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Investors pile back to risks that fear father away



Bullish investors have emerged from their sleep in 2018. Cash returns to the most risky corners of the market.

"The market oversold huge in December," said David Kelly, chief global strategist at JPMorgan Funds. "The things that fell the most were those that are likely to increase the most."

Hence the talk-back rally for crude oil, which crashed into a bear market last year. US oil prices have increased 22% so far in 2019.
Ditto for GE ( GE ) who died 56% last year. GE is up 34% so far in 2019. That would be the best stock in Dow ̵
1; if it hadn't been kicked out last summer. Other major 2018 losers such as Zions Bank [] Mills ( GIS ) are in two digits this year.
The market for unwanted bonds stopped in December. Exactly zero US high-capital bonds are issued for the first time since the financial crisis. Unclassified sales remain slow, but the market has stabilized. ] has stepped back to full-time heights.

Fed green light HYG ) 19659012] "Fear of a credit event" in December "caused Fed surrender", Michael Hartnett, chief investment strategist at Bank of America Merrill Lynch, wrote to clients at Friday. "It worked."

The Fed's rapid reversal from hawkish to extremely gloomy has served as a green light for investors. The risk store is left on, at least for now.

"We've seen quite a dramatic shift in Fed's monetary policy outlook over the past two months," Kelly said.

Suddenly Dow and S & P 500 are trading at eight-week highs. Both have recovered more than half of their losses.

But some believe Wall Street's euphoria over the Fed policy is misplaced.

"People have to ask themselves: Why does the Fed stop?" said Peter Boockvar, investment manager at Bleakley Advisory Group. "It's not because they met their goals, that's because the data and markets have frightened them."

If Fed's fears are going to be fulfilled, it can be a serious downturn. That would be bad for stocks. If the Fed is too cautious, it may have to aggressively increase interest rates to capture inflation.

"Anyway, I wonder how much more up there is for stocks," Boockvar said.

JPMorgan's Kelly does not buy the recession net. He pointed to the bad Fed and little sign of bubbles in the economy.

"People don't pay enough attention to the possibility that this extension could continue for quite a few years," he said.

2. Sears fate: This week can determine if Sears survives. A US bankruptcy court will hold a Monday hearing on the Sears' plan to sell its assets to its manager, Eddie Lampert, who wants to obtain the 133-year-old company in business.

The hearing will probably unfold during the week. Sears hopes to have a decision approving the sale by Friday.

3. Media Revenue: Boats Disney DIS and 21st Century Fox ( FOXA ]] this week. Disney is on track to complete the acquisition of most of Fox before June, the company said in recent times a government filing. Disney will also be ready this year for the launch of the new streaming service, which is expected to talk more about on an investor day in April.
Fox is preparing for his own reinvention as a smaller, slimmer media company. New York Times ( NYT ) and News Corp ( NWS ) which owns the Wall Street Journal and other publications , reports also report this week.

4. Goo gle does not fall: In the last three months of 2018, the gas group's grills at Congress were protected data security, its employees around the world went beyond sexual harassment scandals and revealed a security issue that affects the largely forgotten social network, Google Plus.

But it doesn't seem to slow Google's business. Alphabet ( GOOGL ) Google's parent company, is expected to announce 20% annual sales this year, when reporting quarterly results after Monday, driven by the continued strength of its advertising sales business.

5. Gene ral Motors reports revenue : General Motors will report financial results Wednesday. It is the company's first quarterly report since it announced plans to cut 8,000 profitable staff and close five factories in North America.

Analysts assume lower earnings for the quarter and year. But the downsides are not an answer to financial distress. Instead, GM says it will trim costs and release funds to invest in electric and self-propelled cars. Analysts will be looking for more details on investment plans when results are released.

6. Coming this week:

Monday Alphabet and Ryanair ( RYAAY ) report income; Mainland China markets closed all week
Tuesday – Union state address; Disney, 21st Century Fox, Snap ( SNAP ) and Electronic Arts ( EA ) GM ) Chipotle ( CMG ) Toyota ) Humana ( HUM ) Eli Lilly ( LLY ) The New York Times and Spotify ( SPOT ) reports income; Cayman Alternative Investment Summit Begins
Thursday – Twitter ( TWTR ) Yum! Kellogg ( K ) Philip Morris International ( ) [19659000] ()

( MET ) [19659045] Mattel ] and Dunkin Brands ] ) ) Phillips 66 (19459008) PSX ) report revenue

CNN Business & # 39; Seth Fiegerman and Chris Isidore contributed to this report.


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