alingtonsky
Forumer storico
Published: April 8, 2016 5:00 p.m. ET
Ellie Ismailidou
After a dismal start to the year for equities followed by an equally strong rebound that took stocks to their 2016 highs earlier this week, some analysts now contend that the stock market rally may have hit its ceiling.
On Friday, as stocks eked out modest gains, boosted by a surge CLK6, +6.44% in oil prices, Bank of America Merrill Lynch analysts joined the camp urging investors to start selling this rally.
In a note headlined “Sayonara bears”—using the Japanese word for goodbye—the analysts explained that the extreme risk aversion of the beginning of the year has all but vanished—but that this bullish shift isn't warranted by fundamentals.
Emerging-market debt sees largest 7-week inflow since 2014
The biggest worries for credit investors are no longer the macro themes of an emerging-market and China slowdown, the analysts said. As a result, inflows to emerging-market bond funds, which are typically considered very risky investments, accelerated this week to $1.97 billion from $380 million last week.
Overall, a total of $2 billion have flown into emerging-market bond funds over the past seven weeks—the largest inflow since June 2014.
Investors buy junk bonds, sell haven assets
Flows in the bond market showed the spike in risk appetite. As investors bought high-yield, also known as junk, bonds and emerging-market debt, they sold government-bond funds, such as Treasurys, which are typically viewed as haven assets and defensive plays. As the 10-year Treasury yield TMUBMUSD10Y, +1.85% the Treasury market’s benchmark, rebounded from an eight-week low, outflows form government-bond funds intensified to $1.51 billion from $930 million in the prior week.
Earnings decline for third straight quarter
First-quarter earnings season kicks off next week, with 9% of S&P 500 SPX, +0.28% companies expected to report, dominated by banks. Analysts expect a third straight quarter of negative earnings growth, marked by a 9% year-over-year decline, the analysts said. Excluding energy, analysts expect a 4% year-over-year decline.
These 4 charts say it’s time to sell the rally
Traduttore Inglese Italiano
Reverso | traduttore, traduzione inglese, significato, dizionario
Ellie Ismailidou
After a dismal start to the year for equities followed by an equally strong rebound that took stocks to their 2016 highs earlier this week, some analysts now contend that the stock market rally may have hit its ceiling.
On Friday, as stocks eked out modest gains, boosted by a surge CLK6, +6.44% in oil prices, Bank of America Merrill Lynch analysts joined the camp urging investors to start selling this rally.
In a note headlined “Sayonara bears”—using the Japanese word for goodbye—the analysts explained that the extreme risk aversion of the beginning of the year has all but vanished—but that this bullish shift isn't warranted by fundamentals.
Emerging-market debt sees largest 7-week inflow since 2014
The biggest worries for credit investors are no longer the macro themes of an emerging-market and China slowdown, the analysts said. As a result, inflows to emerging-market bond funds, which are typically considered very risky investments, accelerated this week to $1.97 billion from $380 million last week.
Overall, a total of $2 billion have flown into emerging-market bond funds over the past seven weeks—the largest inflow since June 2014.
Investors buy junk bonds, sell haven assets
Flows in the bond market showed the spike in risk appetite. As investors bought high-yield, also known as junk, bonds and emerging-market debt, they sold government-bond funds, such as Treasurys, which are typically viewed as haven assets and defensive plays. As the 10-year Treasury yield TMUBMUSD10Y, +1.85% the Treasury market’s benchmark, rebounded from an eight-week low, outflows form government-bond funds intensified to $1.51 billion from $930 million in the prior week.
Earnings decline for third straight quarter
First-quarter earnings season kicks off next week, with 9% of S&P 500 SPX, +0.28% companies expected to report, dominated by banks. Analysts expect a third straight quarter of negative earnings growth, marked by a 9% year-over-year decline, the analysts said. Excluding energy, analysts expect a 4% year-over-year decline.
These 4 charts say it’s time to sell the rally
Traduttore Inglese Italiano
Reverso | traduttore, traduzione inglese, significato, dizionario