Second Half Playbook
On Friday, I joined Seana Smith on Yahoo! Finance. Thanks to Sarah Smith and Seana for having me on the show. Watch this clip to get the playbook for the next 6 months:
Watch in HD directly on Yahoo! Finance
This chart ties in one of the key points I made above:
Some Picks
Last night, I joined Phil Yin on CGTN America. Thanks to Toufic Gebran and Phil for having me on the show. As always, Phil asked me for some stock picks along with my view of economic developments, so here they are:
The purpose of the following charts and tables is to remind skeptics that the data continues to come in better than expected. While the back half of the year returns for the indices may be more muted than the first half, there is still significant opportunity. However, the most money will be made “under the surface” with dozens of individual laggards that can be up 20, 30, 50 and even 100%+ in 2H.
Positioning
Commercials still long, Hedge Funds still short the whole way up! We continue to follow the commercials and ignore the large managers who told you to sell at the October lows.
Sentiment
Money Supply
Earnings Expectations
Earnings: Set up going into Q2 earnings season the same as going into Q1.
-For Q2, the estimated earnings decline for the S&P 500 is -6.5%
-Q1 had a similar set-up and wound up at -2%.
-Everyone has been calling for a 20% earnings decline since October. Instead, we got a 25% rally in the S&P 500.
-What now? 2024 estimates are going UP in recent weeks to ~$247.
Analysts playing “catch up” on buy ratings:
Economic Data
Seasonality
UK
Banks
Now onto the shorter term view for the General Market:
In this week’s AAII Sentiment Survey result, Bullish Percent (Video Explanation) ticked down to 41.9% from 42.9% the previous week. Bearish Percent flat-lined at 27.5% from 27.8%. The retail investor is still optimistic. This can stay elevated for some time based on positioning coming into these levels.
The CNN “Fear and Greed” flat-lined from 79 last week to 79 this week. Sentiment is hot but it would not surprise me if it stays pinned for a bit to force people out of their bunkers and back into the market. You can learn how this indicator is calculated and how it works here: (Video Explanation)
And finally, the NAAIM (National Association of Active Investment Managers Index) (Video Explanation) ticked up to 83.60% this week from 81.66% equity exposure last week. Managers have been chasing the rally.
Our podcast|videocast will be out late today or tomorrow. Each week, we have a segment called “Ask Me Anything (AMA)” where we answer questions sent in by our audience. If you have a question for this week’s episode, please send it in at the contact form here.
*Opinion, not advice. See “terms” above.
