Market Thoughts Morning Jan 4 2019

Jan. 04, 2019 8:18 AM ET
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Pat Stout's Blog
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Macro, Contrarian, Bonds

Contributor Since 2012

Since 1978 have experienced and studied many market cycles in bonds, stocks, options, etc. Tend to question herd thinking, some might call me a contrarian. A big mistake made when young (1970’s) by avoiding bonds and investing in risky stocks. It was a great lesson in risk management. Seek long-term strategic trends while keeping an eye open for short-term tactical opportunities. Pay close attention to cash-flow statement, balance sheet and the allocation of capital. Warning flags go up when board of directors allocate owners money to departing owners via share repurchase programs. Very few share repurchase programs have been found that add value, but many that hurt fixed income investors.

Summary

  • Big nonfarm payroll number to be released.
  • Federal Reserve Chairman Powell speech.
  • S&P 500 futures up 30.25 points in pre-market trading to 2,478.00.

Nonfarm payrolls to be released at 8:30 am ET, release here

Federal Reserve Chairman Powell gives a speech at 10:15 am ET, watch here

S&P 500 futures up 30.25 points in pre-market trading to 2,478.00

The House in Congress passed two bills to reopen government.

Keep an eye on the Tweeter feed.

Yesterday Thought:

The S&P 500 level of 2,460 is seen as key.

Chart
^SPX data by YCharts

The S&P 500 index tested and broke the 2,460 level, but this morning S&P 500 futures have rebounded higher. Time will tell if the 2,460 level holds.

Disclosure: I am/we are long SPY.

Additional disclosure: Long S&P 500 index, may use put or call options to adjust exposure.

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