Monthly Archives: August 2018

Random Thoughts

In a classic example of ignoring the headlines and focusing on the bottom line, investors brushed aside seemingly damaging political outcomes and pushed the S&P 500 not only to a record duration, but also a new intra-day, all-time high.

The question du jour is now “how long will this bull market last?”. We think bull markets don’t die of old age, they die of fright and are most afraid of recession.

However, we don’t see a recession on the horizon, since the global economy is expected to maintain its upward growth trajectory, interest rates and inflation are projected to remain low and S&P 500 profits are seen adding 10% in 2019 to the near-23% growth forecast for 2018.

History shows that after a trifecta of all-time highs for the S&P 500, MidCap 400 and SmallCap 600, the “500” was higher in price an average 4.8% six months later and was up 77% of the time vs the average gain of 4.5%, and 73% frequency of advance, for all periods.

Random Thoughts

Last week, Turkey’s currency and equity markets tanked, causing global markets to groan and U.S. stocks to slip, as projected calamities were compared with the Asian Currency Crisis of 1997.

Yet by the end of the week, ominous investment clouds parted, brightening sentiment and reheating share prices.

In review of the week’s economic activity, Action Economics wrote: “Downside risks to the growth outlook seem to be stacking up, with Turkey contagion fears the latest to hit confidence in the Eurozone and the Italian markets. The sensitivity of peripheral bond markets to bouts of risk aversion remains uncomfortably high. However, unless we see a serious global crisis that goes far beyond the Turkey jitters, we don’t expect the central bank to cancel the planned phasing out of net asset purchases by the end of the year.” As a result, AE’s global GDP growth estimates remain encouraging at 3.9% for 2018 and 4.0% for 2019.

In addition, S&P Capital IQ reports that consensus worldwide EPS growth assumptions continue to climb, with developed markets seen posting growth of 4.6% in 2018 and 8.7% in 2019, while the emerging markets are expected to record a 9.1% advance in 2018 followed by a 14.0% gain in 2019.

Large-cap U.S. equities should benefit from this global growth projection as S&P DJ Indices’ recent foreign sales update shows that more than 43% of revenues for the S&P 500 in 2017 came from overseas markets.

Market Insights 8/17/2018

U.S. stocks extended recent gains, finishing Friday’s trading session higher amid some mixed results from Deere & Company and an upbeat report from Nordstrom and as afternoon reports indicated that Chinese leader Xi and U.S.

Technology stocks underperformed their peers as chip companies NVIDIA and Applied Materials announced some disappointing guidance.

Treasury yields dipped and the U.S. dollar traded lower, while gold and crude oil prices were higher.

The Markets….

The Dow Jones Industrial Average (DJIA) advanced 111 points (0.4%) to 25,669

The S&P 500 Index gained 9 points (0.3%) to 2,850

The Nasdaq Composite was 10 points (0.1%) higher at 7,816

In moderate volume, 763 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq

WTI crude oil increased $0.45 to $65.91 per barrel and wholesale gasoline lost $0.01 to $1.98 per gallon

The Bloomberg gold spot price added $9.56 to $1,183.72 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was 0.5% lower at 96.12

Markets were mixed for the week, as the DJIA increased 1.4%, the S&P 500 Index ticked 0.6% higher, and the Nasdaq Composite decreased 0.3%

Leading Indicators tops forecasts but consumer sentiment surprisingly slides to 11-month low

The Conference Board’s Index of Leading Economic Indicators (LEI) for July rose 0.6% month-over-month, above the Bloomberg projection of a 0.4% gain and June’s unrevised 0.5% increase. The index has not seen a decline since May 2016. ISM new orders, the yield curve, the credit index, stock prices and consumer expectations were positive, while building permits were negative.

Treasuries ticked mostly higher, with the yields on the 2-year note and the 30-year bond dipping 1 basis point to 2.61% and 3.02%, respectively, while the yield on the 10-year note was flat at 2.86%.

The August preliminary University of Michigan Consumer Sentiment Index unexpectedly declined to an 11-month low of 95.3, compared to expectations for a slight rise to 98.0 from July’s final read of 97.9. The current economic conditions component of the survey fell, more than offsetting the expectations measure that held steady. The 1-year inflation forecast remained at 2.9%, while the 5-10 year inflation forecast ticked higher to 2.5% from the previous 2.4% rate.

Europe lower after yesterday’s gain, Asia mostly higher to close out the week

European equities finished mostly lower, with the markets appearing to pause and reflect on a choppy week that saw weakness followed by yesterday’s gain. Trade optimism fueled yesterday’s advance as China and the U.S. looked poised to restart stalled trade talks, but festering concerns regarding the Turkish economic/currency turmoil continued to keep conviction in check and bog down the financial sector.

Also, some disappointing guidance from the semiconductor sector in the U.S. today seemed to add to the market skittishness and weigh on the technology sector. However, stocks came off the worst levels of the session late in the day, mirroring the action in the U.S. As market choppiness lingers.

Stocks in Asia finished mostly to the upside, following the solid gains in the U.S. and Europe yesterday, with China’s announcement that it plans to resume trade talks with the U.S. later this month fostering optimism and cooling concerns.

France’s CAC-40 Index and Spain’s IBEX 35 Index dipped 0.1%, Germany’s DAX Index declined 0.2%,, and Italy’s FTSE MIB Index fell 0.5%, while the U.K. FTSE 100 Index finished little changed and Switzerland’s Swiss Market Index ticked 0.1% higher.

Lingering Chinese economic concerns and recently flared-up uneasiness toward emerging markets fostered some mixed action in China. Japanese equities advanced, with the yen holding steady during the session, and South Korean shares also gained ground. Australian securities traded higher and Indian stocks advanced. Equities trading in both mainland China and Hong Kong finished to the upside.

Stocks mixed as data flies, trade optimism resurfaces, and Turkish turmoil escalates

U.S. stocks diverged in a choppy week that saw a host of economic and earnings reports paint a mixed picture. China’s announcement that it plans to resume stalled talks with the U.S. cooled trade concerns, though escalated Turkish turmoil hamstrung conviction and pressured Europe and emerging markets. Energy stocks fell as crude oil prices continued to slide, exacerbated by a surprising jump in oil inventories, while the tech sector saw some renewed pressure on earnings reports from the group.

The markets appeared to have a defensive tilt as telecom, consumer staples, and utilities moved noticeably to the upside to help the S&P 500 eke out a slight gain. The U.S. dollar retreated a bit after hitting a 14-month high earlier in the week. Treasury yields were also subdued, with stronger-than-expected reads on retail sales, small business optimism, productivity, and Leading Indicators being met with softer-than-expected releases of industrial production, the Philly Fed Manufacturing Index, and consumer sentiment.

The Dow registered a solid gain, aided by strength in industrials as trade optimism nudged higher and Walmart Inc. jumped sharply on its blowout earnings report. However, consumer discretionary stocks posted a red figure as Walmart’s rally was countered by heavy scrutiny of earnings results from Dow member Home Depot Inc., Macy’s Inc., and J.C. Penney Company Inc.

U.S. stock indexes have moved within striking distance of record highs on quiet summer trading. However, we see some signs below the surface that risks are rising and the potential for more volatility and pullbacks is growing. Earnings season was stellar but the risk is that the expectations bar is getting set too high. Economic growth continues to be solid, but the rate of improvement may be leveling off, while trade/tariff concerns and the Fed inject more uncertainty for investors. The Fed has expressed little concern, but financial conditions have gotten tighter this year, which has implications for markets.

Next week, as the retail sector continues to put the finishing touch on another solid earnings season, the economic calendar will bring key reads on last month’s existing and new home sales, Markit’s preliminary August business activity reports and July preliminary durable goods orders. However, the Fed will likely command the most attention, with the release of the minutes from its most recent monetary policy meeting, which included an upgraded economic assessment to set the stage for a September rate hike.

Close attention could be paid to the Fed’s Annual Central Banking Symposium in Jackson Hole, Wyoming, which will culminate with Chairman Jerome Powell’s remarks on Friday. The markets will likely be looking to see if the recent uptick in global uncertainty has had any impact on the Central Bank’s appetite to continue steadily hiking rates.

Market Insights 8/16/2018

U.S. stocks rebounded nicely after yesterday’s decline amid some upbeat earnings reports from Dow member’s Walmart and Cisco, while China announced that it plans to resume trade talks with the U.S.

Treasury yields ticked slightly higher and crude oil prices also nudged to the upside, while the U.S. dollar and gold dipped.

In economic news, housing, employment and some regional manufacturing data came in mixed.

The Markets…

The Dow Jones Industrial Average (DJIA) jumped 396 points (1.6%) to 25,559

The S&P 500 Index gained 22 points (0.8%) to 2,841

The Nasdaq Composite was 32 points (0.4%) higher at 7,807

In moderate volume, 706 million shares were traded on the NYSE and 2.0 billion shares changed hands on the Nasdaq

WTI crude oil increased $0.45 to $65.46 per barrel and wholesale gasoline lost $0.01 to $1.99 per gallon

The Bloomberg gold spot price dipped $1.23 to $1,173.61 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was nearly 0.1% lower at 96.63

Housing construction activity mixed, jobless claims unexpectedly dipped

Housing starts for July rose 0.9% month-over-month to an annual pace of 1,168,000 units, below the Bloomberg forecast of a 1,260,000 unit rate. June starts were revised lower to an annual pace of 1,158,000. Building permits, one of the leading indicators tracked by the Conference Board as it is a gauge of future construction, grew 1.5% m/m to an annual rate of 1,311,000, versus expectations of a 1,310,000 pace, and compared to June’s upwardly revised 1,292,000 rate.

Weekly initial jobless claims declined by 2,000 to 212,000, versus estimates calling for 215,000, with the prior week’s figure revised higher by 1,000 to 214,000. The four-week moving average rose by 1,000 to 215,500, while continuing claims fell by 39,000 to 1,721,000, south of estimates of 1,740,000.

The Philly Fed Manufacturing Index in August fell more than expected but remained at a level depicting expansion (a reading above zero), dropping to 11.9 from 25.7 in July, compared to estimates of a decline to 22.0.

Treasuries dipped following the data, with the yields on the 2-year and 10-year notes ticking 1 basis point higher to 2.62% and 2.87%, respectively, while the 30-year bond yield was flat at 3.03%.

Tomorrow, the U.S. economic calendar will yield the Index of Leading Economic Indicators, with economists projecting a 0.4% m/m advance for July, following the 0.5% gain seen the month prior. Rounding out the day will be the preliminary University of Michigan Consumer Sentiment Index for August, which is expected to tick higher to 98.0 from July’s final read of 97.9.

Europe rebounds on earnings, Asia mostly lower after paring losses

European equities rebounded broadly, with technology issues leading the way after falling yesterday as China’s Tencent Holdings’ disappointing earnings report unnerved the sector globally. China’s announcement that it plans to resume stalled trade talks with the U.S. later this month bolstered the global mood. Earnings on both sides of the pond also helped aid global sentiment.

U.K. retail sales for July easily topped forecasts to also support the positive backdrop. The euro and British pound rose versus the U.S. dollar, while bond yields in the region finished mixed but tilted to the upside. However, Italian markets bucked the trend after being closed yesterday, when the global market slipped on the escalated concerns regarding the Turkish economic/currency crisis.

Stocks in Asia finished mostly lower amid lingering concerns about the potential impact of the Turkish economic/currency crisis, especially on emerging markets. Sentiment in the technology sector remained unnerved after the Chinese internet company Tencent Holdings posted a surprise drop in profits and slower-than-expected revenue growth. However, markets came off the worst levels of the day after China announced that it intends to restart stalled trade talks with the U.S. later this month.

Japanese equities dipped, with the yen gaining ground despite a smaller-than-expected rise in the nation’s July exports. Stocks trading in mainland China and in Hong Kong declined.

Market Insights 8/15/2018

Yesterday’s rebound was a fleeting memory, as U.S. equities saw solid declines amid escalated global uneasiness surrounding the economic/currency turmoil in Turkey, soft economic data out of China, and continued pressure on technology stocks.

Commodities also sold off, as gold and copper tumbled, and crude oil prices dropped in the wake of an unexpected rise in oil inventories.

Treasury yields fell amid the negative sentiment, with mostly upbeat economic reports providing little help, while the U.S. dollar was nearly unchanged.

The Markets….

The Dow Jones Industrial Average declined 138 points (0.5%) to 25,162

The S&P 500 Index decreased 22 points (0.8%) to 2,818

The Nasdaq Composite was 97 points (1.2%) lower at 7,774

In moderately-heavy volume, 797 million shares were traded on the NYSE and 2.3 billion shares changed hands on the Nasdaq

WTI crude oil tumbled $2.01 to $65.01 per barrel and wholesale gasoline lost $0.03 to $2.00 per gallon

The Bloomberg gold spot price plunged $18.48 to $1,175.61 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was nearly unchanged at 96.69

Retail sales top forecasts, headlining a busy economic docket

Advance retail sales for July rose 0.5% month-over-month, above the Bloomberg forecast of a 0.1% gain, while June’s figure was revised downward to a 0.2% rise. Last month’s sales ex-autos were up 0.6% m/m, versus expectations calling for a 0.3% rise and the negatively-revised 0.2% gain seen in June. Sales ex-autos and gas rose 0.6% m/m, compared to estimates of a 0.4% gain and June’s revised lower 0.2% increase. The control group, a figure used to calculate GDP, grew 0.5%, compared to projections of a 0.4% gain and June’s negatively- revised 0.1% dip.

The Empire Manufacturing Index showed output from the New York region unexpectedly accelerated further into expansion territory (a reading above zero) for August. The index rose to 25.6 from July’s unrevised 22.6 level, with forecasts calling for a dip to 20.0.

The Federal Reserve’s industrial production report showed a 0.1% m/m uptick in July, compared to estimates of a 0.3% gain, but June’s 0.6% rise was revised to a 1.0% increase. Manufacturing output rose slightly, offset by declines for mining and utilities production. Capacity utilization held steady at the prior month’s upwardly-revised 78.1% rate, and versus forecasts of 78.2. Capacity utilization is 1.7 percentage points below its long-run average.

Treasuries were higher, as the yields on the 2-year and 10-year notes, along with the 30-year bond, fell 3 bps to 2.61%, 2.86% and 3.03%, respectively. The markets continue to grapple with a solid economic/earnings foundation, relatively calm Fed tightening concerns, the escalated economic/currency crisis in Turkey, as well as continued softness in data and the stock markets in China.

The National Association of Home Builders (NAHB) Housing Market Index showed homebuilder sentiment this month dipped to 67 from July’s unrevised 68 level, in line with forecasts. However, a reading of 50 separates good and poor conditions. The NAHB said builders continue to report strong demand for new housing, fueled by steady job and income growth along with rising household formations, but they are increasingly focused on growing affordability concerns, stemming from rising construction costs, shortages of skilled labor and a dearth of buildable lots.

The MBA Mortgage Application Index declined 2.0% last week, following the prior week’s 3.0% decrease. The fall came as a flat reading for the Refinance Index was met with a 3.3% drop in the Purchase Index. The average 30-year mortgage rate decreased 3 basis points to at 4.81%.

Europe and Asia stumble on Chinese weakness, Turkish concerns

European equities finished broadly lower, led by a drop in materials issues, with China continuing to fall following a flood of disappointing economic reports and earnings results out of the tech sector that appear to be keeping the global markets on edge. Energy stocks also saw solid pressure as crude oil prices fell in the wake of an unexpected jump in oil inventories in the U.S.

The festering Turkish economic/currency crisis added to the market skittishness, along with the extended gain in the U.S. dollar during the session that pressured the euro and British pound. Bond yields in the region finished mixed. In economic news, U.K. inflation statistics came in mixed for July.

Stocks in Asia finished mostly to the downside, despite the solid rebound in the U.S. yesterday that came as the Turkish lira recovered somewhat. However, the economic/currency crisis in Turkey remained a source of skittishness and Chinese markets continued to slide.

Stocks in mainland China and Hong Kong fell sharply, with the yuan weakening in the wake of this week’s flood of disappointing economic data, as well as pressure coming from the technology sector. Japanese equities declined amid the weakness in the tech sector as well, even as the yen lost some ground.

Australian securities overcame early losses and finished higher, aided by strength in healthcare, technology and consumer staples issues. Markets in South Korea and India were closed for holidays.

Random Thoughts

Even though most economists we follow do not expect the crisis in Turkey to spread, since the problems appear more endemic to Turkey than systemic to the global financial markets, we remain vigilant to the likelihood of further lashings by the lira.

In 1997-98, investors paid for their underestimation the contagion associated with the Thai baht implosion. The crisis started in July 1997, but the S&P 500 continued to climb to a new high in early August before zigzagging between new highs and 6% to 11% selloffs through October.

Not surprisingly, the emerging markets fared far worse. The S&P Emerging BMI (Broad Market Index) topped out in late August, only to fall below the 5% decline threshold on 10/23, the -10% level on 10/27, and then below -20% on 11/12 as the crisis spread to other Asian currencies. The index didn’t finally bottom (-51%) until September of the following year, after succumbing to additional concerns surrounding Russian and Brazilian debt.

Market insights 8/14/2018

U.S. equities were able to rebound from a two-day tumble, fueled by the Turkish economic/currency crisis, getting support from relatively upbeat quarterly results from Home Depot, Advance Auto Parts and Tapestry, as well as a surprising improvement in small business optimism.

Treasury yields ticked higher and the U.S. dollar regained some momentum, following import price data that was in line with forecasts.

Crude oil prices were mixed and gold inched higher after a 4-day slide.

The Markets…

The Dow Jones Industrial Average increased 112 points (0.5%) to 25,300

The S&P 500 Index rose 18 points (0.6%) to 2,840

The Nasdaq Composite was 51 points (0.7%) higher at 7,871

In moderate volume, 657 million shares were traded on the NYSE and 1.9 billion shares changed hands on the Nasdaq

WTI crude oil ticked $0.16 lower to $67.04 per barrel and wholesale gasoline gained $0.02 to $2.03 per gallon

The Bloomberg gold spot price inched $0.87 higher to $1,194.66 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was up 0.3% to 96.72

Small business optimism unexpectedly improves, import price inflation data mixed

The National Federation of Independent Business (NFIB) Small Business Optimism Index for July surprisingly improved to 107.9, from the prior month’s unrevised 107.2 level, versus the Bloomberg expectation of a dip to 106.8.

The Import Price Index came in flat month-over-month (m/m) for July, in line with projections, and following June’s upwardly revised 0.1% decrease. Compared to last year, prices were up by 4.8%, above forecasts of a 4.5% increase and compared to the previous month’s upwardly revised 4.7% gain.

Treasuries dipped, as the yields on the 2-year and 10-year notes, as well as the 30-year bond, all ticked 1 basis point higher to 2.63%, 2.89% and 3.06%, respectively.

This sets the stage for tomorrow’s fully-loaded economic calendar, which will likely be headlined by the release of July retail sales, anticipated to tick 0.1% higher m/m, after June’s 0.5% gain. Excluding autos and gas, sales are figured to rise 0.4% on the heels of the prior month’s 0.3% increase. The control group, a figure used to calculate GDP, is estimated to rise 0.4% after being flat in June.

Also on the docket is the Federal Reserve’s industrial production and capacity utilization report, predicted to show production rose 0.3% m/m during July and utilization crept upward to 78.2%, as well as preliminary non-farm productivity and unit labor costs for Q2, with economists projecting the former to have risen 2.4% and the latter to indicate a flat reading on a quarter-over-quarter basis.

The NAHB Housing Market Index is also set for release, expected to tick lower to a level of 67 for August, while the Empire Manufacturing Index is estimated to have declined to a reading of 20.0 for August, and business inventories and MBA Mortgage Applications will round out the calendar.

Europe mixed on data and Turkish focus, Asia mostly rebounds but China sags on data

European equities finished mixed, with the euro and British pound declining versus the U.S. dollar, while financials saw some pressure as the focus on the Turkish economic/currency crisis remains. Turkish concerns have pressured the global markets the past two sessions, but a rebound in the Turkish lira appeared to soothe some of the uneasiness. A flood of economic data was digested, headlined by stronger-than-expected Q2 GDP reports out of the Eurozone and Germany.

Eurozone industrial production data was mixed and the U.K. employment change came in below forecasts for June. Bond yields in the region finished mixed.

Stocks in Asia finished mostly higher, rebounding from yesterday’s decline that came from the escalated economic/currency turmoil in Turkey, with a reprieve from the drop in the Turkish lira appearing to calm concerns. Japanese equities rallied, with the yen giving back some of a recent gain that came amid the increased uneasiness in the global markets.

Markets in South Korea and Australia advanced, and stocks in India increased, with the pause in the U.S. dollar’s strength likely lending support, along with late-yesterday’s cooler-than-expected read on the nation’s consumer price inflation for July.

Securities in mainland China and Hong Kong dropped following a flood of mostly lackluster July economic data. Late-yesterday’s softer-than-expected lending statistics was followed by smaller-than-projected increases for China’s retail sales, industrial production and fixed asset investment, which seemed to overshadow favorable data on new yuan loans.

Market Insights 8/13/2018

Despite gains early on, U.S. equities again succumbed to the global uneasiness surrounding the potential spillover effect of the economic/currency crisis in Turkey, finishing lower but off the lows of the day.

Financials led the way to the downside and energy issues saw some pressure amid the continued downdraft in crude oil prices.

Treasury yields moved higher and the U.S. dollar was little changed in the midst of a dormant economic calendar, while gold tumbled.

The Markets…

The Dow Jones Industrial Average declined 125 points (0.5%) to 25,188

The S&P 500 Index decreased 11 points (0.4%) to 2,822

The Nasdaq Composite was 19 points (0.3%) lower to 7,820

In moderate volume, 723 million shares were traded on the NYSE and 1.9 billion shares changed hands on the Nasdaq

WTI crude oil fell $0.43 to $67.20 per barrel and wholesale gasoline lost $0.03 to $2.01 per gallon

The Bloomberg gold spot price tumbled $16.19 to $1,194.38 per ounce

The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was unchanged at 96.38

Treasury yields higher ahead of a robust economic week

Treasuries were lower amid an economic calendar void of any major releases today, as the yield on the 2-year note ticked 1 basis point higher to 2.61%, the yield on the 10-year note rose 2 bps to 2.68%, and the 30-year bond rate advanced 3 bps to 3.05%

With earnings season winding down, this week’s busy economic week will likely garner more scrutiny, headlined by the releases of retail sales, industrial production and capacity utilization, housing starts and building permits, the Leading Index, the preliminary August University of Michigan Consumer Sentiment Index, and regional manufacturing reports for this month.

Tomorrow, the week will begin with July releases of the NFIB Small Business Optimism Index, projected to dip to 106.8 from 107.2 in June and the Import Price Index, anticipated to be flat month-over-month after declining 0.4% in the month prior.

Europe and Asia lower as Turkish worries remained

European equities finished mostly lower, with the global markets remaining on edge amid the escalated economic/currency turmoil in Turkey, even as Turkey’s central bank announced measures to try to help combat the recent tumble in the lira. The financial sector extended Friday’s losses when the Turkish turmoil flared up. However, markets pared some losses, with the technology sector continuing to recover. The euro dipped and the British pound nudged higher versus the U.S. dollar, while bond yields in the region gained ground.

The U.K. FTSE 100 Index and Switzerland’s Swiss Market Index were down 0.3%, Germany’s DAX Index decreased 0.5%, Italy’s FTSE MIB Index declined 0.6%, and Spain’s IBEX 35 Index fell 0.8%, while France’s CAC-40 Index finished little changed.

Stocks in Asia finished broadly lower amid festering global market concerns toward the potential impact of the Turkish economic/currency crisis, which continued to hamper conviction. Japanese equities dropped sharply, with the yen gaining noticeable ground.

Mainland Chinese stocks and those traded in Hong Kong fell 1.5%, while the markets digested late-Friday’s data that showed an unexpected quarter-over-quarter contraction in Hong Kong’s Q2 GDP.

Markets in Australia and South Korea were lower, and stocks in India finished to the downside amid the Turkish turmoil uneasiness, which appeared to overshadow late-Friday’s report that showed the nation’s industrial production rose more than expected.

Random Thoughts

On August 22, 2018, this bull market will have avoided declining by 20% or more on a closing basis in 3453 calendar days.

Some will therefore call it the longest bull market since WWII. They will have a lot to brag about. Through August 10, the S&P 1500 advanced 329% in price, while all 11 sectors gained in price, and all but three of its 145 sub-industries were up in the period.

Yet some market observers don’t believe that 8/22 will signal the passing of the “longest bull market” crown from the bull that ended in 2000 to the current one.

They believe the current bull will have to wait until 4/3/2021 before claiming the crown.

Why? Because they believe that since the decline from 7/16/90 through 10/11/90 was only 19.9% on a closing basis, it should be classified as the deepest of corrections, not a bear market. From the strictest interpretation of that single bear-market criterion, they would be right.

U.S. Market Weekly Summary – Week Ending 08/10/2018

The S&P 500 edged down 0.2% this week, with consumer staples leading a number of sectors to the downside, outweighing gains from the consumer-discretionary, telecommunications and technology sectors.

The market benchmark ended the week at 2,833.28, down from last week’s closing level of 2,840.35. The slight fall came as quarterly earnings results continued to come in largely above analysts’ expectations this week, but concerns about trade tensions also continued to weigh as China threatened to place new tariffs on goods including chemicals and medical equipment in response to the latest trade threats from the US.

Consumer stocks diverged, with the consumer staples posting the largest percentage drop of the week, off 1.9%, while the consumer-discretionary sector had the largest percentage gain of the week, up 0.8%. Just two other sectors managed to post gains for the week: telecommunications, up 0.7%, and technology, up 0.3%, while the rest of the S&P 500′s 11 sectors were in the red.

In the consumer-staples sector, decliners included Campbell Soup (CPB), which shed 3.3% this week. Dan Loeb, the founder of hedge fund Third Point, disclosed in a regulatory filing that he has a 5.7% stake in the food-products company and plans to work with George Strawbridge, a family member of Campbell Soup’s founders, to seek a buyer for the company.

In the consumer-discretionary sector, gainers included Royal Caribbean Cruises (RCL), which posted Q2 adjusted earnings per share above analysts’ expectations despite revenue coming slightly shy of the Street view. The company also reiterated its prior guidance for full-year adjusted EPS. Shares climbed 1.1% this week.

Also among consumer-discretionary stocks, Amazon.com (AMZN) shares hit a record high this week and closed the week up 3.5% from last Friday. The retail company and its Whole Foods Market segment announced the start of a grocery-pickup service under which members can place orders using an app and pick up their groceries in as little as 30 minutes from select Whole Foods stores.