Beat the Market

Traders are having difficult time to find the direction today. Markets are divided, as Dow Jones has stayed green in most of the day, and Nasdaq has struggled throughout the day. As I said yesterday, I am afraid that the market will be choppy for the rest of the week. Money flows to Treasuries again so that yields fall: 30-year -0.7%. 10-yr -0.2%. 5-yr -0.1% . Commodities: Crude -2.6% to $61.7. Gold -0.9% to $1,317. Winners SNAP +47.1% skyrockets after its ER. TWTR +6.6% . HAS +8.8% as merger chatter pops up again! MAT +0.9% . Hasbro's Q4 sales fell off from a year ago. WYNN +8.6% as CEO steps down. Defense stocks are strong today. ETFs: ITA +1.4%, XAR +1.5% ; Stocks: BA +2.1%, NOC +3.1%, LMT +2.3%, UTX +1.6%, GD +1.2%... GILD +3% after ER. It is no surprise that revenue of HCV drops again to $1.5B. However, the Kite acquisition starts to bear fruits. CEO John Milligan said on the earnings call  that the company has authorized 28 cancer centers to administer Yes...

It is a choppy day. The early tradings are similar to yesterday --- opened low followed by a quick bounce. However, indices hung around afterwards and marched north around 2:30 pm. Dow +2.3% , S&P +1.7% & Nasdaq +2.1% . I think the -10% correction is over. The indices retreated back to pre-TAX-Reform level in the intraday low. However, it could remain the choppy way for near-term. Utilities has the worst performance, XLU -1.5% despite the broad market rally in late hours. Treasurys: 30-year -0.9%. 10-yr -0.6%. 5-yr -0.4% . 10-yr note stays @ 2.8%. Commodities: Crude -1.1% to $63.45. Gold -0.9% to $1,324 . The American Petroleum Institute (API) reportedly shows -1.05M barrels of crude oil for the week ending Feb. 1 vs. last week's build of +3.23M barrels. Gasoline reportedly shows -227K barrels and distillates show a build of +4.52M barrels. I think refiners face margin challenges. Yesterday, many analysts called for buying dip instead of being panic. Goldman's D...

The quick bounce in the morning turned out to be a trap. The selloff is so violent that there are almost no survivors. The deep dip  around 3pm is especially evil. The market is definitely in panic mode. Dow -4.6% to 24,343. S&P -4.1% to 2,649. Nasdaq -3.8% to 6,967. And the selloff continues in AH. The money floods into Treasuries : 30-year +1.12%. 10-yr +0.74%. 5-yr +0.51% . 10-yr note drops from above 2.85% to 2.7% (about last Tuesday/Wednesday level). This may calm some nerve. Currently it is hard to predict how much lower indices will go. I would suggest to prepare your own shopping list and start to add positions. I am fully positioned myself. I plan to hold and wait. Commodities: Crude -2.73% to $63.66 . Gold +0.28% to $1,341.00 . Bitcoin is also facing another run of selloff as major US & UK banks ban Bitcoin credit card purchases . The lowest price today is below $6600 from coindesk. To be honest, there is no particular bad economic news today. Ins...

So far, most companies ( 80% in S&P 500 beat) have reported great earnings and encouraging guidance. With the Thomson Reuters data out this Friday, the 2018 "estimated" S&P 500 earnings growth rate is 17.7% , up from last week's 16%. After the selloff last week, the average P/E of the S&P 500 17.8 . On Friday, I have written a brief analysis on the earnings of Apple / Amazon / Google / Facebook ( LINK ). I think there is no reason to be panic at this moment. After tax reform, the companies have more cash to invest or reward their shareholders. With rising salary and low interest rate (4.5% 30-year fixed mortgage is still considered low), US economy is doing fine now. As Earnings cool down, the stock market will focus on Treasury yields and politics. If treasury yield falls, I expect the stock market to bounce. Weekend News From Treasury Department Government expects to borrow $955B this fiscal year (Trump's 1st full year in charge of the budget)....

Some new investors are sometimes confused about dividend. In this article, I will try to answer some basic questions, and introduce dividend growth strategy. First Question: What is Dividend? Dividend is a sum of money paid regularly (typically quarterly) by a company to its shareholders out of its profits (or reserves). As a company declare the coming dividend, you may see three dates: ex-div date , record date and payable date . The ex-div date is the date after which people buying shares would not be entitled to the dividend. If you buy shares prior to the ex-dividend date, you will receive the dividend. If you buy the shares on, or after the ex-dividend date, the seller keeps the dividend. You don't need to worry about record date, which is usually ex-div +1. Payable date is when you receive the dividend. Example : $1 div, ex-div 2/1, payable 3/1. You need to hold the stocks by the end of 1/31 (regular hours). If the stock price is closed at $100 on 1/31, it will s...

It is a bloody Friday. The economy added 200,000 jobs in January as the unemployment rate stayed at 4.1 percent. Treasury yields jump again, 10-yr note @ 2.84% . The high interest fear causes the panic sell in market today. As I said last weekend, market was facing selling pressure this week. For the week, Nasdaq -3.9%, S&P 500 -3.5%, Dow Jones -4.2%. Crude -1.09% to $65.08. Gold -1.09% to $1,333.20. Dollar recovers ( UUP +0.6% ). Another focus this week is the earnings from Big Four: Amazon, Apple, Facebook, Google 1. Cloud Service Amazon is known as online retailer. However, the majority operating income ( 60% ) comes from its AWS (Amazon Web Service Cloud), which presents 10% revenue in 2017. AWS is growing at 45% YoY, which is much slower than Microsoft ( 98% ) and Google (claimed to be the fastest). Therefore, Microsoft and Google are eroding the market share from Amazon. Behind this three are IBM and Oracle. IBM cloud is growing at 24% rate. 2. Advertising ...

Market today: Tech down, Treasury down, Dollar down. Treasury: 30-year -1.28%. 10-yr -0.49%. 5-yr -0.22%. 10-year note jumps to 2.78%. Commodities: Crude +2.18% to $66.14. Gold +0.74% to $1,353.10. The timing I mentioned yesterday happens again. Selling happened @ 1:30 pm and 3:00 pm. Winners EBAY +13.8% to all-time high after strong ER. Ebay is dropping PayPal ( PYPL -8.1% ) as its payment processor. Netherlands-based Adyen will gradually take PayPal's spot beginning this year, and will handle a majority of transactions in 2021. FB +3.3% also reached all-time high today after strong ER and bright future. Analysts are convinced by the growing Ad price, and raising their PT. Defense stocks are doing well today, for instance, GD +1.2%, LMT +0.7% .... Financial stocks are also performing well. GS +1.6%, MS +1.6%, BAC +1.6%, JPM +1%, C +0.9% .. Macau gross gaming revenue increased 36.4% in January, according to the Gaming Inspection and Coordination Bureau. LVS +...