Bullish sentiment rose to its highest level since March 29, 2012, even as bearish sentiment stayed above its historical average for the 15th consecutive week in the latest AAII Sentiment Survey.
There’s a popular saying that stocks climb a wall of worry. But one could also say that bonds also climb a wall of worry. A wall of worry over inflation. For years (really decades), there have been persistent fears of surging inflation. And those fears just never come to fruition. That doesn’t mean they can’t come to fruition in the [...]
The recent decline in the series is consistent with a moderation in inventory investment in the current quarter, and hence a decline in the contribution from inventory investment to real GDP growth. A simple regression of quarterly inventory investment on our indicator [R-squared = 0.8] suggests that inventory accumulation could fall by $34 billion in Q4 ($135 billion at an annual rate) to $27 billion, enough to detract roughly a full percentage point from Q4 real GDP growth if taken at face value.
The ISI Tech Company Index (see discussion) shows continuing weakness. The survey, which is heavily weighted towards US semiconductor firms, is now at the lows of 2008/09. It seems that firms have been postponing spending on equipment and to a lesser degree on software. The obvious explanation is the uncertainty in Washington.
Bullish sentiment registered above 40% for the first time since August 23, 2012 in the latest AAII Sentiment Survey. Bearish sentiment continues to stay above its historical average, however.
As always, here are some seasonal data points from the Stock Traders Almanac for the month of December. Historically, December is the best month of the year and is especially strong for high beta names: ◆ #1 S&P (+1.6%) and #2 Dow (+1.7%) month since 1950, #2 NASDAQ (2.0%) since 1971 ◆ 2002 worst December since 1931, down over 6% Dow and [...]
Rail traffic continues to be a bright spot in the US economy though growth has definitely slowed some in recent months. This week’s traffic trends showed a rise in intermodal traffic at a 2.4% year over year rate. That brings the 3 month average to 2.35%. I think this data is one of many indicators that continues to point to [...]
More of the same here. Rail traffic is still expanding, but showing definite signs of sluggishness. This week’s reading of 1.9% brought the 3 month average to 2.6% growth. That’s certainly in-line with the growing, but very sluggish economy. Here’s more from the AAR: “The Association of American Railroads (AAR) today reported mixed weekly rail traffic for the week ending [...]
Bearish sentiment spiked to its highest level since August 2011, as bullish sentiment fell in the latest AAII Sentiment Survey.