Thursday , August 18 2022

The correction of 5% to 10% is essential for this stock market, warns Jefferies strategist



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Are we close to a point where we will finally see how much juice is left in this stock market of a trade deal announcement?

There is a report that U.S. negotiators and a Chinese working hard for a "multiple memorandum of understanding" for one big deal that gave a nice pump to the future of stock on Wednesday late. But those earnings came into a Thursday session, which raises the question of whether the market is lasting for the seemingly endless discussions between Beijing and # 39; r US

Another valid question is how do we even know which stock has "pricing in" that front? Two financial bloggers, Michael Brown, Josh Brown and Investor N / A Michael Batnick, had wandered over that topic in a recent video chat. They concluded that investors would be wise to make any assumptions as to whether a market has absorbed full commercial, corporate marks, etc.

"I believe that that is the commentary to address what is happening in the market," said Batnick. "As if you knew the hard things … you do not know. You'll find it after the fact."

We are also quite thinking that the Fed will not get more stock earnings. As the Real Heiseinberg blog summarizes, it's more or less a "what-do-you-want-to-you."

Due to serious gravity as this post-Christmas bounce looks, the bulls have one more in their corner: the AD (advancer / decliner) line is often called high – more stock rises does not fall – which means you can cast apart from dark thoughts of equity interference. For now.

That does not mean that it should not happen, says ours call per day from Steven DeSanctis, an equity strategist in Jefferies who tells MarketWatch that he can not see "sustainable momentum" in the stocks up for stock since the beginning of the year.

"Consolidation, restoration is absolutely necessary," said DeSanctis at a telephone interview on Wednesday. For example, Russell 2000 says

RUT, + 0.46%

above 16.5% since the beginning of the year, the third best start in data that extends back to 1979.

"Anytime you see a large gathering, that's usually being met. It would be welcome to correct from 5% to 10%, and it would be justified," he said. ; r strategist, adding that there is enough that could trigge that trigger that correction – slow down in China, Europe or the US, lower earnings estimates, decrease in profits, withdrawals.

That last point is a big reason that she would like to see some froth coming off the market. S & P 500 companies currently trade up to 19.8 times onwards, he says. That compares to 20 times last August and 16 times at the end of 2018. Having seen that level dropped to 17 times would mean that stocks look much more attractive at the moment , he said.

Still DeSanctis claims that there was no justification for the late repayment last year "because we do not see this economy in the United States going into a recession," adding that their "happy-lucky" economist only reduced by a small drop in GDP for 2020 against 2019. Beautiful results from Walmart

WMT, -2.27%

this week but has gone further to calm his worries about the economy, he said.

That brings us to the stocks that he likes at the moment. "I say that my favorite sector is optional for consumers and retailers. This argument is that the economy will grow from those consumers' side of things," he says, stating that people have jobs and earn more money, arguments against brewing recession.

"The general trend has been very good for the user," says DeSanctis, adding that "what the companies are saying is generally & The user is in a very good shape. "

Also read: A $ 3 billion tsunami is on the verge of the stock market flood, warns the fund manager

The market

Dow

YMH9, -0.13%

, S & P 500

ESH9, -0.18%

a Nasdaq

NQH9, -0.11%

the future is close up. During the Wednesday session there were moderate earnings for the Dow

DJIA, + 0.24%

to S & P 500

SPX, + 0.18%

, through Nasdaq

COMP, + 0.03%

He only manages his eighth-straight win session.

The dollar

DXY, -0.08%

up, along with a crossover

USA: CLU8

, but gold

USA: GCU8

is pitching lower.

Asia stocks saw a mixed day, with a moderate increase for Shanghai Composite

SHCOMP, -0.34%

, while Europe is stocking

SXXP, -0.24%

chiefly

And chart

"If I owned it, I'd sell it all. I do not even grow up. You can not harm Zionion Zion's only on national television and not go through a long recession and serious, "that was David" El Presidente "Portnoy, founder of Barstool Sports at the top of the eraser for Nike

NKE, + 0.32%

late Wednesday

Many people have now seen the pictures and videos from Duke forward Zion Williamson worried in pain after her Nike

NKE, + 0.32%

shoes had fallen at the center of the game, causing injury to the knee end of the NBA draft selection. We hope that its recovery does not take too long. As for Nike, it's already looking rough at a premarket:

Read: The small NFL pensions for players before 1993

Y charm

Avis

CAR, -0.57%

tied forward after beaten broadcasts. Hormel

HRL, -0.39%

a Domino & s

DPZ, -0.27%

He will report before the opening, with Kraft Heinz

KHC, + 1.03%

Hewlett Packard Enterprises

HPE, -0.25%

Roku

ROKU, + 0.79%

to Dropbox

DBX, -1.92%

comes behind the bell.

Watch J & J

JNJ, + 0.49%

, which says she has been downgraded by the United States Department of Justice and the SEC for baby powder safety and talc products.

Apple

AAPL, + 0.64%

to Goldman

GS, -0.04%

is developing a new credit card that will offer additional personal finance features on the iPhone Walllet app, tell sources.

China sells drones to the allies of the United States as quickly as possible.

Plus: Read and subscribe Barron's articles without leaving MarketWatch ever

The economy

A busy day for data, with weekly unemployed claims, backdated durable goods and the Ffed Philly survey before the opening. The manufacturing and services of Markit PMI, along with current home sales and leading economic indicators will follow.

Read: What's all the excitement? The Fed's staff's economic prospects rarely changed in January

Random reads

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The guardian dreamed about killing "almost every last person on earth"

Tucker Carlson hosts the new tape by Fox News its Dutch guest "carrot" and worse

Jussie Smollett's "Empire" actor could face the prison as the police claimed him falsifying that assault

Teen is lucky to be alive after ultimately attempting selfie

Snow falls … onwards Las Vegas

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