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Global bond rout: complacency could hit your wealth

By George Prior

Investors need to pay attention to the dramatic global bond market rout to safeguard their wealth despite the sell-off stablising, warns the CEO and founder of one of the world’s largest independent financial advisory organizations.

The warning from deVere Group’s Nigel Green comes as the US, European, and Japanese bond rout deepens.

US bonds maturing in 10 years or more have fallen 46% since peaking in March 2020, according to Bloomberg.

European bonds are following in the footsteps of the US rout, with yields on Germany’s 10-year debt rising above 3% for the first time since 2011, earlier this week. Meanwhile, Japan’s 10-year yield, rose to a decade high, despite the Bank of Japan being prepared to buy $4.5 billion worth of bonds.

Also surging this week have been Australian, Canadian and British government bond yields.

Nigel Green says: “The sell-off began after the US Federal Reserve insisted that interest rates would be kept higher for longer.

“Investors need to be ‘on it’ when it comes to the global bond market rout as it could have far-reaching consequences, impacting various asset classes and investment portfolios, despite the situation having stabilised somewhat for the time being.”

He continues: “Diversification is a cornerstone of a sound investment strategy. However, bond market turbulence can challenge this diversification by affecting both the bond and equity parts of a portfolio.

“When bond prices fall and yields rise, investors can experience losses in their fixed-income holdings.

“At the same time, the shift in investor preferences towards higher-yielding bonds can influence stock markets, potentially leading to equity market declines.

“As such, the bond market’s trajectory may require investors to adjust their asset allocation to mitigate potential losses.”

Many investors turn to bonds for stability and income generation. However, during a bond market rout, even traditionally safe investments, such as government and corporate bonds, can face significant price declines.

“Investors who rely on these bonds for capital preservation and regular income should closely monitor their bond holdings with their financial advisor and perhaps consider diversifying into other assets, such as dividend-paying stocks or alternative investments,” observes the deVere CEO.

Some alternative investments to consider could include precious metal; real assets, such as real estate and infrastructure investments; commodities like oil, natural gas, or agricultural products, and Structured products, such as structured notes which can be customised to offer capital protection or enhanced returns based on specific market conditions.

“To grow and protect their money, I would urge investors to avoid complacency over the global bond rout as we doubt this is the end to the turbulence,” concludes the deVere Group CEO.

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients. It has a network of offices across the world, over 80,000 clients and $12bn under advisement.

Opinions Stock Market News

04 Oct

Investing: What You Can Learn from Mom and Pop

“The highest commitment to stocks since the record levels of early 2000”

By Elliott Wave International

We all love Mom and Pop and cherish the valuable lessons about life they’ve given us along the way.

Yet, when it comes to investing, Mom and Pop may need to learn some lessons of their own.

Keep in mind that the American Association of Individual Investors’ (AAII) weekly survey is said to be representative of “Mom and Pop” investors, well-known for being quite cautious.

The August 2021 Elliott Wave Financial Forecast, a publication which provides analysis of major U.S. financial markets, discussed their behavior as the stock market was staging a significant rally:

In July [2021], the five-month average AAII stock allocation increased to 70.6%, a high level for this normally skittish cohort of investors. … This is the highest commitment to stocks since the record levels of early 2000.

This sentiment indicator is not meant for precision market timing, and, indeed, it seemed like these normally cautious investors had made the right decision. The rally persisted for the remainder of 2021. But, by early January 2022, the Dow Industrials and S&P 500 hit their all-time highs and have traded lower since.

What does this have to do with today?

Here’s an interesting chart and commentary from the August 2023 Elliott Wave Financial Forecast:

This chart shows a jump in the AAII bullish percentage to 59.5% on July 21. … These mom-and-pop investors are traditionally cautious, so big moves and extreme readings generally reflect important capitulations.

Let me emphasize again that sentiment indicators are important yet you may not want to use them for market timing.

That said, when you combine time-tested sentiment indicators with Elliott wave analysis, you get a much clearer picture.

If you’re unfamiliar with Elliott wave analysis, read Frost & Prechter’s Wall Street classic, Elliott Wave Principle: Key to Market Behavior. Here’s a quote from the book:

When after a while the apparent jumble gels into a clear picture, the probability that a turning point is at hand can suddenly and excitingly rise to nearly 100%. It is a thrilling experience to pinpoint a turn, and the Wave Principle is the only approach that can occasionally provide the opportunity to do so.

Our friends at Elliott Wave International are sharing with you a special free report ($80 value).

Using 5 must-see charts, “Are Bulls Headed for a Rude Awakening? 5 Market Warning Signs — Revealed” focuses your readers’ attention on 5 key sentiment areas:

Foreign stock buyers’ behavior: a red flag
See what the crowd’s attitude towards tech stocks shows
Tech stocks vs broad equities: What’s the message here?
Corporate insiders — are they buying or selling?
Artificial intelligence: See what previous technology fevers signaled

Read “5 Market Warning Signs — Revealed” now, FREE ($80 value) >>

P.S. From the inverted U.S. Treasury yield curve to the second-largest U.S. bank failure in history (care of the March Silicon Valley bank collapse) — 2023 has been a year of eerie callbacks to the 2008 financial crisis. See what the rest of the year is likely to bring via our special report >>

This article was syndicated by Elliott Wave International and was originally published under the headline Investing: What You Can Learn from Mom and Pop. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Financial News Stock Market News

30 Sep

COT Stock Market Charts: Speculator Bets led by S&P500-Mini & MSCI EAFE-Mini

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday September 26th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by S&P500-Mini & MSCI EAFE-Mini

The COT stock markets speculator bets were lower this week as three out of the seven stock markets we cover had higher positioning while the other four markets had lower speculator contracts.

Leading the gains for the stock markets was the S&P500-Mini (49,710 contracts) with the MSCI EAFE-Mini (4,923 contracts) and the Russell-Mini (1,959 contracts) also showing positive weeks.

The markets with the declines in speculator bets this week were the VIX (-24,019 contracts) with the DowJones-Mini (-3,849 contracts), the Nasdaq-Mini (-2,348 contracts) and the Nikkei 225 (-196 contracts) also registering lower bets on the week.

Data Snapshot of Stock Market Traders | Columns Legend

Sep-26-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
S&P500-Mini	2,137,648	15	-89,281	51	65,622	49	23,659	47
Nikkei 225	15,483	15	-610	62	-1,200	29	1,810	51
Nasdaq-Mini	241,018	29	846	66	-992	36	146	66
DowJones-Mini	92,551	51	-21,618	13	19,472	73	2,146	54
VIX	384,930	64	-52,835	80	58,631	19	-5,796	66
Nikkei 225 Yen	53,690	42	10,779	67	7,032	30	-17,811	49

Strength Scores led by VIX & Nasdaq-Mini

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that the VIX (80 percent) currently leads the stock markets this week and is in Extreme-Bullish territory (above 80 percent). The Nasdaq-Mini (66 percent) and Nikkei 225 (62 percent) come in as the next highest in the weekly strength scores.

On the downside, the DowJones-Mini (13 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent). The next lowest strength score is the MSCI EAFE-Mini (32 percent).

Strength Statistics:
VIX (80.4 percent) vs VIX previous week (97.9 percent)
S&P500-Mini (51.4 percent) vs S&P500-Mini previous week (44.0 percent)
DowJones-Mini (12.7 percent) vs DowJones-Mini previous week (23.6 percent)
Nasdaq-Mini (66.2 percent) vs Nasdaq-Mini previous week (68.2 percent)
Russell2000-Mini (35.0 percent) vs Russell2000-Mini previous week (33.8 percent)
Nikkei USD (62.4 percent) vs Nikkei USD previous week (63.8 percent)
EAFE-Mini (31.7 percent) vs EAFE-Mini previous week (27.0 percent)

Russell-Mini tops the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the Russell-Mini (6 percent) leads the past six weeks trends for the stock markets. The S&P500-Mini (4 percent) and the Nikkei 225 (1 percent) are the next highest positive movers in the latest trends data.

The DowJones-Mini (-52 percent) leads the downside trend scores currently with the VIX (-20 percent) coming in as the next market with lower trend scores.

Strength Trend Statistics:
VIX (-19.6 percent) vs VIX previous week (11.4 percent)
S&P500-Mini (4.3 percent) vs S&P500-Mini previous week (3.1 percent)
DowJones-Mini (-52.1 percent) vs DowJones-Mini previous week (-61.7 percent)
Nasdaq-Mini (-3.8 percent) vs Nasdaq-Mini previous week (12.3 percent)
Russell2000-Mini (5.8 percent) vs Russell2000-Mini previous week (0.6 percent)
Nikkei USD (0.6 percent) vs Nikkei USD previous week (1.8 percent)
EAFE-Mini (-1.8 percent) vs EAFE-Mini previous week (-7.1 percent)

Individual Stock Market Charts:

VIX Volatility Futures:

The VIX Volatility large speculator standing this week reached a net position of -52,835 contracts in the data reported through Tuesday. This was a weekly lowering of -24,019 contracts from the previous week which had a total of -28,816 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 80.4 percent. The commercials are Bearish-Extreme with a score of 19.3 percent and the small traders (not shown in chart) are Bullish with a score of 66.4 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

VIX Volatility Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	22.4	47.2	6.4
– Percent of Open Interest Shorts:	36.2	32.0	7.9
– Net Position:	-52,835	58,631	-5,796
– Gross Longs:	86,408	181,651	24,727
– Gross Shorts:	139,243	123,020	30,523
– Long to Short Ratio:	0.6 to 1	1.5 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	80.4	19.3	66.4
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-19.6	19.2	-0.9

S&P500 Mini Futures:

The S&P500 Mini large speculator standing this week reached a net position of -89,281 contracts in the data reported through Tuesday. This was a weekly lift of 49,710 contracts from the previous week which had a total of -138,991 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 51.4 percent. The commercials are Bearish with a score of 49.0 percent and the small traders (not shown in chart) are Bearish with a score of 46.6 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

S&P500 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	12.4	73.0	11.8
– Percent of Open Interest Shorts:	16.6	69.9	10.7
– Net Position:	-89,281	65,622	23,659
– Gross Longs:	266,095	1,560,014	251,580
– Gross Shorts:	355,376	1,494,392	227,921
– Long to Short Ratio:	0.7 to 1	1.0 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	51.4	49.0	46.6
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	4.3	-4.2	0.6

Dow Jones Mini Futures:

The Dow Jones Mini large speculator standing this week reached a net position of -21,618 contracts in the data reported through Tuesday. This was a weekly lowering of -3,849 contracts from the previous week which had a total of -17,769 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 12.7 percent. The commercials are Bullish with a score of 73.3 percent and the small traders (not shown in chart) are Bullish with a score of 54.4 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Dow Jones Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	19.7	62.3	15.7
– Percent of Open Interest Shorts:	43.1	41.3	13.4
– Net Position:	-21,618	19,472	2,146
– Gross Longs:	18,237	57,681	14,570
– Gross Shorts:	39,855	38,209	12,424
– Long to Short Ratio:	0.5 to 1	1.5 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	12.7	73.3	54.4
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-52.1	33.7	8.8

Nasdaq Mini Futures:

The Nasdaq Mini large speculator standing this week reached a net position of 846 contracts in the data reported through Tuesday. This was a weekly decline of -2,348 contracts from the previous week which had a total of 3,194 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 66.2 percent. The commercials are Bearish with a score of 35.8 percent and the small traders (not shown in chart) are Bullish with a score of 66.0 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Nasdaq Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	24.2	58.2	16.6
– Percent of Open Interest Shorts:	23.8	58.6	16.5
– Net Position:	846	-992	146
– Gross Longs:	58,307	140,156	39,946
– Gross Shorts:	57,461	141,148	39,800
– Long to Short Ratio:	1.0 to 1	1.0 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	66.2	35.8	66.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-3.8	3.9	1.4

Russell 2000 Mini Futures:

The Russell 2000 Mini large speculator standing this week reached a net position of -61,602 contracts in the data reported through Tuesday. This was a weekly rise of 1,959 contracts from the previous week which had a total of -63,561 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 35.0 percent. The commercials are Bullish with a score of 63.8 percent and the small traders (not shown in chart) are Bearish with a score of 33.8 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Russell 2000 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	7.7	85.2	5.4
– Percent of Open Interest Shorts:	21.0	72.4	4.9
– Net Position:	-61,602	59,276	2,326
– Gross Longs:	35,566	393,907	24,965
– Gross Shorts:	97,168	334,631	22,639
– Long to Short Ratio:	0.4 to 1	1.2 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	35.0	63.8	33.8
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	5.8	-4.8	-3.5

Nikkei Stock Average (USD) Futures:

The Nikkei Stock Average (USD) large speculator standing this week reached a net position of -610 contracts in the data reported through Tuesday. This was a weekly reduction of -196 contracts from the previous week which had a total of -414 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 62.4 percent. The commercials are Bearish with a score of 28.6 percent and the small traders (not shown in chart) are Bullish with a score of 51.1 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Nikkei Stock Average Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	8.6	67.1	24.4
– Percent of Open Interest Shorts:	12.5	74.8	12.7
– Net Position:	-610	-1,200	1,810
– Gross Longs:	1,325	10,385	3,773
– Gross Shorts:	1,935	11,585	1,963
– Long to Short Ratio:	0.7 to 1	0.9 to 1	1.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	62.4	28.6	51.1
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	0.6	-3.7	6.5

MSCI EAFE Mini Futures:

The MSCI EAFE Mini large speculator standing this week reached a net position of -25,328 contracts in the data reported through Tuesday. This was a weekly gain of 4,923 contracts from the previous week which had a total of -30,251 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 31.7 percent. The commercials are Bullish with a score of 69.6 percent and the small traders (not shown in chart) are Bearish with a score of 29.5 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

MSCI EAFE Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	7.5	89.4	2.2
– Percent of Open Interest Shorts:	14.1	83.5	1.6
– Net Position:	-25,328	22,834	2,494
– Gross Longs:	29,019	344,909	8,675
– Gross Shorts:	54,347	322,075	6,181
– Long to Short Ratio:	0.5 to 1	1.1 to 1	1.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	31.7	69.6	29.5
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-1.8	5.8	-20.7

Article By InvestMacro – Receive our weekly COT Newsletter

See our Weekly Trend Model Readings and Actions for each COT Futures Market and Category. All information contained in this data are for general informational purposes only and do not constitute investment advice.

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

COT Updates Financial News Stock Market News

27 Sep

Union and execs need to shift gears fast once UAW strike is over – transition to EV manufacturing requires their teamwork

By Peter Berg, Michigan State University

The United Auto Workers union is ramping up its strike against General Motors and Stellantis – the global company that makes Chrysler, Jeep and Dodge vehicles – and getting closer to a deal with Ford.

About 5,600 UAW members at 38 General Motors and Stellantis distribution centers for auto parts in 20 states walked off the job on Sept. 22, 2023, after an announcement by UAW President Shawn Fain.

Workers at the only Ford plant affected by the strike since it began on Sept. 15 will remain off the job. The total number of UAW members involved in the strike stands at about 18,300.

Under Fain’s leadership, the union is taking an adversarial approach: It’s railing against what it describes as the “poverty wages” UAW members earn while denouncing the automakers’ CEOs as “greedy” and vowing to “wreck their economy.”

As a scholar of employment relations, I think this strike is too narrowly focused on making up for the wages and benefits autoworkers have lost in recent years. But another big objective is ensuring that autoworkers will have good jobs once most U.S.-made vehicles are electric-powered.

This dispute alone will not resolve this larger objective. Rather, I believe management and labor will need to swiftly move on following the strike and work together constructively to meet that goal.

UAW’s demands

The union is demanding an end to the concessions it made to the three companies during the financial crisis that began in 2007. Its members employed by Ford, GM and Stellantis have experienced a 19% decline in their wages, after accounting for inflation, since 2008.

The union also wants the automakers – sometimes called the Detroit Three – to abolish the tiered wage system, which pays new employees far less than more experienced workers, even for the same work. The UAW initially said it was seeking a wage increase of 40% over four years and the restoration of a cost-of-living allowance that would link wages to inflation.

In addition to these demands, the UAW wants defined-benefit pensions for all workers restored, company-paid health benefits for retirees reestablished and the right to strike over plant closures guaranteed. Other demands include more paid time off and seeing all temporary workers made permanent. It has also called for a 32-hour work week without a pay cut.

Precedents for working together

Although the strike has emphasized the goal of boosting future autoworker pay and benefits, I believe that workers and management can look to the past for ideas that might help them move forward.

GM’s Saturn partnership offers one potential model.

The company’s approach to its Saturn brand of compact vehicles, launched in 1985, was unique in many respects. Its governance structure was characterized by shared decision-making at different levels throughout the plant. The local union was a full partner in virtually all business decisions.

GM invested billions of dollars in this venture, through which it tried to compete with Japanese imports and transplants that were quickly eroding GM’s market share. Saturns were designed differently than other U.S. vehicles, but what made those vehicles special was the extent to which labor shared the responsibility for running Saturn’s main factory.

The Saturn partnership was hard to maintain, especially following the departure of Roger B. Smith, the General Motors CEO who had pushed hard for it. The company stopped making Saturns in 2009, but the former subsidiary’s overall approach of involving workers in decisions about their jobs and the manufacturing process remains as critical today as it was in its heyday.

I would encourage the auto industry to again invoke the spirit of the Saturn venture, which emphasized the collaboration and partnership of labor and management in the production of high-quality, world-class vehicles. Only this time, the vehicles will be EVs.

GM offers another model for positive union-management relations.

About 20 years ago, its Lansing-Grand River assembly plant in Michigan began to engage in a similar example of what I call joint responsibility unionism. Management and the local UAW union established a contractual commitment to work together to continually improve production by systematically solving problems and increasing productivity.

Management and the local UAW union established a contractual commitment to work together to continually improve production by systematically solving problems and increasing productivity.

The local union and management hold each other accountable for keeping costs down and quality high. The plant, which assembles Cadillacs and Chevy Camaros, continues this approach successfully today.

Shift the focus to the future

The UAW is pointing to the billions of dollars in profits auto companies are currently getting when it demands a bigger piece of the pie. The companies counter that rapidly increasing EV production is costly.

GM, Ford and Stellantis already plan to invest more than US$100 billion in electric vehicle manufacturing. As production shifts away from vehicles with internal combustion engines that burn gasoline or diesel fuel, the number of autoworkers needed to build them will decline. EVs have fewer parts.

Ford and Volkswagen, for example, have estimated that they’ll eventually need 30% less labor due to the EV transition.

Undergoing this transformation with labor and management at loggerheads can’t possibly benefit the UAW or the auto companies.

Instead, they’ll need to focus on finding solutions together that increase productivity, build a skilled workforce and efficiently convert plants that make conventional vehicles today to EV factories tomorrow. In so doing, the UAW is more likely to meet its goal of seeing those EV factories employ its members.

About the Author:

Peter Berg, Professor of Employment Relations; Director of Human Resources and Labor Relations, Michigan State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Financial News Stock Market News

27 Sep

Mid-Week Technical Outlook: Indices

By ForexTime

Some semblance of stability returned to global equity markets on Wednesday as rate hike fears cooled after a sharp selloff in the previous session.

European stocks edged higher in tight ranges while US futures are pointing to a mixed open amid the cautious market mood. In the currency arena, the dollar continues to dominate with the USD Index trading at levels not seen since November 2022. Looking at commodities, oil prices surged this morning while gold extended losses thanks to rising Treasury yields and a stronger dollar.

Our attention today falls on major indices which seem to be under the mercy of rate hike fears.

SPX500_m could test 200-day SMA

The bearish case for the SPX500_m was reinforced after prices secured a solid daily close below the 4332 levels.

There have been consistently lower lows and lower highs while the MACD trades below zero. Bears are clearly in a position of power with a breakdown below 4270, opening a path towards the 200-day SMA at 4210. For bulls to jump back into the game, a move back 4332 needs to be achieved.

NQ100_m breaks key daily support

The recent breakdown below the 14670 support level may signal further downside for the NQ100_m with 14250 acting as a key level of interest.

Technical forces favour bears, as there have been consistently lower lows and lower highs while prices are trading below the 50 and 100-day SMA. Should prices push back above 14670, this could trigger a rebound towards the 100-day SMA before the downside resumes.

STOX50_m wobbles above 4100

It is safe to say that STOX50_m bears remain in some position of power below the 4200 resistance level.

Prices are approaching another support at 4100, a level not seen since March 2022. A solid breakdown below this level could trigger a selloff towards 4060. Should 4100 prove to be reliable support, prices may push back towards 4200.

UK100_m trapped in wide range

It remains a choppy affair for the UK100_m which is currently trapped within a very wide range on the daily charts.

Resistance can be found at 7710 and support at 7250. Despite the choppiness, prices could be gearing up to decline given the recent break below the 200-day SMA. A strong daily close under 7605 may spark a selloff towards 7530 – where the 50-day SMA resides. If bulls can fight back, a bounce towards 7710 could be on the cards.

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Opinions Stock Market News

26 Sep

Cycle of rate hikes is over – are your investments aligned?

By George Prior

Investors need now to ensure their investment portfolios are ready for “a new era” as central banks become seemingly convinced that no further interest rate rises will be needed in this monetary cycle.

This assessment from Nigel Green of deVere Group, one of the world’s largest independent financial advisory, asset management and fintech organizations, comes as policymakers in the US, UK, Japan and Switzerland all decided to keep rates steady last week.

He comments: “We’re in a transition period ahead of a new monetary era as most of the world’s most influential central banks are now anticipated to cut interest rates in the next quarter of 2024, rather than raise them.

“This is because we’re heading into a stage of lower growth and lower inflation.”

With central banks, it appears, having reached a consensus that no further interest rate hikes are likely to be needed, investors must recalibrate their strategies.

Diversification remains a foundational strategy in managing investment risk. Investors should consider allocating their assets across various classes, including equities, fixed income, real estate, and alternatives.

Amid economic deceleration, it’s prudent to emphasize defensive stocks in your portfolio.

“These are companies that tend to exhibit resilience during downturns due to the essential nature of their products or services. Sectors like healthcare, utilities, and consumer staples often fall into this category. Companies in these sectors can continue to generate revenue even when consumer spending weakens,” says the deVere CEO.

“While economic growth may slow, technological advancements and innovation continue to shape the future. Investing in companies at the forefront of technology and innovation can be a smart move. This includes sectors like tech, biotech, and green energy, which may experience sustained growth as society seeks solutions to pressing global challenges.”

He goes on to add: “Also, consider investments with a fixed income component to match your risk tolerance and income needs.”

In addition, emerging markets, notes Nigel Green, can present attractive opportunities during periods of global economic slowdown. These markets often exhibit higher growth potential compared to mature economies. “However, they also come with higher volatility and risks, so thorough research and a long-term investment horizon are essential.”

Navigating the complexities of investing during economic slowdowns requires careful planning and expertise. Seeking advice from a financial advisor can provide you with a tailored investment strategy based on your unique financial goals, risk tolerance, and time horizon.

“The world is about to shift into a new era and your investments should be aligned accordingly if you’re serious about creating, growing and safeguarding your money,” says Nigel Green.

About:

Opinions Stock Market News

17 Sep

COT Stock Market Charts: Weekly Speculator Bets led by S&P500-Mini & Russell-Mini

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday September 12th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by S&P500-Mini & Russell-Mini

The COT stock markets speculator bets were higher this week as four out of the seven stock markets we cover had higher positioning while the other four markets had lower speculator contracts.

Leading the gains for the stock markets was the S&P500-Mini (27,878 contracts) with the Russell-Mini (8,096 contracts), the Nikkei 225 (656 contracts) and the VIX (3,384 contracts) also showing positive weeks.

The markets with the declines in speculator bets this week were the MSCI EAFE-Mini (-20,113 contracts) with the Nasdaq-Mini (-4,494 contracts) and the DowJones-Mini (-1,176 contracts) also registering lower bets on the week.

Data Snapshot of Stock Market Traders | Columns Legend

Sep-12-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
S&P500-Mini	2,520,164	48	-116,333	47	87,045	52	29,288	49
Nikkei 225	16,425	17	514	72	-918	30	404	33
Nasdaq-Mini	303,321	77	9,056	82	-9,508	17	452	66
DowJones-Mini	102,910	69	-12,900	37	12,437	59	463	46
VIX	418,072	81	-39,342	90	40,099	6	-757	92
Nikkei 225 Yen	46,463	29	3,889	46	6,646	29	-10,535	73

Strength Scores led by VIX & Nasdaq-Mini

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that the VIX (90 percent) and the Nasdaq-Mini (82 percent) lead the stock markets this week. The Nikkei 225 (72 percent) and S&P500-Mini (47 percent) come in as the next highest in the weekly strength scores.

On the downside, the MSCI EAFE-Mini (0 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent). The next lowest strength score is the Russell-Mini (34 percent).

Strength Statistics:
VIX (90.3 percent) vs VIX previous week (87.8 percent)
S&P500-Mini (47.4 percent) vs S&P500-Mini previous week (43.2 percent)
DowJones-Mini (37.4 percent) vs DowJones-Mini previous week (40.7 percent)
Nasdaq-Mini (82.4 percent) vs Nasdaq-Mini previous week (85.0 percent)
Russell2000-Mini (33.8 percent) vs Russell2000-Mini previous week (28.9 percent)
Nikkei USD (72.4 percent) vs Nikkei USD previous week (68.2 percent)
EAFE-Mini (0.0 percent) vs EAFE-Mini previous week (19.4 percent)

S&P500-Mini & Nasdaq-Mini top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the S&P500-Mini (13 percent) leads the past six weeks trends for the stock markets. The Nasdaq-Mini (12 percent), the Nikkei 225 (9 percent) and the VIX (2 percent) are the next highest positive movers in the latest trends data.

The DowJones-Mini (-41 percent) leads the downside trend scores currently with the MSCI EAFE-Mini (-33 percent) coming in as the next market with lower trend scores.

Strength Trend Statistics:
VIX (2.1 percent) vs VIX previous week (-0.4 percent)
S&P500-Mini (12.5 percent) vs S&P500-Mini previous week (13.2 percent)
DowJones-Mini (-41.0 percent) vs DowJones-Mini previous week (-37.2 percent)
Nasdaq-Mini (11.8 percent) vs Nasdaq-Mini previous week (13.9 percent)
Russell2000-Mini (1.6 percent) vs Russell2000-Mini previous week (-1.8 percent)
Nikkei USD (8.9 percent) vs Nikkei USD previous week (16.0 percent)
EAFE-Mini (-32.8 percent) vs EAFE-Mini previous week (-6.9 percent)

Individual Stock Market Charts:

VIX Volatility Futures:

The VIX Volatility large speculator standing this week equaled a net position of -39,342 contracts in the data reported through Tuesday. This was a weekly boost of 3,384 contracts from the previous week which had a total of -42,726 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 90.3 percent. The commercials are Bearish-Extreme with a score of 6.2 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 91.9 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

VIX Volatility Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	24.9	46.0	6.5
– Percent of Open Interest Shorts:	34.3	36.4	6.7
– Net Position:	-39,342	40,099	-757
– Gross Longs:	104,179	192,419	27,224
– Gross Shorts:	143,521	152,320	27,981
– Long to Short Ratio:	0.7 to 1	1.3 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	90.3	6.2	91.9
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	2.1	-3.0	6.8

S&P500 Mini Futures:

The S&P500 Mini large speculator standing this week equaled a net position of -116,333 contracts in the data reported through Tuesday. This was a weekly increase of 27,878 contracts from the previous week which had a total of -144,211 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 47.4 percent. The commercials are Bullish with a score of 51.9 percent and the small traders (not shown in chart) are Bearish with a score of 48.9 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

S&P500 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	11.1	72.3	11.4
– Percent of Open Interest Shorts:	15.7	68.8	10.2
– Net Position:	-116,333	87,045	29,288
– Gross Longs:	279,471	1,821,412	286,894
– Gross Shorts:	395,804	1,734,367	257,606
– Long to Short Ratio:	0.7 to 1	1.1 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	47.4	51.9	48.9
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	12.5	-13.6	5.8

Dow Jones Mini Futures:

The Dow Jones Mini large speculator standing this week equaled a net position of -12,900 contracts in the data reported through Tuesday. This was a weekly fall of -1,176 contracts from the previous week which had a total of -11,724 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 37.4 percent. The commercials are Bullish with a score of 59.1 percent and the small traders (not shown in chart) are Bearish with a score of 46.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Dow Jones Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	22.1	58.9	14.2
– Percent of Open Interest Shorts:	34.7	46.8	13.7
– Net Position:	-12,900	12,437	463
– Gross Longs:	22,788	60,631	14,578
– Gross Shorts:	35,688	48,194	14,115
– Long to Short Ratio:	0.6 to 1	1.3 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	37.4	59.1	46.1
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-41.0	28.2	2.9

Nasdaq Mini Futures:

The Nasdaq Mini large speculator standing this week equaled a net position of 9,056 contracts in the data reported through Tuesday. This was a weekly decline of -4,494 contracts from the previous week which had a total of 13,550 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 82.4 percent. The commercials are Bearish-Extreme with a score of 16.5 percent and the small traders (not shown in chart) are Bullish with a score of 66.2 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Nasdaq Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	22.6	56.6	14.8
– Percent of Open Interest Shorts:	19.7	59.7	14.7
– Net Position:	9,056	-9,508	452
– Gross Longs:	68,674	171,570	44,891
– Gross Shorts:	59,618	181,078	44,439
– Long to Short Ratio:	1.2 to 1	0.9 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	82.4	16.5	66.2
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	11.8	-13.8	2.1

Russell 2000 Mini Futures:

The Russell 2000 Mini large speculator standing this week equaled a net position of -63,615 contracts in the data reported through Tuesday. This was a weekly rise of 8,096 contracts from the previous week which had a total of -71,711 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 33.8 percent. The commercials are Bullish with a score of 63.7 percent and the small traders (not shown in chart) are Bearish with a score of 40.7 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Russell 2000 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	8.7	81.9	5.8
– Percent of Open Interest Shorts:	20.5	71.0	4.9
– Net Position:	-63,615	59,033	4,582
– Gross Longs:	47,088	443,198	31,308
– Gross Shorts:	110,703	384,165	26,726
– Long to Short Ratio:	0.4 to 1	1.2 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	33.8	63.7	40.7
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	1.6	-1.8	1.8

Nikkei Stock Average (USD) Futures:

The Nikkei Stock Average (USD) large speculator standing this week equaled a net position of 514 contracts in the data reported through Tuesday. This was a weekly rise of 656 contracts from the previous week which had a total of -142 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 72.4 percent. The commercials are Bearish with a score of 30.3 percent and the small traders (not shown in chart) are Bearish with a score of 33.4 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Nikkei Stock Average Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	10.9	68.5	20.6
– Percent of Open Interest Shorts:	7.8	74.1	18.1
– Net Position:	514	-918	404
– Gross Longs:	1,793	11,249	3,383
– Gross Shorts:	1,279	12,167	2,979
– Long to Short Ratio:	1.4 to 1	0.9 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	72.4	30.3	33.4
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	8.9	-3.1	-10.6

MSCI EAFE Mini Futures:

The MSCI EAFE Mini large speculator standing this week equaled a net position of -58,192 contracts in the data reported through Tuesday. This was a weekly lowering of -20,113 contracts from the previous week which had a total of -38,079 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.0 percent. The commercials are Bullish-Extreme with a score of 100.0 percent and the small traders (not shown in chart) are Bearish with a score of 37.9 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

MSCI EAFE Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	4.9	90.3	2.8
– Percent of Open Interest Shorts:	17.6	78.6	1.9
– Net Position:	-58,192	54,008	4,184
– Gross Longs:	22,550	415,412	12,927
– Gross Shorts:	80,742	361,404	8,743
– Long to Short Ratio:	0.3 to 1	1.1 to 1	1.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	0.0	100.0	37.9
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-32.8	35.7	-13.4

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Financial News Stock Market News

14 Sep

Will ECB decision inspire STOX50 bears?

By ForexTime

ECB

STOX50 bears are testing a weekly support level
Momentum and MACD oscillators confirm bearish bias
Four potential targets identified.
Bearish scenario invalidated if 4281.7 level is broken
Will ECB decision trigger a breakout?

European shares crawled higher on Thursday, while the euro entered standby mode as investors braced for the European Central Bank (ECB) rate decision.

Our focus this morning falls on the STOX50 Index which could be influenced by this major risk event!

As discussed in our week ahead report last Friday, the ECB rate decision is expected to be a close call thanks to stubborn inflation and weakening growth. While markets seem to be betting against a hike this afternoon, ECB policymakers have warned that the decision was still up in the air.

The STOX50 may find itself under renewed selling pressure if the ECB raises interest by 25 basis points as growth fears weigh heavily on European shares.
Should the ECB pause on rate hikes in September, this could offer some relief to European stocks – lending some support to the STOX50.

Regarding the technical picture…

The STOX50 index entered a weekly resistance and support level arena on 2 August, that would prove to keep the bulls and the bears in tight hand combat as the market bounced between those levels.

Bears have been testing the weekly support level more intensely during the last week or two and might be getting ready for a breakthrough. If they can break through the weekly support level and cause the price to go lower than the last bottom, an early stage of a new trend will be in process.

For a more exact picture of the possibilities with a defined trigger, stop loss, and target scenario, the FXTM D1 signals chart shows the way.

Both the Momentum as well as the MACD oscillators confirm that the momentum in the STOX50 market has changed to the bearish side and so all that is needed for the bears is to break through the 4180.4 price level to trigger a short opportunity. The stop loss will be behind the last swing at 4281.7 with four very conservative targets that become possible.

Attaching a modified Fibonacci tool to the trigger level at 4180.4 and dragging it to the lower top at 4281.7, the following targets can be established:

• The first target is possible at 4139.9 (Target 1)

• The second price target is likely at 4119.6 (Target 2)

• The third price target is probable at 4079.1 (Target 3)

• The fourth price target might reach 4028.4 (Target 4)

If the price at 4281.7 is broken, this scenario is no longer applicable.

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Stock Market News

12 Sep

“Bear Market Leader”? Here’s a Prime Candidate

This stock market sector has failed to recover since the Dow’s Q1 correction

By Elliott Wave International

As you may know, in every bull or bear market, some stocks or sector lead while others follow. So, the “leadership” in the stock market works both ways — in uptrends and down.

The rally in stocks since last November has been led by a relatively few big cap tech names, like Nvidia, Microsoft, Apple, Alphabet and Meta.

As you may also know, history shows that stocks which lead on the upside often lead on the downside after a market turn occurs. That’s why in our publications we’re keeping a close eye on the tech sector right now.

Another prime candidate as a bear market leader is the banking sector.

Indeed, the August Elliott Wave Theorist, a monthly publication which covers major financial and social trends, shows this chart and says:

Bankers are bullish on investments, but investors are not bullish on banks. Bank stocks turned weak during the Dow’s Q1 correction and have failed to recover with it since. While all the major stock market indexes rose into July-August, bank stocks stayed down on the year.

Besides sinking stock prices, banks are also grappling with an extraordinarily weak commercial real estate market.

As a June headline in The Financial Times noted:

US banks prepare for losses in rush for commercial property exit

As the article notes, some banks plan to sell off property loans at a discount even though borrowers have been making their payments on time. The reason for this is that banks fear more delinquencies in commercial real estate down the road.

U.S. banks hold about $2.9 trillion in commercial real estate loans, which prompted the Wall Street Journal to pose this question in July:

Is the Banking Crisis Over? We Are About to Find Out

As you might imagine, some banks are more vulnerable than others. And Elliott Wave International has emphasized time and again that it’s important for depositors to make sure they do business with only financially sound banks. Because even during a severe economic downturn, some banks will not only survive, but thrive.

As a 2022 Elliott Wave Theorist said:

The first edition of Conquer the Crash noted that depositors would become concerned about bank risks and move their money from weak banks to strong banks, making the weak banks weaker and the strong banks stronger. This is just what happened in 2008-2009.

The next financial crisis may be just around the corner.

Realize that major economic downturns generally follow severe downturns in the stock markets, so it’s important to keep an eye on the Elliott wave structure of the main stock indexes.

If you’re unfamiliar with Elliott wave analysis or simply need a reminder, read the definitive text on the subject, Elliott Wave Principle: Key to Market Behavior, by Frost & Prechter. Here’s a quote from this Wall Street classic:

The primary value of the Wave Principle is that it provides a context for market analysis. This context provides both a basis for disciplined thinking and a perspective on the market’s general position and outlook. At times, its accuracy in identifying, and even anticipating, changes in direction is almost unbelievable.

Know that the online version of this Wall Street classic is available to you free once you sign up for a Club EWI membership. Club EWI is the world’s largest Elliott wave educational community and membership is also free with zero obligations. Members enjoy complimentary access to a wealth of Elliott wave resources on financial markets, trading and investing.

Just follow this link to get started: Elliott Wave Principle: Key to Market Behavior — get free and unlimited access.

This article was syndicated by Elliott Wave International and was originally published under the headline “Bear Market Leader”? Here’s a Prime Candidate. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Financial News Stock Market News

11 Sep

Will iPhone 15 event help Apple recover $200bn lost last week?

By George Prior

Apple’s iPhone 15 event on Tuesday will boost stock prices for shareholders but it will not be enough to recover its stock market valuation which fell by more than 6%, or almost $200bn (£160bn), in two days last week.

This is the prediction from Nigel Green, CEO and founder of deVere Group, one of the world’s largest independent financial advisory, asset management and fintech organizations, who goes on to say that investors will see a dip in the stock price as a buying opportunity.

Stock prices fell after reports that Chinese government workers have been banned from using iPhones.

He comments: “Apple’s new iPhone showcase on Tuesday, dubbed ‘Wonderlust’ is expected to unveil new hardware, including the iPhone 15 and Apple Watch models.

“Apple’s iPhone events typically generate significant buzz and anticipation, leading to a surge in sales. This in turn will boost stock prices for shareholders in the short-term.

“However, we don’t expect it to be enough to recover its full stock market valuation which fell by more than 6%, or almost $200bn in two days last week.”

The deVere Group CEO continues: “This is not because of the issue of Beijing reportedly banning government workers using iPhones. The impact of this move has been greatly exaggerated.

“The drop in stock prices comes at the same time as the release of an important rival phone in China, the Huawei Mate 60.

“It also comes at a time when Apple has had three consecutive quarters of declining sales due to the macroeconomic climate in the market with major headwinds for consumption across the board.

“These should be the main reasons stock prices fell last week, not the knee-jerk reaction to a ban that affects only around 500,000 government employees’ phones.

“And as these real reasons remain in the short term, we believe it will be a struggle for Apple to make up the stock market valuation with Tuesday’s event.”

But, says Nigel Green, the dip in stock price “will be used by savvy investors as a buying opportunity.”

He notes: “The robust fundamentals of the biggest company remain unchanged. It has huge amounts of capital and expertise, dominates the market, and is amazingly adaptable – which is critical.

“This is evidenced by Apple CEO Tim Cook, despite being the head of a major US company, has managed – so far at least – being viewed by Beijing as almost ‘independent’ from the US, which many other major brands haven’t been able to pull off.

“For me personally, Apple remains a ‘buy’.”

He concludes: “We don’t expect the iPhone 15 event on Tuesday to rock the world for Apple shareholders, but global investors will not be ruling the company out – if anything they’ll be using the volatility as an opportunity.”

About:

Financial News Stock Market News

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