So far the broad stock market (1700+ stock composite) has traversed the seasonally volatile Aug. -
Nov.1 period with minor damage. There has been a hiccup in volatility, and the average stock has
under performed the large cap. SPX, but the broader market has tested its 200 day m/a in an alright
fashion even if it is not entirely out of the woods on this important measure. VLE Daily
There has been damage worth noting. Just over 50% of stocks are in confirmed uptrends. That
does not compare favorably with the SPX. Moreover, the broad VLE composite continues in a
lengthy 10 month downtrend in comparison to the large cap. measure with this development
signalling investor caution concerning the economic outlook running out into 2018. Since my
weekly economic and profits indicators have been stagnant since earlier this year, the caution may
not prove unwarranted. It is also worth noting that unlike the SPX, the uptrend in the VLE has
been broken. At best, that signals the broad market may chart a fresh course which need not
be as positive as the run from early 2016.
Worries, such as some measure of armed conflict with NK, the short term negative impact of
monster storms Harvey and Irma, and political dumpster fires in the nation's capital seem to
have been set aside for now in favor of the longer standing meme of low growth, low inflation
and a high market p/e ratio that has sustained the bull market for the past several years.
- Peter Richardson
- Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!