Japan stocks PLUNGE!
Tech stocks in correction - nearing bear market.
What does the crystal ball tell us? Where is the PPP?
PLUS we are now on Spotify and Amazon Music/Podcasts!
Click HERE for Show Notes and Links
DHUnplugged is now streaming live - with listener chat. Click on link on the right sidebar.
Love the Show? Then how about a Donation?
Follow John C. Dvorak on Twitter
Follow Andrew Horowitz on Twitter
DONATIONS ?
Warm Up
- OMG - Did you see that?
- Fear - blood in the streets
- Looking for someone to blame for the selloff
- Boeing news....Finally
Market Update
- RISK off - all risk assets (aside from bonds) down in August
- Bitcoin - CRUSHED - as with other cryptos - so much for safe-haven
- 13:1 Day Decliners to Advancers (that is pretty significant.
- Records broken - Worst day in 50 years for one stock
Where is the PPP?
- Now we are hearing about an emergency cut - looking for a 0.75% cut (Jeremy Seigel)
- Investors looking for a save - Plunge Protection Team!!!!!!!!!!!!!!
- Seems like Tuesday in Japan - PPP to the rescue - +10%
Bitcoin and ETH
- Seriously - takes it on the chin down 15% with global market sell-off
- What happened to it being a safe-haven - all but discounted at this point....
Japan's first increase in decades
- Actually, last increase was 2017 - so 17 YEARS OF LOW RATES
- The Widowmaker trade is finally working - but for how long?
- Japan's major stock market - YEN Up 11% since 7/11/2024 and the Nikkei is down 23% (28% at low on Monday) since 7/11/2024
- Carry-Trade (borrow Yen at low rate and reinvest) BLOWING UP
- WORST day for Japan's markets since Black Monday in 1987
--- The loss of 4,451.28 points on the index was also the largest in terms of points in its entire history.
-=-=-=-= This is not the first time Japan's central bank has caused this type of situation. Their entire investing and monetary process is very dangerous.
-=-=-=-=- - Japan's Nikkei had the best day since 2008 on Tuesday
Repercussions
- Stocks around the world got hammered - worrying about YEN unwind as well as the earnings and outlook from Tech
- Kospi -8% down Monday
- World stocks off by 3%+
- UGLY moves and lots of trading opportunities
- $1 Trillion in market cap erased from Mega-Caps Monday (Mag7)
AND
- A sharp drop in U.S. stocks is provoking selling from volatility-sensitive funds, exacerbating a selloff
- Volatility control funds - systematic investment strategies that typically buy equities when markets are calm and sell when they grow turbulent have gorged on stocks as indexes soared to record highs in 2024
- More recently, they have begun selling, as worries over the economy and tech earnings rattle investors: volatility control funds have dumped about $83.6 billion of U.S. equity futures over the last two weeks
VIX
- SPIKES to 65 on Monday morning.... (Then comes down to about 36 on the close)
- Historical spike like that are interesting signs that it may be end of route (or getting close)
- - 80's for Pandemic and peak of Financial Crisis
---- Unbelievable move in 3 days that seems that most people were unprepared for
Economic Issues
- Nonfarm payrolls grew by just 114,000 in July, below the downwardly revised 179,000 in June and the Dow Jones estimate for 185,000.
- The unemployment rate edged higher to 4.3%, its highest since October 2021, triggering an economic rule on recessions.
- Health care again led, adding 55,000 to payrolls. Other notable gainers included construction (25,000), government (17,000), and transportation and warehousing (14,000).
- Average hourly earnings increased 0.2% for the month and 3.6% from a year ago. Both figures were below respective forecasts for 0.3% and 3.7%.
Google loses Anti-Trust
- Google’s payments to make its search engine the default on smartphone web browsers violates US antitrust law, a federal judge ruled Monday,
Tech stocks in correction - nearing bear market.
What does the crystal ball tell us? Where is the PPP?
PLUS we are now on Spotify and Amazon Music/Podcasts!
Click HERE for Show Notes and Links
DHUnplugged is now streaming live - with listener chat. Click on link on the right sidebar.
Love the Show? Then how about a Donation?
Follow John C. Dvorak on Twitter
Follow Andrew Horowitz on Twitter
DONATIONS ?
Warm Up
- OMG - Did you see that?
- Fear - blood in the streets
- Looking for someone to blame for the selloff
- Boeing news....Finally
Market Update
- RISK off - all risk assets (aside from bonds) down in August
- Bitcoin - CRUSHED - as with other cryptos - so much for safe-haven
- 13:1 Day Decliners to Advancers (that is pretty significant.
- Records broken - Worst day in 50 years for one stock
Where is the PPP?
- Now we are hearing about an emergency cut - looking for a 0.75% cut (Jeremy Seigel)
- Investors looking for a save - Plunge Protection Team!!!!!!!!!!!!!!
- Seems like Tuesday in Japan - PPP to the rescue - +10%
Bitcoin and ETH
- Seriously - takes it on the chin down 15% with global market sell-off
- What happened to it being a safe-haven - all but discounted at this point....
Japan's first increase in decades
- Actually, last increase was 2017 - so 17 YEARS OF LOW RATES
- The Widowmaker trade is finally working - but for how long?
- Japan's major stock market - YEN Up 11% since 7/11/2024 and the Nikkei is down 23% (28% at low on Monday) since 7/11/2024
- Carry-Trade (borrow Yen at low rate and reinvest) BLOWING UP
- WORST day for Japan's markets since Black Monday in 1987
--- The loss of 4,451.28 points on the index was also the largest in terms of points in its entire history.
-=-=-=-= This is not the first time Japan's central bank has caused this type of situation. Their entire investing and monetary process is very dangerous.
-=-=-=-=- - Japan's Nikkei had the best day since 2008 on Tuesday
Repercussions
- Stocks around the world got hammered - worrying about YEN unwind as well as the earnings and outlook from Tech
- Kospi -8% down Monday
- World stocks off by 3%+
- UGLY moves and lots of trading opportunities
- $1 Trillion in market cap erased from Mega-Caps Monday (Mag7)
AND
- A sharp drop in U.S. stocks is provoking selling from volatility-sensitive funds, exacerbating a selloff
- Volatility control funds - systematic investment strategies that typically buy equities when markets are calm and sell when they grow turbulent have gorged on stocks as indexes soared to record highs in 2024
- More recently, they have begun selling, as worries over the economy and tech earnings rattle investors: volatility control funds have dumped about $83.6 billion of U.S. equity futures over the last two weeks
VIX
- SPIKES to 65 on Monday morning.... (Then comes down to about 36 on the close)
- Historical spike like that are interesting signs that it may be end of route (or getting close)
- - 80's for Pandemic and peak of Financial Crisis
---- Unbelievable move in 3 days that seems that most people were unprepared for
Economic Issues
- Nonfarm payrolls grew by just 114,000 in July, below the downwardly revised 179,000 in June and the Dow Jones estimate for 185,000.
- The unemployment rate edged higher to 4.3%, its highest since October 2021, triggering an economic rule on recessions.
- Health care again led, adding 55,000 to payrolls. Other notable gainers included construction (25,000), government (17,000), and transportation and warehousing (14,000).
- Average hourly earnings increased 0.2% for the month and 3.6% from a year ago. Both figures were below respective forecasts for 0.3% and 3.7%.
Google loses Anti-Trust
- Google’s payments to make its search engine the default on smartphone web browsers violates US antitrust law, a federal judge ruled Monday,
Activity