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Strategies & Market Trends : Dino's Bar & Grill -- Ignore unavailable to you. Want to Upgrade?

To: Goose94 who wrote (15270)	12/22/2015 11:54:50 PM
From: Goose94	Read Replies (1) \| Respond to of 203849

Cameron Hurst U.S. Markets on BNN.ca Market Call Tuesday Dec 22th @ 1300ET Outlook: Negatives: - It’s been a long bull market run, even if it hasn’t felt easy, and we’re in the later stages - Market breadth has been narrowing for some time now - Fewer and fewer large cap stocks are holding the market up - Equal-weighted S&P 500 has been underperforming cap-weighted since April - Sector rotation showing accelerating with few sectors beating the aggregate index - Clear defensive rotation into staples and even very recent upticks in utilities and telecom - Earnings and revenue continue to slow - It has become more important to avoid the losers than own the winners, very dangerous situation - Credit cycle is rearing its head in energy and banks are seeing higher delinquencies, losses - Commodities making new lows on very broad weakness, e.g. industrial metals, precious metals, oil, gas - U.S dollar strength has all kinds of ripples around the world, from commodities to Emerging Markets A couple observations: 1. Volatility – we’ve experienced a secular step-up in volatility, enabled by massive advances in technology; as a result, markets have become hyper-sensitive to news and economic developments and react much faster and more unpredictably 2. Correlations – notwithstanding the increase in volatility, historical patterns of correlation haven’t changed much; they may not repeat, but they certainly do rhyme. 3. This is why we believe in using an unemotional lens to help U.S in the investment process; our Market Stress Indicator monitors global volatilities and inter-asset correlations for signs of stress and prevents U.S from getting married to a particular investment view or a position 4. We also use technical analysis to avoid the trap of emotional attachment to stocks and the market as a whole 5. Everything we look at right now is flashing red, the Market Stress Indicator is telling us we’re in a risky environment and our technical analysis shows all kinds of red flags, from narrowing breadth top defensive sector rotation to widening credit spreads 6. Investors are positioned with unusual uniformity, further raising the risks, e.g. long U.S dollar, short energy, long tech, long interest rate sensitive names, etc. 7. We look at risk first and foremost aim to avoid losing client capital, so we’re positioned cautiously and waiting for our work to demonstrate a more hospitable investing environment