***Official*** 2016 Stock Market Thread

[KB]

Just came in to our trade floor. Not proprietary. Enjoy Wednesday!

Sector Analysis (Source: Bloomberg)

Equities:

Clinton wins: S&P 500 Index could gain as much as 3 percent and big losers would be finance, drug companies and banks.

Drug companies are already laggards so I think Drug companies fall may be priced in. Interesting that banks would suffer under Clinton when they did so well under Bill and they have given Hillary so much money. Plus higher bond yields in fixed income are good for banks and bond trading is good for finance.

 

[MomentsofSanity]

Drug companies are already laggards so I think Drug companies fall may be priced in. Interesting that banks would suffer under Clinton when they did so well under Bill and they have given Hillary so much money. Plus higher bond yields in fixed income are good for banks and bond trading is good for finance.

Yeah I don't know if I agree with that part either. Banks like predictability. Certainty. I don't see as big an impact with a Clinton victory. Time will tell though.

I think they were looking at that more of a Democratic sweep, not just Clinton victory. Tougher regulations and taxes would have negative impact. That result seems highly unlikely at this point.

 

[Imp]

Big question is if a Trump win would be like Brexit or more "permanent" -- major sell off then recovery or the start of a year plus long bear market.

Totally being selfish, I think I want a Hillary win because it should lead to a Fed rate increase and better dollar that will turn the market anyway. Trump wins and dollar could tank.

 

[repoman0]

I'm kicking myself for not buying a ton of HUBS and VOO on Friday like I was going to. Figured I'd wait for Monday to wait for everything to drop a bit further and then sell it all on Wednesday after Hillary wins ... Then the FBI propped everything back up on Sunday.

 

[Mai72]

From what I've heard, boomers and "regular" people aren't saving much for retirement with more than a few needing to work in retirement because they have no or not enough money.

This random survey suggests that only about 22% of 55+ people in early 2016 had $300k+ in retirement savings. That group's distribution probably peaks closer to $300k than $1M.

Might be video:
http://time.com/money/4258451/retirement-savings-survey/

And that's being generous. Many people are living longer and have hardly anything saved for retirement. I think it's reasonable to say that an average American can live to 90 today. My uncle just passed away and he was 93. So, imagine if you retired at 62. You could possibly live another 30 years. That means you had better have at least 1 million saved. Anything less and you put yourself in a very precarious state. One illness could eat up much of the money you saved. I didn't even bring up natural catastrophes, cost of living increases or anything else.

Stocks are fine but I'm currently looking at a few multifamily apartments in my area and in NC. I want investments that are going to carry me past retirement. I'd love to have $5-10m in real estate. That's my goal.

 

[Imp]

And there we have it:

<UK emigrant> says that since arriving in Toronto a decade ago, he and his wife have purchased three houses and two condos.

But he rejects the idea that their property investments are contributing to the affordability crisis in the city's red-hot real estate market.

http://www.cbc.ca/news/business/toronto-real-estate-investment-market-prices-1.3834959

I've been seeing anecdotal stories of Canadian citizens or permanent residents buying up multiple investment properties for years. But ya, let's blame it on someone/something else.

 

[Imp]

Hoochie mama. Valeant is now down to CA$ 19.92 (TSX) or US$ 14.98 (NYSE). Something about a billion plus loss and bad guidance.

 

[FelixDeCat]

I am really tempted to buy physical gold right now. I'm only in the market for Eagles and am willing to pay the markup for it because its extremely easy to sell with a large pool of interested buyers of government gold.

The cheapest $50 Gold Eagles are going for $1326 an ounce. Last week the cheapest was $1370. In the last four weeks the cheapest was $1305 an ounce. These are the "ask" prices. The bid price (spot) is currently $1280. I was looking at maybe buying ~$4,000 and hoping to sell at $4,500, a move of $166 an ounce. That is not unreasonable, considering we are about $100 off the 52 week high.

Also, I think turmoil around the election might cause a spike in gold (it already has gone up), I just don't know by how much. Hopefully things settle down, so I would probably sell into the spike. If there is some sort of crises over either's legal problems, it could keep the markets roiled and inflate the price of gold higher than it is now.

What has been holding me back is the Fed's possible action in December. They have been gunning for a hike but now seem to be backing off. A hike or even more talk of a hike would cause gold to drop. Political turmoil might continue the pause in rates, which is good for metals.

Welp, I did not buy gold after all but did buy some NUGT 3X long gold miners at the last second.

 

[JEDI]

Hertz rental car down ~50% today?!

 

[Imp]

This is a fucking mess. Markets re-doing the Brexit thing. But will it be Brexit 2.0 or will it stay this time -- assuming it keeps going the way it's going?

 

[herm0016]

Did not see this coming. Michael Moore was right. Damn. Should have prepared better.

 

[theeedude]

I had SPY puts and GDX, I was kicking myself for not selling on Friday, now I wish I had more
Dow is going to be down 1000 tomorrow, but, if you look at how much it swung vs Trump win probability, the market was pricing in a 15% difference between Trump and Clinton win, so that's about 2000 total drop. So I would not necessarily be in line to buy the dip at this point. US is damaged goods now, like UK after Brexit. A country that elects people like Trump presents a political risk on invested capital that has to be discounted either through reduced valuations or cheaper currency. So, hold on to your collective butts.

 

[FelixDeCat]

I had SPY puts and GDX, I was kicking myself for not selling on Friday, now I wish I had more
Dow is going to be down 1000 tomorrow, but, if you look at how much it swung vs Trump win probability, the market was pricing in a 15% difference between Trump and Clinton win, so that's about 2000 total drop. So I would not necessarily be in line to buy the dip at this point. US is damaged goods now, like UK after Brexit. A country that elects people like Trump presents a political risk on invested capital that has to be discounted either through reduced valuations or cheaper currency. So, hold on to your collective butts.

The last time we had a Brexit type reaction it was temporary. I might consider buying longer term calls on the QQQs if the overreaction holds.

 

[FelixDeCat]

NUGT will probably be up 15 to 20% tomorrow.

 

[AdamK47]

I hear that there is a lot of gold rich land in Canada.

 

[Imp]

So, does this classify as a "Black Swan" event?

 

[theeedude]

The last time we had a Brexit type reaction it was temporary. I might consider buying longer term calls on the QQQs if the overreaction holds.

Pound dropped 15% from 1.45 to 1.25, and stayed there so effectively UK got discounted 15% through currency, even if FTSE recovered in pound terms.
Dollar is down 2% as well, on top of markets being down 4%, so effectively US equity valuations are already down 6% if looking at it from outside the US.
Anything could happen. But based on changes in markets vs odds of Trump win before the election, the market was pricing a 10-15% valuation delta for Clinton and Trump victory case. Some of it will be offset with currency devaluation and running huge deficits for fiscal stimulus. Some of it may be offset by Trump backtracking on the protectionist stuff he promised, throwing his working class supporters under the bus, and becoming an establishment big business Republican he really is. We don't know. I don't think a mere 4% drop is a buying opportunity though. Wait until there is blood in the streets.

 

[Charmonium]

So, does this classify as a "Black Swan" event?

More of a Cheeto Swan event.

 

[John Connor]

Markets just love uncertainty don't they?

 

[Imp]

Wonder if we'll finally get that rate hike in December. Or Trump will follow through and abolish the Fed.

 

[FelixDeCat]

NUGT up 15% so far.....to $15. Would be nice to see $20.

 

[Miramonti]

Bib went to $47+...gotta be a short. USCR, concrete, has surged lol.

 

[ImpulsE69]

Finally BMY made some headway. While gold..well..f' gold...

 

[KB]

Wow we went from -700 pre-market to positive/mixed. Is this a Trump rally. Or maybe I should say a relief rally that it won't be a contested election.

Makes you wonder if maybe the media was in cahoots with Hillary after all. All they kept saying was that if Trump was elected the market would fall. I guess it just proves once again that analysts are good for nothing.

 

[ponyo]

I've seen some big reversal over the years but today is pretty impressive. It's like 6% reversal for S&P and almost 5% for gold. Gold spot is now down minus couple bucks. Pretty crazy.

How much of this reversal is fueled by hedges and protection being unwound from fear of Trump victory and expected selloff we'll never know but we do know the world didn't end with Brexit and Trump win. My guess the world wouldn't have ended if Wall St and banks didn't get their bailout in '08-'09 like we were led to believe.