Perhaps it was his comments today that “a construction boom is coming… tune out the noise and enjoy the bull market” due to lower oil costs and improving weather; but it appears JPMorgan and the permabull are about to part company after 15 years:
- *JPMORGAN U.S. CHIEF EQUITY STRATEGIST THOMAS LEE DEPARTS FIRM
- *JPMORGAN ANNOUNCES LEE’S DEPARTURE IN INTERNAL MEMO
It is unclear if Lee’s next career will be as waterboy for Ben Bernanke on his $250,000/speech global speech tour. What is, however, likely is that in his place JPM will simply unleash an algorithm that keeps raising JPM’s “official” S&P500 price target to 100 points above wherever the S&P may be at any given moment.
14 August 2013 - 14:11 pm
F1Q14 PAT of Rs32.4bn was supported by stable NIMs, high capital gains and lower provisions despite a sharp spike in NPLs (coverage fell). But,these are unsustainable, in our view. Higher costs and provisioning will make it tough to deliver headline earnings. Stay Underweight.F1Q14 headline earnings were better than MSE: PAT (-14% YoY) was 6% above on lower provisions. Core PPoP (adjusted for longevity-related pension costs) was
3% below our estimate. Impairments spiked to 7.5% of loans (annualized). Coverage fell to 51% from 57%.Average PAT over the next three quarters is unlikely to be materially >Rs20bn: This will be driven by weaker asset quality (51% coverage and huge impaired loan formation); likely fall in NIMs (falling spreads/LD ratio); rising opex and higher bond yields (MTM losses of ~Rs13bn according to management).
Balance sheet is weakening faster than expected:
Impaired loans rose to 8.6% of loans (7.7% last quarter),with deterioration across all sectors despite stable macro conditions in F1Q14. Given sluggish growth and rising rates, asset quality is likely to get worse. Low coverage at 51% of NPLs (even lower on impaired loans) will keep provisioning higher for longer. Impaired loans stock will keep rising as ability to write off NPLs will be limited – we now project 10% in FY14 and 11.5% FY15 (vs. 9.3% and 10.5% previously). Capital (common equity Tier 1 ratio) at 8.9% in this context is low. >> Read More
The Bank of Japan Thursday raised its assessment of local economies in eight out of nine regions, adding to signs of a recovery in the country’s economy as solid domestic demand takes hold.
“Domestic demand has increased in its resilience on the back of an improvement in household and business sentiment, while overseas demand is heading toward a pickup,” the central bank said in its quarterly regional economic report.
In the previous report in April, the central bank raised its view of all nine regions. >> Read More
If you are just randomly trading what you like with no real underlying system, method or planning then unfortunately your odds of success in the long term are slim. Trading a winning methodology is what creates an edge in trading.
Consistently trading a robust system or methodology enables you to trade in a way that historically wins, controls risk, and does not bring your ego and your emotions into your trading in a destructive way.
Ten questions to ask yourself before every trade:
- Does this trade fit my chosen trading style? Whether it is: swing trading, momentum, break out, trend following, reversion to the mean, or day trading?
- How big of a position do I want to trade? How much capital am I going to risk? Am I limiting my risk to 1% or 2% of my trading capital?
- What is my risk of ruin based on my capital at risk?
- Why am I entering the trade here? What is the trigger to trade?
- How will I exit with a profit? A price target or trailing stop? >> Read More
Gold first entered a bear market in April, and the recent rout has seen the precious metal break below the $1,200 level this week.
Adam Grimes, CIO at Waverly Advisors told Business Insider that market participants have stop orders beyond visible support points in the market.
“[The sell off in mid-April] was quite likely driven by a cluster of these orders, and we believe that more are probably lurking lower,” he said.
A stop order is an order to sell a position if price fall to a certain level.
Here’s more from our conversation with Grimes. >> Read More
And just to add one more embarrassing detail for them, while section 4 discusses “Japan’s recent policy actions,” not only does Canada’s finance minister James Flaherty believe they “didn’t discuss the Japanese Yen,” but Japan’s Kuroda believes, comments on ‘misalignments’, “were not meant for the BoJ.”
- *KURODA SAYS TOLD G-20 JAPAN’S EASING TO ACHIEVE PRICE TARGET
- *ASO SAYS G-20 UNDERSTANDS BOJ EASING IS TO END DEFLATION
- *KURODA SAYS IT WAS GOOD JAPAN WON UNDERSTANDING FROM G-20
- *KURODA SAYS G-20 UNDERSTANDS EASING NEEDED FOR PRICE STABILITY
- *KURODA: G-20 AGREEMENT GAVE HIM CONFIDENCE TO CONTINUE EASING
- *ASO SAYS BOJ EASING IS IN LINE WITH WHAT G-20 AGREED
It seems “Forward Progress” is an important subliminal phrase…
Meeting of Finance Ministers and Central Bank Governors
Washington, 18-19 April 2013 >> Read More
Goldman Sachs Chief U.S. Equity Strategist David Kostin is bumping up the bank’s year-end S&P 500 price target to 1625 from 1575.
In a note to clients this morning, Kostin writes, “The 2013 US equity market story is becoming one of improving business activity accompanied by increased CEO confidence,” pointing to recent positive surprises in employment, manufacturing, and retail sales data.
Accompanying all of that is a forecast for 2 percent GDP growth in 2013 and 2.9 percent growth in 2014, with 10-year Treasury yields rising to 2.5 percent by the end of the year and 3.0 percent by the end of 2014.
“The ‘sequester’ has begun and the federal government is still functioning,” says Kostin.
Below is Goldman’s thesis: >> Read More