MARKETS TODAY Nov 9 (Vica Partners) – The S&P 500 down – 0.42% as of 10.25 a.m. Eastern. The Dow Jones Industrial Average down 137 points, or – 0.41%, to 33,024. The tech based Nasdaq down -0.58%.
Stocks mostly fall Wednesday morning as the three major stock market indexes negative, the 10-year Treasury yield flat at 4.136%, the 2 year Treasury yield flat at 4.678%, and the U.S. Dollar Index (DXY) up at $110.29, 0.60%. Oil prices down with Brent crude $93.59, -1.86%, and US West Texas Intermediate flat at $87.15, -1.98%.
Data over the past 78 years shows that party control over either chamber has relatively little to do with long-term changes in the broad S&P 500 stock index
Since 1950, the average annual stock return was 17.2% under a split Congress, 13.4% when Republicans held both chambers, and 10.7% when Democrats had control.
Keep in mind that the stock market typically performs well in November…
The stock market typically performs well in November… November is tied with April for being the second-best month of the year, with the Standard & Poor’s 500 rising 1.5% on average during the month since 1950.
What to expect from the US interest rate obsessed equity markets this Week
Wednesday: Wholesale inventories in the US rose by 0.8 percent month-over-month to $921.7 billion in September of 2022, below estimates of a 1 percent rise and easing from the upwardly revised 1.4 percent increase in the prior month.
Thursday – Consumer Price Indexes (CPI), Jobless Claims, Earnings, Federal Budget
Data that shows the U.S. economy isn’t slowing as the central bank tightens policy will test lower stock prices.
Vica Momentum Stocks Report (Grade A+)
Occidental Petroleum Corp NYSE (OXY) 100 Day Average +28.39%, 200 Day Average +94.41%, YTD +146.59%.
Occidental Petroleum Corporation is an integrated oil and gas company, with significant exploration and production exposure. The company conducts its operations through three segments: Oil and Gas, Chemical, and Midstream and Marketing.
IMPORTANT TO READ; Low interest rates will return!
The Federal Reserve gave guidance that back in August of 2022 that they would raise rates to 4% and have. Rate adjustments will drive down inflation and slow the pace of the economy. Company earnings will remain mixed with stronger support for Communication services, Consumer staples, Energy, Financials and Health care. As these sectors tend to perform well during recessions
Following 2022 we expect the Central Bank to begin to cut interest rates in late Q2 of 2023 to avoid an extended recession. As the cure for inflation is not just raising rates. Vica analysts see a significant policy change coming by late spring of 2023 with Powell reversing direction… just look at 12 month declining lower commodity pricing and new reports on rising retail inventories.
Yearly commodity prices will rise “as there are still production shortages” which include: iron, copper and crude oil. Upside will continue!
Solid strategy for these type of market days ….
We suggest investing in companies that have solid balance sheets and offer dividends.
Look to Communication services, Consumer staples, Energy, Financials and Health care as these sectors tend to perform well during recessions
Best to continue to cost average buy value stocks and resist most all tech and growth stocks where companies have negative margins. Our Teams forecast a negative 6-8% valuation correction for speculative stocks. DON’T try to time market lows!
*** Watch for our emerging 30/ 60/ 90 day Sector and leading company watchlist’s
*** Look to Index ETF’s like SPY to outperform stocks and most managed funds
*** Energy is the Top Performing Sector in S&P 500 Year to Date and is already regaining strength
*** Banks will profit from higher interest rates on new loans and other products which will offset defaults
