Diary of a Financier

Top Newsstuffs (December 26 – January 1)

In Bookshelf on Sun 1 Jan 2017 at 06:13

Top reads from across this Happy New Year week…

Macro

Consumer confidence survey (December 2016)
by Conference Board

Sentiment surged again to the highest level since 2003, crushing expectations even despite a massive upward revision to prior month data…Consumer confidence vs GDP 2016.12
Consumer confidence index: +4.3 mom @ 113.7 (beat 109e); a 13-year high; 84th percentile of historical data
[Previously: Income & consumption remain bullish signals, Retail sales remain bullish & A new generation of Depression Babies?]
#Bullish! $XLY

Sentiment

Retail investor sentiment survey (2016.12.29)
by The American Association of Individual Investors (AAII)

Sentiment remained a neutral signal, but it’s at the threshold of an extremely bearish signal…
Bull/Bear ratio: +24bps wow @ 1.77 (above 1.30 historical average, but between 1.00 – 1.80 extremes)
Bullish: +1.0pp @ 45.6% (over 39 avg & 30 – 45 extremes)Retail investor sentiment- bulls & bear 2016.12.22; the 3rd highest level ytd
Bearish: -3.4pp @ 25.7% (below 30 avg, but between 25 – 40 extremes)
Neutral: +2.5pp @ 28.7% (below 31 avg)
Measures respondents’ expectation for equity performance over next 6 months (through 6/2017).
[Previously: Institutional allocations remain a neutral signal]
#Neutral #Contrarian

Technicals

Update: Stock market seasonality (S&P 500, 2016q1)
by Bank of America Merrill Lynch (BAML) & MKM Partners

As we enter January, SPX is leaving behindSPX seasonality its year-end stretch of seasonally strong performance and entering a period of choppy, average returns.
Mid-February welcomes a more favorable entry point, historically offering +3.25% TR through the end of April.
#Neutral $SPX $SPY

–Romeo

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