The day’s top news stories from stocks on the GuerillaStockTrading watch list.
Continue reading “Top News Stories For November 13 2017”
The sell-off in technology is more about market reversion to the mean than it is indicative of some gloom and doom scenario where technology stocks lead the rest of the market lower.
Credit Suisse just released a report to clients where they are neutral to slightly cautious on technology stocks for the next 3 months, but remain positive longer out.
There are many bottoms-up drivers in the technology sector right now including the new iPhone, continued increase in cloud usage, greater adoption of artificial intelligence across various sectors, and autonomous driving. Technology adoption and market penetration are likely to increase over the next couple of years.
The S&P 500 is dominated by a few big tech companies. Innovations such as more automation in the grocery industry from Amazon, the iPhone 8, and Tesla’s Model 3 are catalysts for the S&P 500 to move even higher.
Reversion To The Mean
The green line is what I would calculate the mean to be at. As you can see, QQQ has overshot the mean over the last few months and so a move back towards the 10 year mean line is normal.
Fiscal policy will also be a catalyst for continued growth such as tax reform. The medical device tax, investment tax, tanning tax, Medicare Hospital Insurance surtax, the health insurance fee and tax on brand pharmaceutical manufacturers, all will likely be repealed at some point in the future.
Credit Suisse set negative expectations for consumer goods. Stocks that trade in the consumer goods sector are likely going to be stocks we should avoid. Fundamentals and valuation are likely to continue to deteriorate in clothing, department stores, grocery, and packaged food.
If Congress goes on their one-month vacation in August without coming to a deal on the United States public debt, I think the stock market goes into a downward correction. We may not even need to wait that long. Congress has about 6 weeks to come together and reach a deal to raise the debt ceiling.
United States Public Debt Scam
What Democrats did was to run up the national debt so high, that austerity would be forced on the next administration which would all but assure that person a one-term President. We know this because Democrats admit asking Yellen to keep interest rates low and to not raise them until after the election.
Credit Suisse said that they think markets may well be able to continue without too much consternation through most of July, but if it becomes apparent that Congress will head out on its August recess – which lasts the entirety of that month-having made no progress, then fears of a delayed or missed payment should start to build.
Why is Congress going on a one-month vacation before raising the debt ceiling? You don’t use the debt ceiling to enforce austerity. That’s like using Accounts Payable to control spending costs.
Overnight Analyst Actions:
Overnight Headlines By Ticker:
PLX Protalix Biotherapeutics Inc
12/27 07:30 Receives confirmation of order for over $24M of alfataliglicerase to treat gaucher patients in Brazil
PTLA Portola Pharmaceuticals
12/27 07:49 Price Target raised to $29 from $20 at Credit Suisse, reiterates Neutral rating
SGEN Seattle Genetics
12/27 08:00 Announces clinical hold on several Phase 1 trials of Vadastuximab Talirine after deaths [SELL NO LONGER COVERING]
12/27 07:55 Trading halted; news pending; to resume trading at 08:30ET