Research & Data Content Archives
FACTOR WATCH FOR NOVEMBER 8, 2020
Summary The week ended November 6, 2020 saw the S&P 500 rise by +6.04%; the index is now up +8.79% YTD. Risk was the big election week winner, with the marijuana sector gaining +25% in five days, technology (XLK) up +9.39%, Communication Services (XLC) +7.66% and...
FACTOR WATCH FOR OCTOBER 4, 2020
Summary The week ended October 2, 2020 saw the S&P 500 rise by +1.55%; the index is now up +3.72% YTD.Energy - Democratic Presidential candidate Joe Biden’s least favorite sector - continued its horrific decline; oil & gas stocks closed lower by nearly 5% for...
STOCK VOLATILITY AND BOND SPREADS FLASHING CAUTION SIGNS FOR EQUITIES
Summary: Signals derived from our U.S. equity models began to indicate a bullish outlook beginning on March 19, 2020, but in the last two weeks, credit spreads, volatility and momentum indicators have begun to flash caution. These are among our most important...
FACTOR WATCH FOR SEPTEMBER 27, 2020
Summary The week ended September 25, 2020 saw the S&P 500 decline by -0.58%; the index is now down -5.63% month-to-date, and up +2.13% YTD. Our long/short fund-FlowPoint Capital Partners, LP is up +1.7% MTD and +17.4% YTD.Sector-wise for the week, U.S. casino,...
FACTOR WATCH FOR SEPTEMBER 13TH, 2020
Summary The week ended September 11, 2020 saw the S&P 500 decline -2.48%; the index is now down -0.83% month-to-date, and up 3.79% YTD. Last week saw the first consecutive week of back-to-back weekly declines since April.U.S. Homebuilders (ITB) led all global...
CREDIT DEFAULT SWAPS – A BLINKING YELLOW LIGHT IN AN OTHERWISE GREEN TAPE
Summary: Signals derived from our U.S. equity models have been flipping to a bullish outlook since March. Equity trends, volatility and credit spreads are generally positive.However, last week, credit default swaps on investment-grade debt ticked higher. CDS are...
FACTOR WATCH FOR SEPTEMBER 7, 2020
Summary The week ended September 4, 2020 saw the S&P 500 decline -1.93%; the index is now up 2.39% for the month and 6.43% YTD.Factor-wise, the best-performing factors YTD were also the best for the week, including Revenue Estimate Dispersion (+4.81% for the week...
MEDIUM-TREND MODEL NOW POSITIVE, GLOBAL BREADTH IMPROVING
Summary: Another new Buy signal in our U.S. equity models was triggered last week. On August 26, 2020 our Medium-Term Trend model flipped when the S&P 500’s 100-day moving average closed above its 200-day average.This change in confirmed earlier signals from our...
FACTOR WATCH FOR AUGUST 30th, 2020
Summary The week ended August 28, 2020 saw the S&P rise 2.23%, and the index is now up 8.92% YTD. European and Chinese stock markets are within a few percent of their 52-week highs as well.Domestic breadth continues to expand to include not only growth and...
FACTOR WATCH FOR AUGUST 23rd, 2020
Summary The week ended August 21, 2020 saw the S&P rise 0.46% and the index is now up 5.47% YTD.Factor-wise, it should be no surprise that Momentum led all categories, up 4.22% on the week on the backs of Apple (+8.52%), Tesla (+11.68%) and the tech index...
FACTOR WATCH FOR JULY 27th, 2020
Summary The week ended July 24, 2020 saw the S&P decline 1.06% and the index now stands about break-even for the year. Tech led the downturn last week including Intel, Citrix and Tesla all declining more than 10%. The market executed a “dash to trash”, scooping up...
THE “REOPENING STOCKS” LOVE VACCINE CHATTER – ON THE HORIZON?
Summary The week ended July 17, 2020 saw the S&P rise 2.1% in a broad-based rally. For example, every stock in the S&P 500 Health Care, Materials and Utility sectors rose, and only one stock in the Industrial sector fell during the week. Overall, 90% (448 of...
PLUNGING VOLATILITY REMAINS UNDERAPPRECIATED
Summary: As previewed in our June 2 note (“Volatility is on the cusp of another “Buy” signal for stocks) another new signal in our models was triggered last week. Our Trend1 model is a trend-following model we apply to credit spreads, volatility, indexes and other...
BIG WEEK UPCOMING FOR THE BANK STOCKS. VALUE FACTOR HANGING ON BY A THREAD. KICKSAVE?
Summary During the week ended July 10, 2020 which saw the S&P move up by 1.76%, only 30% (154 of 500) of stocks in the S&P 500 rose; the average winner was up 2.1%, led by Netflix, Twitter and Wal-Mart which all rose more than 9%. Clearly the S&P...
VALUE “COMEBACK” LAST WEEK. SUSTAINABLE, OR DEADCAT BOUNCE?
Summary During the week ended July 2, 2020, 77% (385 of 500) of stocks in the S&P 500 rose with the average winner up 2.6%. The 115 losers lost an average of -1.6%. Real Estate, Communication Services and Health Care led the upside.The most effective quant...
FLOWPOINT’S COVID REOPENING INDEX
Summary Covid-19 has shuttered entire segments of the global economy. Companies levered to travel, entertainment and office space have seen significant reductions in business fundamentals, and their shares have lagged. Might these stocks represent attractive entry...
FLOWPOINT’S WORK FROM HOME INDEX
Summary Covid-19 has transformed how and where employees work and accelerated consumer and corporate reliance on technology. Stocks levered to the Work From Home theme have garnered attention.FlowPoint has calibrated an index of 87 companies and four ETFs directly...
BUYBACK KINGS ROLL OVER
Summary Once again, stocks of companies with high debt, volatile share prices, “value” measures and high buybacks fared the worst of the U.S. market the week ended June 26, 2020.Reversing course, 93% (467 of 500) of stocks in the S&P 500 declined during the week...
REOPENING
Summary 86% (432 of 500) of stocks in the S&P 500 rose during the week ended June 5, 2020. The “reopening” theme continued to gain steam, and financial leverage was the dominant factor. The highly indebted Oil Services group led the way, up 29% for the week,...
THE U.S. DOESN’T EXPERIENCE LOW-VOL BEAR MARKETS
The Q2:2020 plunge in Volatility is Underappreciated. Is a New Low-Risk Bull Underway? Summary: As previewed in our June 2 note (“Volatility is on the cusp of another “Buy” signal for stocks, just barely hovering above the 24% annualized figure that keeps this signal...
TED SPREAD, THE MARKET, AND BANK STOCK IMPLICATIONS
Summary The TED Spread is a terrific gauge of financial system stress in the U.S. The TED (Treasury-EuroDollar rate) spread measures the difference between the 3-month U.S. Treasury bill and the 3-month LIBOR, in USD. It widens and remains high during periods of...
OPPORTUNITIES IN A LOW(ER) – CORRELATION MARKET – MOTHER’S MILK FOR HEDGE FUNDS
Summary Stock correlation is often the enemy of the active investor. When correlations are high, most stocks trade in the same direction, offering diminishing opportunities for outperformance through security selection.For example, in 2008, nearly all stocks declined...
VALUE PARTICIPATION
FlowPoint Research – FACTOR WATCH Summary 91% (455 of 500) of stocks in the S&P 500 rose during the week ended May 29, 2020. The “reopening” theme was evident. For example, the top 50 performers in the S&P 500 included cruise lines, hotels, banks, REITs and...
PROPRIETARY INSIGHTS ON TREND, MOMENTUM, CREDIT SPREADS, VOLATILITY MEASURES AND MARKET BREADTH
FlowPoint Research – Long-Short U.S. Equity Model Signals Summary One by one our model signals are starting to register green shoots for stocks. The most recent signal change is the decline in credit spreads (bullish for equities). On May 20, BBB spreads...
“THE BUYBACK KINGS AREN’T WEARING ANY ROBES”
FlowPoint Research – FACTOR WATCH Summary The most effective factors in stock performance for U.S. stocks YTD are revenue growth, share price momentum and estimate revisions. “Value” measures have been the biggest detractors to performance, causing angst and (loud)...