T-Bronx5Y-10Y-Bund .. la notte dei morti viventi (vm18)
- Creatore Discussione Fernando'S
- Data di Inizio
detto così è un pò azzardato
quicksilver
Forumer storico
giomf ha scritto:
no, libero come il vento
gipa69
collegio dei patafisici
Alcuni interessanti articoli sui mercati....
The Mystery of the Disappearing Stocks
A bizarre explanation for the stock market rally.
By Daniel Gross
Updated Monday, Nov. 20, 2006, at 4:25 PM ET
The continuing stock rally in the face of a slowing economy and a cratering housing sector is something of a mystery, baffling economists and investors alike. But there could be a simple explanation: supply and demand.
Simply put, the supply of U.S. stocks available for individual investors, mutual funds, and index funds. Call it de-equitization. In the last few days, deals have been announced or concluded to take large publicly held companies private. HCA, the giant hospital chain, last Thursday announced the completion of its $21.2 billion leveraged buyout. The same day, Reader's Digest said it would be acquired by private equity firm Ripplewood Holdings for $2.4 billion. This morning, Equity Office Properties, the huge real estate company, struck a deal to be acquired by the Blackstone Group for $19 billion. (Throw in the value of Equity Office's debt, and it may be the biggest LBO ever.) At the same time, publicly held firms are buying back big chunks of their shares. Last Friday, Wendy's said it would spend $800 million buying 19 percent of its outstanding shares.
This year is shaping up to be a record for both leveraged buyouts and stock buybacks. According to Thomson Financial, buyouts worth $334.5 billion have been announced or completed so far this year, up from $115 billion for all of last year. According to Standard & Poor's, members of the S&P 500 Index spent $325.15 billion on their own shares in the first three quarters of 2006 and have spent more than $674 billion since Jan. 1, 2005. Between buybacks and buyouts, that's more than $1.1 trillion of stock taken out of public hands in less than two years.
Of course, new shares are constantly being created, through secondary offerings of existing companies and initial public offerings. But these tend to come in much smaller batches, as this list of recent IPOs shows—a few hundred million here and there. According to Dealogic, IPO volume has totaled about $36 billion so far this year. IPOs are on track for an excellent year, but the money raised by this new supply of shares pales in comparison to the volume of buybacks and LBOs. And many of the world's biggest IPOs now take place in Hong Kong and London—which means they're off-limits to many American investors and mutual funds.
Given the size of the U.S. capital markets, it takes a big supply cut to move the market. But the scale of recent buybacks and LBOs may be enough. This morning, the market capitalization of the New York Stock Exchange Composite Index was $21.77 trillion, while that of the Nasdaq Composite Index was $4.22 trillion. Taking out one, or two, or three blue-chip companies doesn't make that much of a dent in a $25 trillion marketplace. But it adds up. If leveraged buyouts and buybacks add up to $1 trillion for the year, which is entirely possible, that's about 4 percent of the combined capitalization of all NYSE and Nasdaq stocks.
Clearly buybacks and buyouts make a difference to an individual stock. Investors value stocks in part based on earnings per share. And when the same profits are distributed over a smaller number of shares, earnings per share rise, making the stocks look more attractive.
Psychology also plays an important role in stock valuation. And, here again, the de-equitization trend may be spurring higher valuations. Companies, which have enjoyed a record run of profits, still have lots of cash sitting on their balance sheets—and investors believe they could use that cash to buy back more stock. Members of the S&P 500 collectively had $611 billion in cash as of Sept. 30. Meanwhile, data from the National Venture Capital Association show that so far this year, buyout funds have raised $84 billion, compared with $96 billion for all of 2005, and $25 billion in 2002. So, investors now buy stocks with a reasonable expectation that (a) the company might buy more shares back from them, or (b) a private equity firm might offer a premium to take the company private. Both results, which reduce the supply of shares, create higher stock prices. In other words, investors may be buying stocks—and driving up prices—in anticipation of buybacks or LBOs that would push up prices even more. The presence of deep-pocketed corporate and private equity buyers standing at the ready creates what Citigroup strategist Tobias Levkovich calls "an underlying bid," which tends to dampen volatility and stop prices from falling too far. And it tends to scare away short-sellers.
Extrapolating from existing trends is always a dangerous trap for investors. But if current trends continue, stocks may join oil, textile plants, and moderate Republicans as formerly abundant national resources that are in increasingly short supply.
The Mystery of the Disappearing Stocks
A bizarre explanation for the stock market rally.
By Daniel Gross
Updated Monday, Nov. 20, 2006, at 4:25 PM ET
The continuing stock rally in the face of a slowing economy and a cratering housing sector is something of a mystery, baffling economists and investors alike. But there could be a simple explanation: supply and demand.
Simply put, the supply of U.S. stocks available for individual investors, mutual funds, and index funds. Call it de-equitization. In the last few days, deals have been announced or concluded to take large publicly held companies private. HCA, the giant hospital chain, last Thursday announced the completion of its $21.2 billion leveraged buyout. The same day, Reader's Digest said it would be acquired by private equity firm Ripplewood Holdings for $2.4 billion. This morning, Equity Office Properties, the huge real estate company, struck a deal to be acquired by the Blackstone Group for $19 billion. (Throw in the value of Equity Office's debt, and it may be the biggest LBO ever.) At the same time, publicly held firms are buying back big chunks of their shares. Last Friday, Wendy's said it would spend $800 million buying 19 percent of its outstanding shares.
This year is shaping up to be a record for both leveraged buyouts and stock buybacks. According to Thomson Financial, buyouts worth $334.5 billion have been announced or completed so far this year, up from $115 billion for all of last year. According to Standard & Poor's, members of the S&P 500 Index spent $325.15 billion on their own shares in the first three quarters of 2006 and have spent more than $674 billion since Jan. 1, 2005. Between buybacks and buyouts, that's more than $1.1 trillion of stock taken out of public hands in less than two years.
Of course, new shares are constantly being created, through secondary offerings of existing companies and initial public offerings. But these tend to come in much smaller batches, as this list of recent IPOs shows—a few hundred million here and there. According to Dealogic, IPO volume has totaled about $36 billion so far this year. IPOs are on track for an excellent year, but the money raised by this new supply of shares pales in comparison to the volume of buybacks and LBOs. And many of the world's biggest IPOs now take place in Hong Kong and London—which means they're off-limits to many American investors and mutual funds.
Given the size of the U.S. capital markets, it takes a big supply cut to move the market. But the scale of recent buybacks and LBOs may be enough. This morning, the market capitalization of the New York Stock Exchange Composite Index was $21.77 trillion, while that of the Nasdaq Composite Index was $4.22 trillion. Taking out one, or two, or three blue-chip companies doesn't make that much of a dent in a $25 trillion marketplace. But it adds up. If leveraged buyouts and buybacks add up to $1 trillion for the year, which is entirely possible, that's about 4 percent of the combined capitalization of all NYSE and Nasdaq stocks.
Clearly buybacks and buyouts make a difference to an individual stock. Investors value stocks in part based on earnings per share. And when the same profits are distributed over a smaller number of shares, earnings per share rise, making the stocks look more attractive.
Psychology also plays an important role in stock valuation. And, here again, the de-equitization trend may be spurring higher valuations. Companies, which have enjoyed a record run of profits, still have lots of cash sitting on their balance sheets—and investors believe they could use that cash to buy back more stock. Members of the S&P 500 collectively had $611 billion in cash as of Sept. 30. Meanwhile, data from the National Venture Capital Association show that so far this year, buyout funds have raised $84 billion, compared with $96 billion for all of 2005, and $25 billion in 2002. So, investors now buy stocks with a reasonable expectation that (a) the company might buy more shares back from them, or (b) a private equity firm might offer a premium to take the company private. Both results, which reduce the supply of shares, create higher stock prices. In other words, investors may be buying stocks—and driving up prices—in anticipation of buybacks or LBOs that would push up prices even more. The presence of deep-pocketed corporate and private equity buyers standing at the ready creates what Citigroup strategist Tobias Levkovich calls "an underlying bid," which tends to dampen volatility and stop prices from falling too far. And it tends to scare away short-sellers.
Extrapolating from existing trends is always a dangerous trap for investors. But if current trends continue, stocks may join oil, textile plants, and moderate Republicans as formerly abundant national resources that are in increasingly short supply.
gipa69
collegio dei patafisici
La stagionalità prossima futura...
November 21, 2006, 10:03 am
Borrowing from Santa
Posted by David Gaffen
Some analysts have surmised lately that because the stock market has put together such an impressive rally in the last couple of months, investors may have “borrowed” from gains usually witnessed in December, which, since 1950, has been the best performing month of the year for the Standard & Poor’s 500-stock index and second-best for the Dow Jones Industrial Average, according to the Stock Trader’s Almanac.
Bunk, say analysts at Birinyi Associates. Going back to 1942, when Thanksgiving Day became a market holiday, in years when the Dow’s gains surpassed 10% from the end of the second quarter to the start of Thanksgiving week, the Dow has done better in the remaining weeks of the year than in other years. The average change between Thanksgiving week and the end of the year is 2.34%; in the 11 years of a 10% gain between July 1 and Thanksgiving week, the Dow has gained 3.09%, and only lost ground twice, in 1980 and 1996.
The data is more supportive of the notion of “borrowing” gains from December when the starting date is the end of the third quarter. In the 16 instances where the Dow has gained 5% between Oct. 1 and Thanksgiving week, the Dow is usually up 1.51% through the rest of the year, compared with the 2.34% average gain.
November 21, 2006, 10:03 am
Borrowing from Santa
Posted by David Gaffen
Some analysts have surmised lately that because the stock market has put together such an impressive rally in the last couple of months, investors may have “borrowed” from gains usually witnessed in December, which, since 1950, has been the best performing month of the year for the Standard & Poor’s 500-stock index and second-best for the Dow Jones Industrial Average, according to the Stock Trader’s Almanac.
Bunk, say analysts at Birinyi Associates. Going back to 1942, when Thanksgiving Day became a market holiday, in years when the Dow’s gains surpassed 10% from the end of the second quarter to the start of Thanksgiving week, the Dow has done better in the remaining weeks of the year than in other years. The average change between Thanksgiving week and the end of the year is 2.34%; in the 11 years of a 10% gain between July 1 and Thanksgiving week, the Dow has gained 3.09%, and only lost ground twice, in 1980 and 1996.
The data is more supportive of the notion of “borrowing” gains from December when the starting date is the end of the third quarter. In the 16 instances where the Dow has gained 5% between Oct. 1 and Thanksgiving week, the Dow is usually up 1.51% through the rest of the year, compared with the 2.34% average gain.
gipa69
collegio dei patafisici
Altro sulla stagionalità...
Stock investors give thanks
Two days around U.S. Thanksgiving are the best of year
Two of the strongest days of the year for U.S. equity markets are the day before U.S. Thanksgiving Day and the day after U.S. Thanksgiving.
A report by Brooke Thackray, one of Canada's top seasonality analysts on U.S. equity markets, notes that the strategy has been profitable 85.7% of the time since 1950. Average return per period for the S&P 500 index for the two days of trading was 0.80%.
TSX-composite-index data during the U.S. Thanksgiving-rally period also is positive. The TSX composite index since its relaunch in March, 2000, has advanced in six of the past six periods, for an average gain per period of 1.96%.
Two recurring events help to explain the phenomenon:
- Individual investors dominate the trading on Wednesday, the day before U.S. Thanksgiving, and Friday, the day after U.S. Thanksgiving. Most institutional investors and market makers close their books at midday on Wednesday, the day before Thanksgiving. They take an extended long weekend, including a holiday on Friday, the day after Thanksgiving.
- Individual investors are in a buoyant pre-Christmas mood. Thanksgiving Day in the United States is the start of the Christmas shopping season. Historically, Thanksgiving Day is the busiest shopping day of the Christmas season.
Technicals Seasonal strength occurs at a time of the year when U.S. markets normally move higher. Arrows on the chart of the S&P 500 index show the timing of the Thanksgiving rally during each of the past five periods.
Fundamentals Prospects for the Thanksgiving rally in U.S. and Canadian equity markets from this Wednesday to this Friday are higher than average this year. U.S. retailers already are offering consumer-electronic goods at discount prices. Last week, Wal-Mart began selling 42-inch flat screen televisions in the United States for less than $1,000. Bargains will put U.S. consumers and individual investors into a bullish mood.
How to invest The preferred strategy is to defer the sale of stocks, exchange-traded funds and mutual funds until after the U.S. Thanksgiving rally period.
Stock investors give thanks
Two days around U.S. Thanksgiving are the best of year
Two of the strongest days of the year for U.S. equity markets are the day before U.S. Thanksgiving Day and the day after U.S. Thanksgiving.
A report by Brooke Thackray, one of Canada's top seasonality analysts on U.S. equity markets, notes that the strategy has been profitable 85.7% of the time since 1950. Average return per period for the S&P 500 index for the two days of trading was 0.80%.
TSX-composite-index data during the U.S. Thanksgiving-rally period also is positive. The TSX composite index since its relaunch in March, 2000, has advanced in six of the past six periods, for an average gain per period of 1.96%.
Two recurring events help to explain the phenomenon:
- Individual investors dominate the trading on Wednesday, the day before U.S. Thanksgiving, and Friday, the day after U.S. Thanksgiving. Most institutional investors and market makers close their books at midday on Wednesday, the day before Thanksgiving. They take an extended long weekend, including a holiday on Friday, the day after Thanksgiving.
- Individual investors are in a buoyant pre-Christmas mood. Thanksgiving Day in the United States is the start of the Christmas shopping season. Historically, Thanksgiving Day is the busiest shopping day of the Christmas season.
Technicals Seasonal strength occurs at a time of the year when U.S. markets normally move higher. Arrows on the chart of the S&P 500 index show the timing of the Thanksgiving rally during each of the past five periods.
Fundamentals Prospects for the Thanksgiving rally in U.S. and Canadian equity markets from this Wednesday to this Friday are higher than average this year. U.S. retailers already are offering consumer-electronic goods at discount prices. Last week, Wal-Mart began selling 42-inch flat screen televisions in the United States for less than $1,000. Bargains will put U.S. consumers and individual investors into a bullish mood.
How to invest The preferred strategy is to defer the sale of stocks, exchange-traded funds and mutual funds until after the U.S. Thanksgiving rally period.
gipa69
collegio dei patafisici
Un interessante parere contrarian sulla stagionalità...
This Party May End Before It Starts
By CONRAD DE AENLLE
Published: November 19, 2006
THE stock market has had a great run over the last few months, but as the holiday season begins, some analysts are worrying that the traditional year-end rally on Wall Street may have already come and nearly gone.
Mary Ann Bartels, technical research analyst at Merrill Lynch, wondered in a note to investors whether the tendency for stocks to climb in the last couple of months of the year had been rescheduled this year for September and October.
“We think yes,” she wrote. She then acknowleged feeling torn between what her charts have told her and what the calendar and history have led her to expect.
“It is not our favored stance to be more toward the bear camp looking for a cyclical correction of 8 to 10 percent, but all of the market indicators suggest this is the more likely scenario over the coming weeks,” Ms. Bartels said. “What is surprising is that these readings are occurring at this time of year. Most years see a bullish year-end rally.”
She highlighted several exceptions that prove the rule, including three years in the 1990s when the Standard & Poor’s 500-stock index lost at least 6 percent at some point during the last two months of the year. What signs suggest that 2006 will play out as those three years — 1991, 1994 and 1996 — did?
Trading volume has shrunk, something that often precedes a price decline, she noted, and several sentiment indicators, including opinion surveys of investment advisers and measures of market volatility, show the sort of complacency that typically occurs near market tops.
She also detected a “barbell strategy” among investors, favoring emerging markets on one end and defensive, high-quality American blue chips on the other while ignoring the moderately risky stuff in between. That is similar to the pattern last spring, just before the market took a tumble.
These warning flags lead Ms. Bartels to forecast a decline in the S.& P. 500 to as low as 1,260 from its close on Friday of 1,401.20 “All technical signs are pointing to the markets nearing a consolidation period and not a blowoff to the upside,” she said. “We cannot rule out further upside, but the risk/reward warrants a more defensive stance.”
DATA WATCH Few economic reports are on the business calendar, which is shortened this week by Thanksgiving on Thursday.
One report that may attract interest on Monday is the index of leading economic indicators for October. A Bloomberg News poll of economists forecasts an increase of 0.2 percent after a 0.1 percent climb for September.
On Wednesday, the University of Michigan will issue its revised consumer sentiment report for November. The Bloomberg poll forecasts a reading of 93.1, up from the provisional reading of 92.3.
This Party May End Before It Starts
By CONRAD DE AENLLE
Published: November 19, 2006
THE stock market has had a great run over the last few months, but as the holiday season begins, some analysts are worrying that the traditional year-end rally on Wall Street may have already come and nearly gone.
Mary Ann Bartels, technical research analyst at Merrill Lynch, wondered in a note to investors whether the tendency for stocks to climb in the last couple of months of the year had been rescheduled this year for September and October.
“We think yes,” she wrote. She then acknowleged feeling torn between what her charts have told her and what the calendar and history have led her to expect.
“It is not our favored stance to be more toward the bear camp looking for a cyclical correction of 8 to 10 percent, but all of the market indicators suggest this is the more likely scenario over the coming weeks,” Ms. Bartels said. “What is surprising is that these readings are occurring at this time of year. Most years see a bullish year-end rally.”
She highlighted several exceptions that prove the rule, including three years in the 1990s when the Standard & Poor’s 500-stock index lost at least 6 percent at some point during the last two months of the year. What signs suggest that 2006 will play out as those three years — 1991, 1994 and 1996 — did?
Trading volume has shrunk, something that often precedes a price decline, she noted, and several sentiment indicators, including opinion surveys of investment advisers and measures of market volatility, show the sort of complacency that typically occurs near market tops.
She also detected a “barbell strategy” among investors, favoring emerging markets on one end and defensive, high-quality American blue chips on the other while ignoring the moderately risky stuff in between. That is similar to the pattern last spring, just before the market took a tumble.
These warning flags lead Ms. Bartels to forecast a decline in the S.& P. 500 to as low as 1,260 from its close on Friday of 1,401.20 “All technical signs are pointing to the markets nearing a consolidation period and not a blowoff to the upside,” she said. “We cannot rule out further upside, but the risk/reward warrants a more defensive stance.”
DATA WATCH Few economic reports are on the business calendar, which is shortened this week by Thanksgiving on Thursday.
One report that may attract interest on Monday is the index of leading economic indicators for October. A Bloomberg News poll of economists forecasts an increase of 0.2 percent after a 0.1 percent climb for September.
On Wednesday, the University of Michigan will issue its revised consumer sentiment report for November. The Bloomberg poll forecasts a reading of 93.1, up from the provisional reading of 92.3.
Similar threads
