VIDEO: Is Sentiment Changing From Bleak to Bullish?
The storyline about the stock market has been less than reassuring these past seven to eight months.
However, there seems to have been a momentous shift in recent days.
In fact, Weiss Ratings Senior Analyst Jon D. Markman, a two-time Pulitzer Prize winner, calls it a “market in transition.”
Jon tells me he does not believe that the Federal Reserve’s cycle of interest rates is having a negative impact on the economy:
There’s no evidence that the economy is slowing dramatically because of the Fed.
And it’s actually possible that the Fed is going to get the so-called “soft landing” that everyone derided them for thinking they could achieve.
There’s a growing consensus now that inflation has peaked.
Commodities prices— copper, lumber, iron ore, wheat, even oil — all peaked in the middle of June and they’re all coming down.
History shows that when the market was down more than 20% in the first half of the year, it reversed most of those losses in the second half.
Jon is behind four services, including The Power Elite, which focuses on profitable companies that dominate a niche.
Members of The Power Elite are sitting on open gains of 167%, 158% and 150%.
Jon is also the editor of Weiss Technology Portfolio, which targets companies that are advancing the great digital transformation — a trend Jon predicted decades ago.
Members of that premium service have open gains of 340%, 334% and 273%.
Jon points to several factors that bode well for a bullish outlook:
1. The Consumer Price Index for July came in at 8.5% (below the consensus forecast of 8.7%).
2. The Producer Price Index, per the U.S. Bureau of Labor Statistics, had a 0.5% decline in July.
3. The U.S. Employment report showed a 528,000 gain in nonfarm jobs in July — double what analysts expected.
4. The unemployment rate fell from 3.6% to 3.5% and remains near historic lows.
In today’s four-minute video segment, Jon explains why he believes recession worries are overblown and how investor sentiment — the emotion driving the markets — as well as the mood in the equity markets has shifted from bleak to positive.
He points to companies’ underwhelming Q2 earnings and how shares still fared well:
I lean toward the idea that there’s been a massive change in sentiment about stocks.
For the first time in 2022, stocks are rallying on bad news. Bears are losing the narrative because stocks are no longer declining on bad news.
When stocks don’t decline on bad news, they inevitably move higher.
It’s hard to make the case that companies are going to get smashed on lousy earnings when the opposite is actually occurring.
Tesla (TSLA), Microsoft (MSFT), and Alphabet (GOOGL) all reported earnings. They all missed their profit numbers, and they all missed their revenue numbers, and the stocks all rose despite those misses.
If we were in a bear market and the sentiment was negative, those stocks would’ve gotten crushed on the results that they provided.
In this insightful video, Jon and I explore:
- A semiconductor firm that’s helping create entirely new industries.
- A company’s explosive breakthrough that will reshape a sector.
- Two exchange-traded funds that give exposure to a market he believes will be a surprise winner for the rest of the year.
- The “bottom line” that investors should not ignore.
The information in this short segment couldn’t be timelier. Just go to the video box above to watch it now.
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