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The Best of What They Said and I Read Week Ending 12/30/2019

Short excerpts from articles I found interesting.  I may not agree with the author and the following material is not intended as investment advice

 Barron’s – December 27, 2019 – The Dow Is Closing Out 2019 With a Bang – Ben Levisohn

  • “ …The Dow Jones Industrial Average has risen 23% in 2019 after gaining 190.17 points, or 0.7%, to 28,645.26, this past week, while the S&P 500 index has gained 29% after rising 0.6%, to 3240.02, and the Nasdaq Composite has climbed 36% after finishing the week up 0.9%, at 9006.62. The S&P 500 and the Dow both closed the week at all-time highs.”
  •  “…I don’t know what the stock market will do in 2020. But I have a pretty good suspicion about what it won’t do. Next year won’t be an average one for the S&P 500—that would mean gaining 7.7%, something it has done just once since 1928, in 1966.”
  •  “…Being a reasonable man, I’d like to think that big gains inevitably lead to big losses—gravity and all that—but history suggests otherwise. The S&P 500 has finished higher two-thirds of time after gaining 25% or more in a single year. Simply based on the odds, it would be reasonable to conclude that it’s time to bet on more upside.  Or not. The market is anticipating a lot of good news: The U.S. and China sign a trade deal, which gets companies spending again, helping to boost economic growth in the U.S. and abroad and lifting corporate profits. The Federal Reserve, meanwhile, lets the economy run a little hot, making up for the sluggish growth of the past 10 years. Toss in some government spending and you have explained not only this year’s big gains, but next year’s, as well.”
  •  “All that’s missing is what could go wrong. We have a few things: The trade war between the U.S. and China could heat up again. Europe could become President Donald Trump’s next trade target. Inflation could heat up and cause the Fed to start thinking about raising rates again. And the economic acceleration the market appears to be expecting might simply fail to show up.”

  Bloomberg – December 26, 2019 – Year in Stocks Ending Just Like It Began, in Straight-Up Bliss  – Rita Nazareth and Sarah Ponczek

  • “…The S&P 500 started the year by rising in nine of the first 10 weeks. Now it’s closing it out with gains in 11 out of the past 12, a feat of concerted advances that occurred only once before since 1985. The Nasdaq Composite Index just missed climbing for a 12 straight day, the most in a decade, and, up 12.7%, is on pace for its best fourth quarter since 2004.”
  •  “While a category of Wall Street wags starts panicking when gains come this easy, people who heeded warnings about euphoria after the Nasdaq surged 16.5% in the first quarter missed a 16.7% jump since it ended. Gains don’t always beget losses in the stock market -- ask everyone who has watched the Faang stocks triple after they sold them in 2013.”
  •  “…Stocks ended Friday mixed as traders assessed a rally that’s added more than $5 trillion to equities this year, but the S&P 500 notched a fifth straight weekly advance and the Nasdaq Composite jumped above 9,000 for the first time. Blue-chip companies led the Dow Jones Industrial Average to a record high. The dollar slid against most of its major peers. Treasuries rose. Oil rebounded from Friday’s lows as a government report showed U.S. crude inventories sank.”

 U.S. Global Investors - Investor Alert – December 27, 2019 – Frank Holmes 

  • “…JPMorgan is bullish on 2020 and is advising clients to short gold via the options market, overweight equities and underweight bonds, reports Bloomberg. This is in big contrast to Goldman Sachs, which sees gold soaring next year. JPMorgan sees recession risks subsiding while Goldman sees recession risks arising from the trade war.”
  •  “…As reported by Bloomberg, Apple Inc.’s first batch of 5G-enabled iPhones will “open up the floodgates” on device upgrades, Wedbush Securities Inc. predicted. About 350 million iPhones within the company’s 900 million installed user base are currently in the window of an upgrade opportunity, analyst Dan Ives wrote in a note to clients on Monday. The analyst reiterated his outperform rating, while lifting his price target to $350 a share from $325.”

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