Friday, September 22, 2017

Who's Moving?

The share of Americans who moved to a different residence last year fell to its lowest point in the past decade, according to new estimates from the Census Bureau’s American Community Survey. But the degree of movement isn't the same for every generation.

This all-time low only holds when you include people under age 29, many of whom fall in the millennial generation. The number of people aged 20 to 24 who move has dropped by 6 percentage points in the last decade.

At the other end of the scale, older workers and those at or approaching retirement age are actually moving a bit more than they used to. U.S. residents ages 65 and over stopped moving as often in the wake of the recession, but in 2016 they actually moved at a faster rate than before the recession began.

Thursday, September 21, 2017

The Wild World of Consumer Stocks

Retail-sector blowups have driven the correlation between stocks in the S&P 500′s consumer discretionary sector to their lowest levels in years. The rolling 65-day correlation for consumer discretionary stocks in the S&P 500 stocks is at 0.39, near the lowest in at least seven years, according to Chris Verrone and Todd Sohn at Strategas Research Partners. The average since the start of 2011 is 0.56.

The changing retail landscape has made for very different fortunes for different consumer companies. Some of the biggest movers this year:

  • Wynn Resorts: up 66.58 percent
  • Netflix: up 45.52 percent
  • Mattel: down 47.30 percent
  • Foot Locker: down 51.81 percent

Wednesday, September 20, 2017

A World of Contrasts

A lot of stocks listed in emerging economies are are having banner years. The  MSCI Emerging Market Index has climbed 28 percent in dollar terms in 2017, far outpacing the 12 percent advance for S&P 500, according to Yardeni Research.

But not all of them are flourishing, and the range of individual country performances has been extreme. Yardeni says the correlation between individual emerging-market stock exchanges this year has plunged to 10-year lows.

For example, the MSCI India Index this year is up 23 percent in rupees while Brazil has climbed 24 percent in reals. Meanwhile, Russian stocks, as measured by the MSCI benchmark in rubles, have slumped 9.1 percent. Pakistan, which was upgraded from frontier market to emerging status just this year, is down 19 percent.

Tuesday, September 19, 2017

Where the Buybacks Here

Buybacks for companies in the S&P 500 index have been steadily dropping: They reached $120.1 billion in the second quarter, which is off 5.8 percent from the year-ago period, when companies repurchased $127.5 billion of their own stock. It's also down 9.8 percent from the first quarter of 2017.

One area where buybacks actually increased was the technology sector. Tech spent $27.6 billion on buybacks in the quarter, up 0.5 percent from the first quarter of 2017. Tech represents 23 percent of all buybacks, according to S&P.

On the other hand, there's Apple. The largest company in the economy by market capitalization, Apple spent "just" $7.1 billion on buybacks in the second quarter, down from $10.2 billion in the second quarter of 2016.

Monday, September 18, 2017

Another Year for Coming Out of the Market

Even with stocks in the midst of one of their best-ever runs, investors are on pace to pull more money out of U.S. stock funds than they put in for the third straight year and the eighth in the last 10 years. Through the first seven months of this year, investors pulled a net $8 billion out of U.S. stock funds.

In the years running up to the Great Recession, more money was going into the market than coming out. Now, the tide is in the opposite direction. Investors pulled an average of nearly $24 billion out of domestic stock funds annually from 2008 through 2016.

Instead of U.S. stocks, investors have been more interested in bonds. More than $235 billion went into bond funds through the first seven months of the year.

Friday, September 15, 2017

The Bulls Are Back

After tracking below historical levels for much of the year, bullish sentiment among investors jumped to its highest level since January for the week ended Wednesday. That's according to the American Association of Individual Investors’ latest sentiment survey.

Of those polled, 41 percent said they felt the stock market would rise over the next six months, up from 29 percent in the prior week. Meanwhile, 22 percent said they expected stocks to fall, down sharply from 36 percent.

But remember, the AAII results are often a contrarian indicator. That’s because some feel the stock market is most likely to crash when investors are piling in with little hesitation, as was the case around the time of the dot-com boom. On March 8, 2000, AAII said 58 percent of investors were bullish on the stock market - two days before the Nasdaq Composite finally reached its peak.

Thursday, September 14, 2017

The High Cost of Sports

America’s sports-industrial complex took in more than $100 billion last year, according to a survey released this week by CreditCards.com. Fans’ spending included $55.9 billion for sporting events, $33.4 billion for athletic equipment, $19.2 billion for gym memberships, $8 billion for sports-themed games, $4.8 billion for race entry fees and $2.3 billion for fantasy sports leagues.

In addition, 43 percent of the 18-to-53 age cohort paid to attend a sporting event in the preceding 12 months. Among those 53 and older, only 21 percent attended a sporting event.

CreditCards.com noted that a family of four put out $503 in 2016 to attend an NFL game, up 232 percent from $151 in 1991 - covering two adult tickets, two children’s tickets, two small beers, four small soft drinks, four hot dogs, two programs, two adult-size ball caps and parking. The same family spent $339 in 2016 to attend an NBA game, and $219 to watch a Major League Baseball game.