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Here’s how violent the stock-market rotation out of tech has been

“The rotation continued Monday, with the Nasdaq dropping more than 1% and the S&P 500 tech sector falling nearly 2%” writes Deputy Markets Editor for marketwatch.com. The S&P 500 tech sector was the only one of the index’s 11 main sectors to remain in positive territory, up 0.4%.Tech stocks also swooned in June, prompting calls for a shift out of tech and into energy as oil prices recovered, noted Jasper Lawler, head of research at London Capital Group, in a note.See: Here’s why the corporate AMT is a hurdle to…

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Think it’s time to protect your stock-market gains?Consider these 4 options

“Whether cash, long-term Treasury bonds, gold or derivatives, each offers the potential to protect against the ravages of the next bear market” writes Brett Arends for marketwatch.com. Potentially the best way to protect against a market slump is to buy insurance in the form of “put” options on a broad market index like the S&P 500.Some very long-term Treasury bonds doubled in value or better during the 2008 financial crisis.Long-term Treasury bonds have typically offered a more dynamic form of protection.With the S&P 500 trading around 2600 right now, put…

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7 ESG picks for stock-market investors that don’t cost in returns

“Jon Hale, head of sustainability research at Morningstar, says there are now around 230 funds and ETFs that have an ESG or sustainability theme” writes Howard Gold for marketwatch.com. Hale prepared a spreadsheet for MarketWatch that listed all the funds and ETFs in Morningstar’s universe that have sustainability or ESG themes.More and more institutional investors are incorporating its principles into their investment selection process and putting ESG-focused assets into their portfolios. Source: marketwatch.com Share This:

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Why stock-market investors should be worried about the junk-bond market

“Kass believes stock market investors are burying their heads in the sand about what the junk bond market is telling us” writes Mark Hulbert for marketwatch.com. Read: The bond market still hasn’t learned the lessons of Toys R Us and Puerto Rico George Putnam agrees.That’s not much compensation for the considerably higher risk associated with junk bonds.He is editor of The Turnaround Letter, a contrarian service that becomes interested in junk bonds only when they are hugely out of favor.An economic downturn would be fatal to many of them, and…

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Dow off nearly 200 points, but stock-market internals suggest market isn’t panicky

“Despite the firm selloff in the major indexes from record highs Thursday, the Arms Index, used to measure buying or selling intensity, suggests investors are in a buying mood” writes Mark Decambre for marketwatch.com. On big down days, the Arms tends to rise above 1.000, as the ratio of down volume to up volume rises relative to the ratio of declining stocks to rising stocks. Those moves came as the CBOE Volatility Index VIX, +21.78% a measure of implied volatility, jumped 16% to trade at 11.35, still far below its…

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Why tax cuts won’t ‘make or break’ stock-market rally

“See: Here are the winners and losers of the tax plan, by income bracket Stocks put in a mixed performance Thursday in the wake of the unveiling” writes Deputy Markets Editor for marketwatch.com. On the individual side, the plan would compress the number of income tax brackets and fully repeal the estate tax by 2024.As a result, Nomura lowered its assessment of the likelihood of “comprehensive reform” passing from 30% to 20%, but left the probability of “simple tax cuts without significant reforms” at 60%.Ultimately, tax cuts, specifically repatriation and…

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Why stock-market bulls should be wary of rising tide of earnings shenanigans

“Of those companies, 80% reported higher earnings per share under the non-GAAP approach, he said” reports foxbusiness.com. As noted by MarketWatch’s Francine McKenna, the Securities and Exchange Commission earlier this month published a lengthy update to its May 2016 guidelines on nonstandard accounting metrics.Arone said the differences demonstrate Wall Street’s comfort with “accounting gimmicks that can exaggerate earnings strength. Source: foxbusiness.com Share This:

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What could derail the stock-market rally?

“According to FactSet, third-quarter net profit margin so far has edged only slightly lower compared with profit margins in the third quarter last year” reports foxbusiness.com. Historically, net profit margins tend to peak along with the stock market, as seen in the chart below.On absolute terms, however, a net profit margin at 9.5% is close to the record.Ogg suggests the danger lurks in a sudden drop in profit margins. Source: foxbusiness.com Share This:

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