Stocks

Stocks Likely to Remain Volatile Amid Trade Disputes

The stock market could see ongoing volatility next week as rising political risks compete against a strong domestic economy. Friday's jobs report was better than expected at 213,000 jobs added, but it doesn't factor in the impact of the trade war between the United States and China (and other trade partners), which could slow hiring in the manufacturing sector, disrupt the supply chain and raise prices for consumers. Reality could set in next week after last week's $34 billion tariff swap. Next week, traders will be keeping a close eye on several economic indicators, including the consumer price index and jobless claims on July 12 and consumer sentiment data on July 13. Price inflation will continue to be a primary area of focus as the Federal Reserve looks to continue its hawkish policy. (See also: US Markets Hit Pause Button Ahead of Earnings.) Read more: Stocks Likely to Remain Volatile Amid Trade Disputes | Investopedia https://www.investopedia.com/news/stocks-likely-remain-volatile-amid-trade-disputes/#ixzz5KgZozjFy Follow us: Investopedia on Facebook There could be ongoing volatility in the stock
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Disney Is Rising Along Its Reversion to the Mean

The Walt Disney Company released two consecutive better-than-expected quarterly earnings reports on Feb. 6 and May 8, and the stock has been slowly climbing its 200-week simple moving average since the week of Sept. 8, 2017. This "reversion to the mean" is now at $102.49. This is a longer-term indication that Disney stock may be losing its mantra as being dead money. Disney shares closed Friday, June 8, at $103.98, down 3.3% year to date and 8.1% below the 2018 high of $113.19 set on Jan. 3. The stock is up 6.4% since it set its 2018 low of $97.68 on May 3. Disney has been disappointing investors since setting its all-time intraday high of $122.08 back on Aug. 4, 2015. This report was the first that showed warnings for its ESPN franchise. Helping the Mouse House now is Disney's planned deal to acquire significant assets from Twenty-First Century Fox, Inc. . The potential deal does
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Donald Trump lobs a grenade from afar into the G7

By The Economist online... FOR a moment, the Group of Seven (G7) leaders attending their annual summit, in a mountain village in Quebec, looked like they had managed to paper over their differences with President Donald Trump and present a united front. They found just the right wording to secure American agreement on matters that never used to be in question, such as supporting democracy, abiding by international-trade rules and fighting terrorism. Even Mr Trump professed himself pleased, calling the summit wonderful and rating his relationships with other leaders as ten out of ten. Yet barely ten minutes after the official communiqué was published, he changed his mind. He tweeted from somewhere over the Pacific, en route to his “mission of peace” in Singapore with Kim Jong Un, North Korea’s despotic ruler, that he had instructed his officials not to endorse the communiqué. He attacked Justin Trudeau, Canada’s prime minister
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The long arm of the dollar

By The Economist online.... FEW banks can match the quaint serenity of Banco Delta Asia’s headquarters in Macau. Housed in a pastel-yellow colonial building opposite a 16th-century church, its entrance is flanked by tall vases, depicting sampan gliding between karst hills. In the tiled square outside, men laze under a banyan tree and an elderly woman peels a boiled egg for lunch. But in 2005 this backwater bank incurred the wrath and might of the world’s financial hegemon. America’s Treasury accused it of laundering money for North Korea, prompting depositors to panic, other banks to keep their distance and the Macau government to step in. The Treasury subsequently barred American financial institutions from holding a correspondent account for the bank, excluding it from the American financial system. Macau is over 8,000 miles from Washington, DC. But it is hard to escape the long arm of the dollar. Its dominance reflects
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Small Caps in Russell 2000 Break Out to Fresh Highs

Small-cap stocks in the Russell 2000 have outperformed the S&P 500, Dow Jones Industrial Average and technology stocks in the NASDAQ Composite over the past three months. While many larger companies have been struggling to cope with a potential trade war, small caps conduct most of their business in the United States and aren't affected by these risks. At the same time, these companies are well positioned to benefit from the lower corporate tax rate. The iShares Russell 2000 ETF rose more than 1% to new all-time highs following its breakout from an ascending triangle pattern on Wednesday. According to iShares, the fund's average P/E ratio clocked in at 20.91x, which is still lower than the S&P 500's 24.78x P/E ratio. Many investors may be drawn to the lower earnings multiples for these companies compared with the lofty multiples seen at larger companies in the S&P 500 and DJIA. (See also: IWM vs. VTWO: Comparing U.S. Small-Cap ETFs.) Small-cap stocks have been quietly outperforming
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Walmart Reports Oversold and Below ‘Death Cross’

Retail giant and component of the Dow Jones Industrial Average Walmart Inc. was a strong momentum stock as 2018 began, but that dynamic turned on a dime after the stock set its all-time intraday high of $109.98 on Jan. 29. At this high, Walmart stock was in an "inflating parabolic bubble" with a weekly stochastic reading above 90 on a scale of 0 to 100. This bubble popped as the stock crashed into bear market territory, where it remains today. Walmart had been above a "golden cross" between April 21, 2017, when the stock closed at $74.94, and April 26, 2018, when the stock closed at $87.94. Then, a "death cross" formed. A "golden cross" forms when the 50-day simple moving average rises above the 200-day simple moving average and indicates that higher prices lie ahead. A "death cross" forms when the 50-day simple moving average falls below the 200-day simple moving average and indicates that lower prices
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Caterpillar Stock Could Test 2018 Lows

Dow component Caterpillar Inc. reversed on Tuesday after failing to reach the high posted when April 24 earnings triggered an opening rally followed by a 17-point slide. In turn, this bearish price action could presage a decline to multi-month lows that also completes the last leg of a broad topping pattern, raising the odds for a breakdown that ends the equipment giant's long-term uptrend. Caterpillar needs cordial relations with China to continue on the fast track, but trade tensions are taking their toll. Meanwhile, the Asian nation just reported weaker-than-expected investment, along with a slowdown in retail and home sales. More ominously, business surveys noted a sharp decline in export order growth that may reflect local company efforts to avoid getting caught with unsold goods during a trade war. In 2017, Caterpillar saw the first sales growth in five years, with the slump driven by a Chinese construction slowdown and weak oil prices. Meanwhile, first quarter U.S. GDP dropped to 2.3%,
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J. C. Penney Remains an ‘Option on Survival’ Into Earnings

Mall anchor J. C. Penney Company, Inc. reports earnings before the opening bell on Thursday, May 17, as an "option on survival," as the stock is trading between $1 and $3 per share. Investors buying a stock in this trading range are betting that the company will survive its current woes and eventually thrive once again. In these situations, it is wise to invest only funds that you can afford to lose completely if the stock becomes worthless. J. C. Penney stock closed Tuesday, May 15, at $2.91, down 7.9% year to date. Shares of J. C. Penney are solidly in bear market territory at 38.7% below the 2018 high of $4.75 set on Feb. 27. The stock is also 7.8% above its 2018 low of $2.70 set on May 8. (See also: Billionaire David Einhorn's Greenlight Bought 6M J. C. Penney Shares: 13F.) Analysts expect J. C. Penney to post a loss of between 19 cents and 22 cents
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3 Casino Plays Primed for Sports Betting Profits

The U.S. Supreme Court ended Nevada's sports betting monopoly and opened that door for other states in a six-to-three ruling on Monday. Justices agreed that a 1992 Federal prohibition violated constitutional principles, triggering strong rallies in casino operations thousands of miles from the Las Vegas Strip. Meanwhile, Nevada's biggest companies sold off or ran in place, held down by the threat of lost revenues Market players scrambled to find stocks that could profit from the ruling, and three names have risen to the top of the heap – Scientific Games Corporation  Penn National Gaming, Inc. and International Game Technology PLC  New Jersey is likely to offer sports betting at race tracks within weeks because the state brought the lawsuit and will have infrastructure ready to go by Memorial Day. Pennsylvania, West Virginia, Mississippi and New York could follow suit quickly, while another 12 states have introduced related legislation. (See also: Understand Betting Odds
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3 Charts That Suggest It’s Time to Buy Precious Metals

Precious metals tend to be the commodity segment of choice for those looking shelter against market volatility and uncertainty. Given the rising geopolitical tension, as evident by the stories that have dominated the headlines in recent days, traders will become more sensitive to headline risk, and a seemingly small story could act as catalyst for increased buying pressure in gold, silver, platinum and palladium. In this article, we take a look at the charts of three exchange-traded funds (ETFs) that are commonly used for gaining exposure to these metals and analyze how traders will look to position themselves for a move higher. (For further reading, check out: When in Doubt, Buy Precious Metals.) PowerShares DB Commodity Index Tracking Fund Some investors may not quite feel comfortable with an overweight position in precious metals and may prefer to have diversified exposure to a broad basket of commodities. One potential solution for this group of investors could be to look to the PowerShares DB
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