Trick Or Treat? Here Are The Stocks That Have Soured In 2020

[Option Beast]( 10/31/2020   |   [View in browser]( --------------------------------------------------------------- [Trick Or Treat? Here Are The Stocks That Have Soured In 2020]( The stock market has been kind of spooky lately. On Friday, the Dow was on course for its worst month since pandemic lockdowns sparked a massive sell off in March. So CNN Business decided to take a look at which stocks are looking like sweet treats, and which appear decidedly tricky. It should come as no huge surprise that through the first 10 months of 2020, this year's winners losers are mainly in the energy and leisure industries. [More...]( SPONSORED CONTENT [Options Trading System With A 94.8% Win-Rate On Last 727 Trades]( The key to being consistently profitable as a trader is to focus on high-probability trades. And in this powerful eBook by Dave Acquino, titled The Ultimate Income Trading System, you'll see exactly how Dave and so many of his students do just that. They make 4%, 5% or 6% on each trade and they're in the trade for just 11 hours. [CLICK HERE for instant access.]( [REFLECTIONS... The White House Sprint by David Sager](#) The market was 'whipsawed' by the back and forth negotiations over the proposed stimulus package. As the week progressed serious discussions seemed to stall and by Friday fell into a pit- the usual scenario at week's end, recently. And without more stimulus, the economy- and the stock market have gotten as good as they can get. Earnings season might even confirm that suspicion. Of the 135 companies that have reported so far, 83% have topped earnings forecasts, well above the long-term average of about 65%, while the average earnings number has been 17.7% above expectations, almost five times the long-term average of 3.5%. Together the lack of a stimulus and the lukewarm response to earnings would seem to imply tougher times are ahead for stocks. But maybe not. The markets seem to quantify winners and losers. Companies that had seen their businesses hurt during the early stages of the pandemic and then experienced a turnaround gained buying favor, while the initial losers who are still mired in negative or marginal earnings are still suffering. A good example of positive news spewed by a notable figure, Las Vegas Sands CEO said he remains "optimistic about the eventual complete recovery of travel and tourism spending across our markets." The Sands stock shot 12% highter and bookings edged upward shortly afterward! That stocks react favorably suggests that investors believe the economy can continue to grow in the months ahead despite the virus. Another interesting piece to the barometer is the ratio of copper to gold prices has risen to 0.1633 and is trending higher, a sign that economically sensitive stocks could be poised to outperform. The Dow Jones Industrial Average this past week fell 270 points or 0.9% to 28,335, while the S.& P 500 declined 0.5% to 3,465, and the Nasdaq Composite dropped 1.1% to 11,548. All indexes suffered a bit throughout the week, with slight tightening by Friday. As we enter the last nine days before the November 3rd election, (an unbelievable 50 million have cast their votes) there are few questions on political platforms, hopefully the results will be conclusive, and leave no doubts as to whom the winner is. BCA Research bond strategists base their forecasts on its estimate of a45% probability of aDemocratic sweep of the White House and the senate, which would lead to "unfettered stimulus in 2021" but a "negative shock" to profits from increased corporate taxes and regulation. The second-most-likely scenario, with 30% probability, would be Trump's re-election, with Republicans retaining control of the Senate. This BCA predicts, "would result in less fiscal stimulus but risk the heightened trade wars, not just with China, but also with the European Union," the advisory service says. A Biden win, combined with a GOP Senate, has 20% probability but would be the most positive outcome for financial markets, BCA says, with lower odds of a trade war with China and no tax hikes. A Trump victory with a Democratic Senate has just a 5% probability, which could lead to big populist spending with no tax boosts, and the continued risk of the U.S.-China trade conflicts. Both Trump and Biden would substantially boost federal debt by $4.95 trillion and $5.60 trillion, respectively, by 2030 according to BCA Research Bidden would ramp up spending by more than twice as much, by $11.1 trillion verses $5.45 trillion by Trump. The Democrat would boost federal revenue by $5.8 trillion through tax hikes on corporations and upper income households, while the GOP would have $750 billion in savings. The diesel market serves as a barometer for the state of the economy because the fuel is widely used in the transportation industry., Right now the signals diesel is giving off in terms of supply, demand, and prices don't point to a very promising future. "It is the best fuel to see how the economy is recovering" since it's a "fuel of industry," says Patrick DeHaan, head of petroleum analysis at GasBuddy. "But supplies of distillates which include diesel and jet fuel, are running "some 30% above year-ago levels." That's "representative of a slowdown in the economy and, certainly, air travel," says DeHaan. Diesel demand has taken a hit on reduced economic activity, with fewer trucks on the road and "thousands of school buses (that) aren't running," says DeHaan. Still there have been signs of improving demand, with diesel cumsumppion starting to move toward the four week average, indicating the worst is behind us. RUMBLINGS ON THE STREET Mary McGrath, Cozad Asset Management,m Barron;s "I see a couple of volatile months between now and the end of the year," says Ms. McGrath. "But I also believe that the market always anticipates what's going to happen. Once we get into 2021, and we get a vaccine, and the economy starts to pick up, the stock market will be higher than it is today." Harlan Cadinha,founder, chairman, and chief strategist at Cadinha & Company, in Honolulu, Barron's "We assume that Democrats will sweep. That's a big transition." Should the Democrats gain full control of both the executive and legislative branches of government, Cadinha sees an effort to pass a stimulus bill and other measures, such as an infrastructure package, which could pick up some slack in the economy. At the same time, he's concerned that the party would push for higher corporate taxes or an increase in the capital-gains tax rate. These would be negatives for the stock market, spurring a wave of selling before they take effect. "If there is a Democratic sweep, this year's most successful stocks are apt to come down the most because they're got the gains," Cadinha says. "People will move to capture those gains this year, rather than next, so you could see them hit." Federal Reserve Chairman Jerrome Powell, Barron's Mr. Powell said that the U.S. would proceed cautiously on a digital currency. "We do think it's more important to get it right than to be first," he said, warning of threats of cyber attacks, counterfeiting, and fraud and the need to ensure safety and security. Craig Moffett, Telecom Analyst with Moffett-Nathanson, Barron's "The uncomfortable reality is that 5G in any spectrum band other than millimeter wave is basically just (4G) with a new name," says Craig Moffett. The most surprising part of the iPhone 12 is how much wireless carriers want you to have one. The carriers have generous, even free, deals for the new phone. It's "a preemptive race to the bottom," says Mr. Moffett. [The Serious Disconnect Between A Hot Residential Real Estate Market And The Coming Tsunami Of Foreclosures]( Various reports show that the market for previously-owned homes climbed nearly 10% in September, the fourth straight monthly increase. It is not just sale volumes that are high, but the price of homes is showing double-digit gains. If you just look at volume and prices, the U.S. residential real estate market looks as rosy as every, spurred on by very low interest rates from the same Federal Reserve which once-upon-a-time was tasked with preventing bubbles above all else but during the last three decades has arguably been the chief cause of them. That's the sunny side of the street. The shady side of the street is much different. Mortgage delinquency rates are at a 20-year high - worse than the 2008 high if that tells you anything (and it should), and there are predictions that at least two million mortgages will soon go into default. [Article continues...]( [The Best Early Black Friday Deals From Walmart, Best Buy, and Target]( You can thank the pandemic for Amazon Prime Day's shift from mid-July to October 13 and 14 this year. And when Walmart, Best Buy, Target, and the like followed suit with their own sales, they kicked off an avalanche of holiday sales that will carry everyone right into December. So it's kind of no big deal if you missed the good Prime Day sales (the Wirecutter Deals team found that less than 1% of the total deals scanned met our standards, anyway), because there's plenty of shopping season left. [Click to continue reading this article...]( [Older Workers Are Struggling To Find Jobs Amid The Coronavirus Pandemic]( You would think having decades of experience should help in a job search. Yet it's holding many older unemployed workers back during the coronavirus pandemic. Massive unemployment has impacted American workers of all ages, and those over 55 face challenges in reentering the workforce amid a recession. The average duration of unemployment for older workers is much longer than those experienced by younger groups. Some older workers never fully recover after long-term unemployment, said Susan Weinstock, vice president of financial resilience programing at AARP. "It's devastating to someone who might consider themselves at the top of their career," she said. [More here...]( SPONSORED CONTENT [Do You Have Zero Experience Trading?]( Quick!....get this free e-book that was designed to teach beginners how to trade options while you still can. Want to start trading with a small account? Got you covered on that also. Chuck Hughes has taught thousands of beginners how to be successful in trading. 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