Another Rear View Reality

It seems like forever ago but 6 months ago we were calling for:

A)    a MEGA Squeeze in Consumer Discretionary

B)    a Q2 Bottom in US Housing

Over the past month the Consumer Discretionary (XLY) has been the second best performing sector rising 9.3%.  Within the XLY, Home Builders and Household durable names have been the best performing names within the index.

Yesterday’s new home sales data and now the data from Case-Shiller provide some economic support for the move in the XLY.  The S&P/Case-Shiller home-price index dropped 17.1% year-over-year, the smallest drop in nine months.  The index increased from the prior month for the first time in almost three years. According to Bloomberg, consensus forecast suggested the index would drop 17.9%.

Helping to moderate the decline in home prices is the fact that distressed properties account for a smaller share of those sales.   In three out of the last four months, the index has seen a sequential improvement in moderating home prices. 

Stocks, fortunately, have discounted a lot of this news. They don’t care so much for the Rear View.

Howard Penney

Another Rear View Reality - shiller1

Another Rear View Reality - shiller2

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more

A Sneak Peek At Hedgeye's 2017 GDP Estimates

Here's an inside look at our GDP estimates versus Wall Street consensus.

read more

Cartoon of the Day: Green Thumb

So far, 64 of 498 companies in the S&P 500 have reported aggregate sales and earnings growth of 6.1% and 16.8% respectively.

read more

Europe's Battles Against Apple, Google, Innovation & Jobs

"“I am very concerned the E.U. maintains a battle against the American giants while doing everything possible to sustain so-called national champions," writes economist Daniel Lacalle. "Attacking innovation doesn’t create jobs.”

read more

An Open Letter to Pandora Management...

"Please stop leaking information to the press," writes Hedgeye Internet & Media analyst Hesham Shaaban. "You are getting in your own way, and blowing up your shareholders in the process."

read more