David's Feed
Dec 8, 2014
via Morning Bid with David Gaffen

The Energy-Industrial Complex

The next few weeks will bring a few analyst meetings out of some of the bigger industrial companies, including Dover Corp. The company is expected to hold a confab Monday to discuss where things stand this year, particularly as it has a 36 percent exposure to the energy industry through businesses that produce equipment for the gas and oil extraction industries – pumps and other such equipment.

Dover has been pretty optimistic for some time on this front, with its annual report last year boasting of global expansion and expectations that North America would bring new opportunities as well.

Dec 4, 2014
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The Market’s Silly Season

The meaningful part of the year is drawing to a close (near as I can see it, there’s tomorrow’s jobs report, the Fed meeting in two weeks, and, yep, that’s about it), and as we head into the silly season for happenings in our markets, here’s a laundry list of oddball things to consider:

JOBS DATA
This is not going to materially affect the Fed in one direction or the other. The recent inflation data and the plunge in oil prices has some smart people (and some overconfident ones) thinking the Fed is in no way going to raise rates in 2015, but three consecutive quarters of above-trend growth, which is where we’re headed, won’t continue to justify a zero-bound interest rate. It just won’t.

Dec 3, 2014
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Microsoft’s 15-Year Itch

New Microsoft CEO Satya Nadella will come to his first annual shareholder meeting having boosted the company’s market value by about $90 billion in less than a year’s time (that the stock market is running wild, and Microsoft with it, well, that’s not the only thing that’s important, one supposes) as Nadella has pushed ahead with various efforts to make Microsoft something closer to the powerhouse that it had been some years back.

The move in shares – tapping $50 for the first time since god-knows-when (ok, it was nearly 15 years ago, at the end of the tech bubble) comes as the company remains a steady source of demand for its own stock, having bought back more than $3 billion in shares in its most recent fiscal year.

Dec 2, 2014
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The ‘Worst’ Central Bank, Like, Ever

One day ahead of Friday’s key U.S. jobs report, markets will turn their attention to the European Central Bank, which is currently engaging in what strategist Rich Bernstein of Richard Bernstein Advisors calls a quest to become “the worst central bank in all of history.”

As the ECB once again meets to either do what ECB chief Mario Draghi says it will do “whatever it takes,” (which apparently involves a lot of jawboning while contracting, not expanding, its balance sheet), or what the Germans want (pretty much what it’s doing now), we look again to see that the ECB in recent days has not done all that much to move the needle when it comes to getting more aggressive.

Dec 1, 2014
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The Oil Conundrum

There’s a real question right now about whether the sharp decline in oil prices will continue to have a ‘rising tide’ effect on the rest of the economy, thanks to the help it gives to consumer spending, or whether that marginal benefit is offset by a drop in oil production and mining jobs.

The fixed income market is certainly reacting as if it’s the latter, although this could also be the result of more weak data out of Asia and Germany that suggests those economies are nowhere near getting off the mat any time soon.

Nov 24, 2014

Strategist Bernstein sees more equity gains, likes high-yield munis

NEW YORK (Reuters) – Longtime Wall Street strategist Richard Bernstein hasn’t quite gotten used to investors’ reactions when he tells them his favorite asset class for 2015 is the same as in 2014 – high- yield municipal bonds.

“A lot of times when people ask me that question, they’re physically disappointed when I tell them,” said Bernstein, chief investment officer at Richard Bernstein Advisors LLC, which he founded in 2009. “‘That’s the best you can come up with?’ That’s the response.”

Nov 20, 2014
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The Hunger Games

The IPO train keeps on running, and on Thursday, it’s being fueled with hamburgers.

One of the new companies set to begin trade is Habit Restaurants, a chain offering “char-grilled burgers and sandwiches” that operates in California, Utah, Arizona, and strangely, New Jersey.

Nov 19, 2014
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As shaky as a fiddler on the roof

It’s nice to look back every month or so and see just how far the market has come, and, well, it’s come a long way. And it’s worth noting yet again that investors are starting to talk about corrections.

Even the most bullish – the ones who have been positive for quite some time – are starting to again shake their heads in the knowledge that this market is up more than 50 percent in just a bit under two years at a time when U.S. economic growth, while still at a level that would make Europe envious, isn’t exactly amazing (It’s nice. Not thrilling. But nice).

Nov 18, 2014
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Building a Safe

The housing-market recovery, the improvement in the unemployment rate and the relatively strong consumer sentiment figures seen out of the United States in recent months bodes well for Home Depot and other big-ticket retailers (like Lowe’s, for instance) as they report this quarter’s earnings.

Housing hasn’t been as robust as it had been in the past – that market has slowed in terms of its overall growth rate regardless of the ultra-low interest rates that have embedded in the landscape – but existing home sales (of which we’ll get more clarity later in the week when the October release is out) rebounded in September to their best seasonally adjusted annual rate all year.

Nov 17, 2014
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Turning Japanese

Just when the market thought it was out, it gets pulled back in. The bond market continues to threaten to break into higher levels, but something always seems to undermine that story.

This weekend it was a slack Japanese figure on gross domestic product that did the trick. The prevailing range between 2.30 percent and 2.40 percent is being tested again as buyers come in through the Asian markets, particularly to long-dated and middle maturities in fixed income.

    • About David

      "David Gaffen oversees the U.S. markets team, having joined Reuters in May 2009. He spent four years at the Wall Street Journal, where he was the original writer of the web site's MarketBeat blog. He is a frequent guest on Reuters TV, and has appeared on CNN International, Fox Business, NPR, and assorted other media and is the author of the book "Never Buy Another Stock Again.""
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