No6's Financial Markets Thread

[John Doe]

What is interesting about that chart is the similar pattern 2002-5, compared to 2009-10. The earlier period is a little smoother, but essentially carried on upwards until topping out in 2007/8. It is easy to see how another bullish period could be setting up as indicated on the chart. Of course, the pattern may not repeat at all.

Pretty much as a consequence of low rates for too long.

 

Sounds familiar.

 

After having a good few days away from everything to think about it, I'm ready to go long on the next decent pullback.

[John Doe]

Amazing. If ever something was so manufactured, FTSE hit 6000 just near the closing bell*.

Good call 6

 

Also, thank you for the thread, it has helped shape several other threads on the forum, opening up some good debates (and even a few where passions run deep!)

 

Seems oil is also a lot closer to $100 than when we discussed what might be bid up over the santa season.

[No6]

US Corporations hold $1trillion in cash.

 

The Stock Rally May Still Have Legs in 2011

 

Prospects for strong earnings, plus all the cash on balance sheets, have strategists predicting an 11 percent gain for the S&P 500

 

Goldman Sachs' (GS) David Kostin, the most accurate U.S. strategist of 2010—he predicted the index would finish at 1,250—says sales growth will send the S&P 500 up 15 percent, to 1,450, through the end of 2011. "Company balance sheets have never been stronger," he says, citing Goldman Sachs data showing corporations hold more than $1 trillion in cash, the most ever relative to the value of their assets. "We expect S&P 500 firms will increase spending in all categories, with the fastest growth in acquisitions and share repurchases." He is the second-most-bullish of the strategists surveyed.

 

==============

 

One potential risk is shrinking profit margins, according to Citigroup's © Tobias Levkovich, who estimates a 3.3 percent gain for the S&P 500 next year, to 1,300. That's the second-most pessimistic projection of the 11 strategists. While Levkovich is upbeat about the first six months of the year, saying the market could exceed his estimate as businesses spend and confidence returns, the second half won't be as positive. He's concerned that profit margins, which have expanded to the highest levels since 2007, may begin to shrink.

 

http://www.businessweek.com/magazine/conte...ets+%2B+finance

[No6]

Are we on the verge of another tech stock bubble?

 

Tech Stocks Set To Soar in 2011, Investing in the Next Microsoft

 

Kerri Shannon writes: Technology companies, and tech stocks, started a revival in 2010 and are heading toward an even more profitable 2011. That's because a new age of computing - one that prioritizes mobility and efficiency - has dawned in the computing world.

 

Indeed, we've entered what researching firm International Data Corporation (IDC) calls a "new era" of computer usage.

 

==================

 

Overall tablet sales are expected to more than double next year, according to IDC. And shipments could grow an average of 57.4% per year in 2010-2014 as emerging market demand for the technology heats up.

 

IDC estimates that IT spending in regions like Latin America, Asia, the Middle East and Africa next year will increase by 10.4% to $440 billion - equal to 27% of total global IT spending.

 

Worldwide IT spending will grow by 5.7% next year to $1.6 trillion, IDC says.

 

==================

 

Cloud computing - web-based storage and network service - was one of the hottest tech buzzwords in 2010. Public clouds are becoming "the dominant technology platform for the next 20 years," said Frank Gens, chief analyst for IDC.

 

Worldwide spending on public IT cloud services will hit $29 billion next year, a 30% jump from 2010. Furthermore, 80% of new software products will be deployed on cloud platforms. This will push cloud computing to a crucial point in 2011, said IDC's Gens, as it becomes the norm for corporations' IT models.

 

The rapid growth in cloud computing has already triggered a flurry of mergers and acquisitions (M&A) activity in the data storage market. Hewlett-Packard Co. (NYSE: HPQ) bought 3PAR Inc. in September for $2.35 billion, EMC Corp. (NYSE: EMC) bought Isilon Systems Inc. (Nasdaq: ISLN) in November for $2.25 billion, and Dell Inc. (Nasdaq: DELL) bought Compellent Technologies Inc. (NYSE: CML) earlier this month for $960 million.

 

http://www.marketoracle.co.uk/Article25301.html

[romans holiday]

US Corporations hold $1trillion in cash.

Inflationsists make much of this... the so-called cash on the sidelines about to get in. But I see quite a different dynamic at play. To me it smacks of the "liquidity preference"... where economic uncertainty leads to players wanting to maintain a strong cash position.

[No6]

UK Christmas shopping tracker. How did the retailers do this year after all the doom and gloom predictions? Worth watching to see what is happening before the VAT hike.

 

Asda pleased with trading as shoppers beat big freeze

 

Published Date: 30 December 2010

 

Supermarket chain Asda said shoppers planned ahead to beat the bad weather after busier-than-usual trading in the two weeks before Christmas.

 

After the snow left shoppers without last minute essentials in 2009, Asda said many customers opted to split their big shop over two trips this year.

 

Last Thursday - December 23 - was still the chain's busiest festive day with a record four million customers in its 384 UK supermarkets.

 

However, the fortnight leading up to Christmas saw 11 stores record sales of more than £7 million, compared with the nine that passed the figure in 2009.

 

The company's stores at Boldon, Tyne & Wear and Havant, Hampshire both took over £8 million in the two weeks, while other leading stores included Queensferry in Edinburgh and Enniskillen.

 

While Asda has not disclosed trading figures for the period, it described the run-up to Christmas as good and said it was "pleased with the continuing momentum".

 

http://www.yorkshireeveningpost.co.uk/busi...g-as.6675350.jp

 

John Lewis breaks sale records

 

Thursday December 30th 2010

 

In its mid-week Christmas trading update, the Group says that their clearance event has had a storming start

 

Commenting on the first three full days of Clearance (Monday 27 December to end of Wednesday 29 December), Nat Wakely, Director Selling Operations for John Lewis, said,"We have had a fantastic start to Clearance with both 27 and 28 December beating our previous record for a single day's sales. We saw sales of £27.8m on 27 December which is up 54% on the same day last year (which was a Sunday) but more significantly it is +30% on our previous biggest ever day, which was 27 December 2008.

 

http://www.theretailbulletin.com/news/john...cords_30-12-10/

 

Christmas Day and Boxing Day reach £388 Million in online retail sales

 

Tuesday December 28th 2010

 

On Christmas Day alone sales-savvy online consumers spent £123 million, according to estimates by Retail Decisions (ReD).

 

On Boxing Day, online sales climbed even further, soaring to an estimated total of £265 million.The tradition of sales beginning on Boxing Day may still be clinging on in parts of the high street, but online bargains are also being offered.

 

Retailers such as John Lewis enticed an early spending frenzy this year by luring consumers with exclusive online sales starting as early as Christmas Eve. ReD’s figures show that Christmas Day shopping peaked just before Britain tucked into turkey, with 12.58am tipped as the busiest online shopping minute.

 

http://www.theretailbulletin.com/news/chri...sales_28-12-10/

[No6]

Inflationsists make much of this... the so-called cash on the sidelines about to get in. But I see quite a different dynamic at play. To me it smacks of the "liquidity preference"... where economic uncertainty leads to players wanting to maintain a strong cash position.

The economic uncertainty will result in companies and investors looking to hold their position. Many companies will want cash because the banks have let them down in the last 3 years by making it difficult to borrow on favourable terms. Ultimately companies and investors will want to put the money to work, especially those that are responsible to shareholders. Shareholders will want to see the money working.

[No6]

UK Christmas Shopping Tracker 2 - Manic in Croydon.

 

Croydon bargain hunters flock to the shops after Christmas

 

QUEUES formed at shops and the town centre was "manic" as post-Christmas bargain hunters hit the sales.

 

Retailers say their takings are up on this time last year, thanks to a boom in trade on Boxing Day, Monday and Tuesday.

 

According to Andrew Bauer, director of the Whitgift shopping centre, the spending spree may well have salvaged Christmas trading for many retailers, who had seen the normally busy period before the festive season devastated by the heavy snow.

 

Mr Bauer said: "Since the beginning of the week the shoppers have gone manic.

 

"It was a bit like a return to old sales conditions, and from what my people are telling me, the post-Christmas numbers were much more than we expected.

 

"It has been extremely good."

 

http://www.thisiscroydontoday.co.uk/news/S...il/article.html

 

Christmas sales: retailers report strong start despite snow disruption

 

• Asda: 4 million customers on 23 December

• Waitrose has 'most successful Christmas'

• John Lewis sale beats previous record day by 30%

• Snow forces retailers to discount stock

 

Supermarket group Asda said today that it had a "good" Christmas while John Lewis hailed a "record" start to its Boxing Day sale, giving City analysts their first taste of how major retailers fared during the crucial trading period.

 

Experts are worried the freezing weather cost retailers sales but Asda suggested customers had learned from last year's bad weather, with thousands choosing to split their "big shop" over two trips this year - a tactic that was also used to spread the cost of the holidays.

 

http://www.guardian.co.uk/business/2010/de...lers-good-start

 

And what about Europe?

 

Europe Retail Sales Rise at Fastest Pace Since 2008, Markit Says

 

December 30, 2010, 8:36 AM EST

 

Dec. 30 (Bloomberg) -- European retail sales increased at the fastest pace in 2 1/2 years in December, signaling consumer spending is gaining strength in the 16 nations using the euro.

 

A gauge of euro-area retail sales increased to 52.9 this month from 51.3 in November, London-based Markit Economics said in a statement on its website today. That is the highest since May 2008, Markit said. The index is based on a survey of more than 1,000 executives and a reading above 50 indicates expansion.

 

The data “suggest that consumer-spending growth will accelerate in the final quarter of 2010, with German consumers leading the way,” Trevor Balchin, senior economist at Markit, said in the statement. The October-December period was “the best quarter in terms of monthly sales growth since the fourth quarter of 2006.”

 

http://www.businessweek.com/news/2010-12-3...arkit-says.html

[No6]

Good start to the markets for the new year?

 

Index: Factory growth speeds up; construction spending rises

 

WASHINGTON (AP) — Manufacturers produced more goods and booked more orders last month, a trade group says, leading to the fastest growth in factory activity since May. Meanwhile, construction spending rose for a third straight month in November.

 

The Institute for Supply Management says its index of manufacturing activity rose to 57 in December from 56.6 in the previous month. Any reading over 50 indicates growth.

 

The index rose to 60.4 in April, the highest level since June 2004. It had bottomed out at 32.5 in December 2008, the lowest since June 1980.

 

The latest report shows that manufacturers carried considerable momentum into the new year. The new orders index rose sharply to 60.9, also the highest since May. The production index also jumped.

 

http://www.usatoday.com/money/economy/2011...-spending_N.htm

 

NEW YORK (CNNMoney) -- Manufacturing activity expanded for a 17th month in a row in December, at a faster pace than the previous month, a purchasing managers' group said Monday.

 

The Institute for Supply Management's index for manufacturing activity ticked up to 57 in December from 56.6 in November.

 

The reading came in slightly lower than the 57.3 level expected by a Briefing.com consensus of economists. Any reading of more than 50 indicates expansion in the sector, and the index has remained above this mark for 17 consecutive months.

 

"We saw significant recovery for much of the U.S. manufacturing sector in 2010," said Norbert Ore, chair of the ISM Manufacturing Business Survey Committee, in a statement. "The recovery centered on strength in autos, metals, food, machinery, computers and electronics, while those industries tied primarily to housing continue to struggle."

 

http://money.cnn.com/2011/01/03/news/econo...uring/index.htm

[No6]

UK Christmas Shopping Tracker 3: Records broken in Peterborough and the VAT Rise. I'm not convinced that 2.5% increase will mean that much, especially when you take into account that retailers regularly have sales with 50%+ off, even if the selling price is a bit of a marketing con, people still go for it.

 

TILLS in the city have been ringing to the sound of sales as people have been grabbing bargains ahead of tomorrow’s rise in value-added tax (VAT).

 

Stores in Peterborough have seen record Christmas and New Year sales which they say have been boosted by the prospect of the Government increasing VAT by 2.5 per cent, from 17.5 per cent to 20 per cent, in a bid to raise £13 billion for its coffers.

 

John Lewis, in the Queensgate Shopping Centre, is celebrating after it saw a 12 per cent increase in its sales from December 27 to 31 compared to 2009.

 

Peterborough store’s operations manager Tracy Venner said shoppers grabbing deals before the VAT hike had helped boost electrical and furniture.

 

It saw a 102 per cent increase in computer sales compared to 2009 and a 48 per cent increase in sales of audio and television equipment.

 

http://www.peterboroughtoday.co.uk/news/bu..._rise_1_2224598

 

VAT rise means £2.2bn in lost sales, says report

 

Retail sales will fall by about £2.2bn in the first quarter of 2011 because of the rise in VAT, according to a report.

 

It says consumers will rein in their spending after the standard rate of VAT rises from 17.5% to 20% on Tuesday.

 

http://www.bbc.co.uk/news/business-12107419

[No6]

Hong Kong Posts Record Share Trading on China Concerns, Biggest IPO Year

 

A record number of shares traded on the Hong Kong stock exchange in 2010 after the city completed its biggest year for initial public offerings, and as concern about China’s anti-inflation policies prompted an increase in short-term trading.

 

The total volume of exchange-traded securities, including equities, warrants, options and exchange-traded funds, surged to an all-time high of 34.99 trillion in 2010, according to data from the stock exchange. Average daily trading volume reached a record 140.53 billion securities. That surpassed previous highs set in 2008, with total volume of 27.1 trillion shares, and average daily volume of 110.63 billion. At the same time, the volume of stocks traded on major regional rivals declined from 2009, according to data compiled by Bloomberg.

 

http://www.bloomberg.com/news/2011-01-03/h...t-ipo-year.html

[No6]

Year 3 of the Presidential cycle is usually a good one. What interests me is that 1st Term stat since 1945. +21.0% change and 100% up years in the Presidential cycle. Can't get much more positive than that. The last time the US market went down in the year before a Presidential election was 1939!

 

In a few short weeks the presidential cycle will enter its third year and the market has been kind to investors at this point in the presidential cycle. As the below chart details, since 1945, the third year of a president's term has seen the S&P 500 Index rise an average of 17.1% and up years have occurred in 94% of those years.

 

 

S&P notes in the 2011 Outlook Forecast newsletter:

 

A rational for third-year outperformance, in our opinion, is stimulus anticipation. To stay in power, the president typically uses policies designed to stimulate the economy before voters go back to the polls in November of year four. Investors anticipate the benefit of this stimulus to economic growth, corporate earnings, and consumer confidence, and bid stocks higher in year three.

[littledavesab]

150% is very good, but I would say you shouldn't necessarily give up on equities, just stay nimble as you seem to have during this bumper ride. And you should forget about the shares rising on hot air bit, as they do that all the time, just as they often irrationally fall. I don't think you could ever justify buying shares purely using fundamentals, or whether there is good or bad news. What I like about charts, especially the longer term ones, daily, weekly, monthly, is that they tell a story and often they are like an ocean liner in that they can move slowly in one direction for a long time and then when the change in direction comes, the turn is often just as slow. Perfecting an understanding of this on the charts should see you ok. Of course, just like the Titanic, every so often an iceberg comes along that sinks the ship, but when was the last time you heard of this happening to an ocean liner? Big market crashes (and certainly crashes of individual shares) happen arguably more often, but they are still rare events and usually the longer timeframe charts will give you some warning that all is not well. Well, that's the way I try to play it. As for crashes, I really don't think anyone can predict that and those that do basically got lucky, either that, or a little like waiting for a bus you know that eventually one will come along, so you just keep on repeating the same message until it does.

 

 

Question No6 - you are bearish on the future direction of house prices, but until the last six months (ish) there had not been many signs of an actual downturn

 

Does that way of thinking go against your thoughts on the stock market?

 

Not having a "go" just a genuine question as to your thought process.

 

+ best wishes for 2011

[No6]

Question No6 - you are bearish on the future direction of house prices, but until the last six months (ish) there had not been many signs of an actual downturn

 

Does that way of thinking go against your thoughts on the stock market?

 

Not having a "go" just a genuine question as to your thought process.

 

+ best wishes for 2011

 

I'm bearish on house prices because the real fundamentals that drive them have changed dramatically in the last 3 years or so. For me, the most important factors in rising house prices from around 2001-2007 was the availabilty of loose mortgage credit and the range of mortgage products available, many of which were open to abuse and fraud which the lenders, regulators and Government turned a blind eye to. Although it is difficult to prove I do think that the temptation to tell a few white lies about income in order to buy a property or get on the ladder was probably widespread up to 2008. Only the credit crunch put an end to that as banks voluntarily withdrew all their questionable mortgage products and of course some lenders went bust. Despite this, there is still the mistaken belief that prices that went up on the back of this can somehow stay there and defy the economic reality that buyers now face. Without a return to the bad old days and ways, I cannot see how house prices can rise except on a lower number of total sales.

 

There is no doubt that rising house prices and the increase in spending on credit that went up on the back of it had an effect on the way the stock market looked at the general health of the UK economy. Going forward, one unknown is how the market will react to steady falling house prices, which so far has been controlled to some degree by Government and BoE intervention. However, the end result of this has so far seen falling number of sales rather than dramatic falls in prices as there is effectively a standoff between sellers still looking for a bubble price and buyers that cannot get the funding to feed it. The fact that the stock market hasn't fallen on the back of this would suggest that to some degree house price falls, provided that it is steady over time, may well have been priced into market thinking. In other words, as long as things muddle through the market may well largely ignore it as long as there is sufficient good news elsewhere in the world economy to keep recovery hopes alive.

 

The other point to understand, and it is one that I've mentioned many times on this thread, is that the FTSE is now very much an international index. If over the next few years the emphasis of the economy to grow is based on expanding markets abroad, then these companies with overseas exposure should do better and the general market may well overlook sluggish growth on the home front for a few years as the economy rebalances. I still feel that to a large degree the FTSE will follow the US markets and on that score I'm still inclined towards the upside for the markets rather than the bearish view that suddenly the market will come to its senses and realise that the libertarian Austrian economic thinking bears were right all along and drop share prices to 1930's levels. I don't buy that at all.

[littledavesab]

I'm bearish on house prices because the real fundamentals that drive them have changed

dramatically in the last 3 years or so.

 

Thanks for that No6. In my job I get to speak to IFAs' fairly regulary and did have chats

with ones I knew quite well during the bubble days re "liar loans". Their response was the

usual well its still cheaper than renting - difficult to argue with that point of view too much

when monthly gains was the order of the day. Also scratched my head at amatour BTL landlords with 7 properties, who's day job was a chef and paper value a couple of mill!!!

 

Also in the past had a job at a small ish firm mixed IFA / General Insurance business where during the mid-late 1990's clients would still thank me for the assistance the firm gave them in finding mortgages when loans were hard to get during the 1970's (first half 1970's ??). So thats the good and bad side of the IFA industry... Better not mention low cost endowments.....

 

I am sure that if (when?) we get high interest rates then the property market will be damaged but such is the general public's confidence in property as an investment vehicle - not to mention its usefulness re pension planning etc, I suspect we have a way to go yet

 

Sorry seriously off topic

 

The other point to understand, and it is one that I've mentioned many times on this thread,

is that the FTSE is now very much an international index. If over the next few years the

emphasis of the economy to grow is based on expanding markets abroad, then these companies with overseas exposure should do better and the general market may well overlook sluggish growth on the home front for a few years as the economy rebalances. I still feel that to a large degree the FTSE will follow the US markets and on that score I'm still inclined towards the upside for the markets rather than the bearish view that suddenly the market will come to its senses and realise that the libertarian Austrian economic thinking bears were right all along and drop share prices to 1930's levels. I don't buy that at all.

 

I concur. Would also point out that not only is it international but also a fair amount of

resource companies and PM miners are now included. From that point of view it is exposedto the emerging markets boom, the inflation trades etc.

 

I am trying to avoid the doomsters but a good time ago remember Bob Hoye saying that it is the investment in gold miners that re-starts the economy. Gawd hope we dont get that bad but the onwards and upwards march of the various oillies and miners through the indexes is food for thought in this respect.

[No6]

Thanks for that No6. In my job I get to speak to IFAs' fairly regulary and did have chats

with ones I knew quite well during the bubble days re "liar loans". Their response was the

usual well its still cheaper than renting - difficult to argue with that point of view too much

when monthly gains was the order of the day. Also scratched my head at amatour BTL landlords with 7 properties, who's day job was a chef and paper value a couple of mill!!!

 

Also in the past had a job at a small ish firm mixed IFA / General Insurance business where during the mid-late 1990's clients would still thank me for the assistance the firm gave them in finding mortgages when loans were hard to get during the 1970's (first half 1970's ??). So thats the good and bad side of the IFA industry... Better not mention low cost endowments.....

 

I am sure that if (when?) we get high interest rates then the property market will be damaged but such is the general public's confidence in property as an investment vehicle - not to mention its usefulness re pension planning etc, I suspect we have a way to go yet

 

Sorry seriously off topic

 

 

 

I concur. Would also point out that not only is it international but also a fair amount of

resource companies and PM miners are now included. From that point of view it is exposedto the emerging markets boom, the inflation trades etc.

 

I am trying to avoid the doomsters but a good time ago remember Bob Hoye saying that it is the investment in gold miners that re-starts the economy. Gawd hope we dont get that bad but the onwards and upwards march of the various oillies and miners through the indexes is food for thought in this respect.

 

I think it is also worth remembering that those sectors most closely associated with housing, the banks, property companies, construction, etc, and those that rely heavily on discretionary consumer spending, retailers (non food), some service industry, leisure (i.e. bookmakers), have been hit hard by the turndown and for the most part have not recovered as well as the more glamorous, sexy sectors of the moment like mining, oil, etc. Many companies in these run down sectors are on depression era P/E's! Some don't deserve it as they have survived the downturn quite well and are making money (as an aside I think that in the long term, bookmakers like William Hill and Ladbrokes are potentially dirt cheap right now when compared to the ratings of other companies in the FTSE 250, but they are out of favour. I wouldn't be a buyer right now, but I can see them exploding to the upside at some time in the future. As always, people should DYOR). So, the market has punished these sectors, just as right now, companies overexposed to the public sector spending cuts have been punished and marked well down in many cases.

 

As for IR's, I'm not really convinced of a big move up in rates will happen quickly unless the CPI inflation rate somehow shoots up. The BoE have already shown that they are quite happy ignoring inflation and only a big rise that looks like staying put is likely to put them off the low IR policy. Having said that, the next step for IR's is up, but I think they are more likely to do it in baby steps, which has basically been the policy of the last 10 years. So, 1 - 1.5% by end of year, each rise being by 25 basis points sounds about right going by how the BoE behaves.

 

Bob Hoye's comment on Gold Miners leading the way? I'd like to see some analysis on whether that is what really happens based on history. Most of the UK goldminers are on AIM, but the odd one or two in the FTSE350 like Fresnillo (mainly silver), African Barrick, Hochschild Mining, etc have been going great guns recently. Ironic, but even though the FTSE is up around 140 as I write, Randgold Resources is one of the few stocks down today.

[No6]

UK Christmas Shopping Tracker 4: Some bad news today from Next and HMV. Interesting how the media are headlining this, but the retailing good news from the other day was largely ignored.

 

HMV to close 60 stores as snow hits sales

 

High street music chain HMV is to close 60 stores over the coming year as the company issued a profits warning that said snow troubles ‘significantly undermined’ trade.

 

http://www.telegraph.co.uk/finance/newsbys...hits-sales.html

 

Next lost £22m to December snow, warns over 'uncertain' 2011

 

The pre-Christmas snow and freezing conditions cost Next £22m in lost sales, the retail group said in a trading statement on Wednesday.

 

http://www.telegraph.co.uk/finance/newsbys...rtain-2011.html

 

On the other hand, Tesco's CEO is fairly bullish.

 

TESCO chief Sir Terry Leahy hit back at doom merchants yesterday by insisting the UK's economic recovery was GATHERING pace.

 

The veteran boss said the supermarket giant was seeing a different picture to that dominated by fears of cuts and austerity.

 

Sales of upmarket food range Tesco Finest have soared more than ten per cent since the crunch of two years ago.

 

And like-for-like growth in the UK - takings at stores open for more than a year - was 1.5 per cent in the three months to November 27, topping City forecasts.

 

http://www.thesun.co.uk/sol/homepage/news/...h-the-doom.html

[No6]

Christmas on the high street: retail winners and losers

 

http://www.guardian.co.uk/business/interac...trading-updates

[No6]

Share watch 2011: I thought I would try a little experiment. I've picked a few bombed out shares to follow for 2011. None of these should be seen as tips or that I have any interest in owning them, I just want to follow what happens to them over a 12 month period and track their performance. I've picked them because they rely on the UK consumer. If the share price of these pick up then maybe we really do have a full on recovery.

 

HMV - 25.50p

Dixons Retail - 23.71p

Cable & Wireless Communictions - 49.61p

Debenhams - 73.80p

Punch Taverns - 76.05p

 

 

[No6]

UK Christmas Shopping Tracker 5:

 

John Lewis has 'outstanding' Christmas

 

Date: Wednesday 05 Jan 2011

 

John Lewis brushed off the snow to grow like for like sales by 7.6% in the five weeks to 1 January as shoppers snapped up televisions, computers and furniture before yesterday’s VAT hike.

 

Total sales, which include new floor space, jumped 8.9% to £545m, with the electricals and home technology department up 14.4%, fashion up 8.7% and the home division up 4.7%.

 

"Sales during both Christmas and clearance have been outstanding,” managing director Andy Street said. “We have broken records for the biggest week (£121m) and biggest day (£27.8m) as well as hitting a key milestone (£500m for the year) for our online trade."

 

http://www.digitallook.com/news/3948130/Jo...d&ac=214484

[No6]

Well, I found this quite interesting.

 

FINANCIALS ARE STILL PLAYING THE BREAKOUT GAME

 

The bulls are working to end the long sideways saga of XLF.

 

A few times last year, we checked in with the action in XLF, the big financial stock fund. With large weightings in giants like JPMorgan, Goldman Sachs, Wells Fargo, American Express, and Bank of America, this fund rises and falls with America's ability to earn money, invest money, service debts, launch new businesses, and generally just "get along."

 

In 2009, XLF enjoyed a big rebound off its credit-panic lows. But in August that year, the uptrend stalled out and turned into a long period of sideways trading action. It's still drifting sideways... though in the past few months, the bulls have managed to push XLF past $16 per share. It's now in the upper reaches of this big sideways pattern.

 

XLF's holdings are the backbone of our banking and credit system... so its share price is a good clue to what's really happening in the economy, no matter what politicians or CNBC commentators are blathering about. Money talks and you-know-what walks. You can listen in with XLF. Right now, it's starting to say "higher prices for me."

 

http://www.dailywealth.com/1595/The-Most-A...-I-ve-Ever-Seen

[John Doe]

I'm a bit sceptical of this rally now, shorted dow at 11750 with a 60tick stop

[John Doe]

I'm a bit sceptical of this rally now, shorted dow at 11750 with a 60tick stop

Wow, hit my limit already, and fell a bit further too, still I'm not going to be greedy (it was only a £1 a tick play bet anyway).

 

Hope this is the start of the correction I'm looking for, so I can load up my long term account.

[Vicarious]

Me too, sold down my gold / silver stocks a few weeks ago and its been sat in cash waiting for an entry point into some good dividend paying stocks, Ive been looking at aviva and Linn Energy. Aviva seemed to be tipped in alot of the year end newspaper financial reviews and has done well since then sadly.

[DontPanic]

Excellent thread, No6 - especially now you have started posting again.

 

I have had a long holiday from GEI, not the least because I felt the views on the whole were too bearish and didn't allow for an opposing bullish view however illogical or unreasonable from a fundamental perspective. It seemed to me (and I think I've been proved right) that QE really screws the game and therefore fundamentals get thrown out the window.

 

I've made 150% returns in equities over the past 9 months on positions I would not have taken if I had been fully convinced by the overwhelmingly bearish views posted here. Not that I don't fundamentally agree - I do - but I think the warnings were before their time.

 

However, I've just sold all my shares and am back reading here (and this is my first post since my absence) because my gut instinct is warning me that equities cannot continue to rise on hot air.

 

I have a strong feeling that things are coming to a head again; I'm expecting another SM crash, tbh. I don't know when - maybe tomorrow, maybe next week, maybe next month. But I'm concerned enough to bank profits and stay in cash for a while.

 

For the same reasons as above this is my first post for a very long time.

Fortunately I ignored the bears and bought through the crash and beyond. Mainly steel / engineering companies like Sandvik, ABB, SSAB which were hit hard but rebounded back in large part due to exports to developing markets and demand for mining equipment.

Many of these were via options which expire in a few months time. I dont think I will give up on equities but rather reduce the risk and buy something boring like an S&P 500 or Euro Stoxx trackers which have reasonable PEs. If there is another crash of ca. 20% I would consider selling the trackers and buying more risky stock.

 

Thanks for posting No.6 !!