_Economic_Commentary_6_1_10