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Tax law boosts bank returns

“So have the banks finally turned the corner?” writes Michael Rapoport for marketwatch.com. But that 13% would have been 11.8% without the earnings boost of more than $2.8 billion the six banks collectively received because of the decline in their tax rates from a year ago, driven by the new tax law.While the banks’ first-quarter ROEs were strong, a significant chunk of the strength stemmed not from growth in the banks’ operations, but from the sharply lower tax rates they’re now enjoying because of the federal tax overhaul enacted in…

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The stock market is stuck in a traffic jam — so Goldman Sachs has picked 14 stocks set to break the gridlock by exploding higher

“To put it in the simplest terms, this indicates that the US equity market is currently mired in a traffic jam where almost everyone is stuck moving in the same direction” writes Joe Ciolli for businessinsider.com. Goldman also notes that large pullbacks in stocks have been largely driven by valuation concerns, rather than individual company earnings.Stocks in the US market are increasingly following the herd, and it’s created a huge dilemma for investors who prove their bonafides picking single companies. Without further ado, here are the 14 high-dispersion stocks, arranged…

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There’s a major shift occurring that could signal the end of the historic bull market

“During the nine-year bull market growth stocks have outperformed value by about 50% as measured by the Russell Indexes” writes Kara Chin for businessinsider.com. Over the past 12 months, growth stocks have delivered nearly five times the performance of value stocks.The price-to-forward earnings ratio for growth stocks is over 30 while value stocks have a forward P/E under 20.According to analysis from Fidelity Investments, valuations on growth stocks are significantly higher than value stocks.Two Fidelity portfolio managers have also commented on this shift. Source: businessinsider.com Share This:

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Credit experts in Canada warn of creeping negative equity

“Rising negative equity will likely keep some buyers out of the market for a new vehicle, instead pushing them into the used market” writes John Irwin for autonews.com. Because the average term now exceeds 72 months, these consumers are breaking their loans before they have eliminated negative equity and begun accumulating positive equity.” Fabian said rising negative equity rates could have an impact in other areas.Dark clouds appear to be gathering over the credit landscape in Canada, and the forecast is beginning to look like pain.He said investigations into reports…

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MORGAN STANLEY: We’re already seeing the ‘true tell’ of the start of a bear market

“The true tell will be when the market begins to rotate more aggressively towards defensive leadership,” Wilson said” writes Akin Oyedele for businessinsider.com. An investor who pulls out too early would miss out on what’s historically the strongest period of the bull market — right before the peak.Wilson and his team included a checklist of signs that this phase of bull market is topping out.It’s why Wilson stressed that although we’re seeing a cyclical top for US stocks, we’re still in the middle of a secular bull market.If Morgan Stanley’s…

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JPMorgan says stocks are about to shatter a post-crisis record — and most of Wall Street could be caught off guard

“We are expecting record buyback announcements during this earnings season given further clarity on tax reform (vs” writes Akin Oyedele for businessinsider.com. JPMorgan’s equity strategists are very bullish on first-quarter earnings.Lakos-Bujas forecasts that companies are set to spend a record $800 billion on share buybacks this year, which would provide more support for their stocks.The price-to-earnings multiple based on estimates for the next 12 months is at 15, below its historical median, Lakos-Bujas said. Source: businessinsider.com Share This:

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Buy Stocks On Big Sell-Offs, Says Citigroup

“This indicates that global economic data now is generally coming short of forecasts, per the Journal” writes Mark Kolakowski for investopedia.com. He warns that rising interest rates could set off an avalanche of defaults among over-leveraged companies, eventually causing a stock market collapse of 40%.To capitalize on this environment, equity strategists at Citigroup Inc. are advising investors – not to play it cautiously – but to buy stocks during what Citigroup expects to be a series of steep sell-offs in the coming months. Source: investopedia.com Share This:

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15 tips for first-time home buyers

“To cancel FHA insurance, your only option is to refinance the loan into a conventional loan” writes Aja Mcclanahan for aol.com. When refinancing an FHA loan into a conventional loan, you’ll need 20 percent equity in your home to avoid a PMI purchase.When financing a new conventional loan, consider saving at least 20 percent to put down to avoid having to purchase the insurance.Conventional loans might also require you to purchase PMI if you put less than 20 percent down — or have less than 20 percent equity in your…

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CITI warns…

“Stock markets have had a bumpy first quarter, and global equity analysts at Citigroup believe that this is only set to continue” writes unknown author for cnbc.com. A slowdown in global growth was also mentioned as a risk to Citi’s outlook.Analysts at Citi said Monday that it’s likely that there will be bigger sell-offs ahead — but believes they would opportunities to pick up some bargains.”Our latest round of forecasts imply a rise in global equity markets of about 8 percent to the end of the year, led by Europe…

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