September 28, 2018
10:00 am EDT
At SIA Wealth Management everything we do is based on Relative Strength Analysis. We evaluate the Relative Strength between asset classes giving us insight into money flows on a large scale, and from this select top ranked investments.
Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428
Note the Morning Minutes will not be issued on Monday. They should return onÂ Tuesday October 2.
Itâ€™s the last trading day of the week, month and quarter, and investors appear to be in a profit-taking mood with the Dow and the S&P/TSX both down about 0.25%.
This weekâ€™s market decline appears a bit odd on the surface as broad market related news has been positive for the most part. Yesterday, US GDP growth at 3.3% and durable goods orders growth of 4.5% were well above street expectations. Overnight, Japanese retail sales growth of 2.7% and other key indicators were better than expected. This morning, Canada GDP growth over month of 0.2% for August beat the street but UK GDP of 1.2% fell slightly short of expectations.
The US Chicago PMI report, a widely watched leading indicator for the national PMI numbers due on Monday, just came out. The 60.4 reading is down from last monthâ€™s 63.6 and below the 62.5 street estimate but still relatively strong. US indices are holding steady on this news.
With the Hang Seng down 0.65% and the Dax down 1.3% itâ€™s possible the global decline may be related to a sense that perhaps things canâ€™t get any better and could be about to get worse. Trade tensions have been ramping up this week between the US and China, and President Trumpâ€™s UN speech ramped up the US go it alone rhetoric, throwing long-standing alliances and relationships under the bus. Meanwhile in Europe, Italyâ€™s populist coalition government could be heading for a showdown with the EU over a higher deficit budget.
US-Canada trade talks face an October 1 deadline. The Trump administration has been making all kinds of negative personal comments about Canadaâ€™s negotiators, but at the same time Congress has to approve any deal with Canada or Mexico and they have to face their voters in the midterm elections in just over a month. Whether a deal happens or not and whether new auto tariffs are launched should things go off course have a big impact on trading in the Loonie and Canadian stocks over the next several days.
Tesla Motors shares have gone off a cliff this morning plunging 10.0% in early trading. Yesterday the SEC launched a suit against CEO Elon Musk related to his August tweet about taking the company private at $420 per share that never materialized. The SEC is alleging Musk made â€śfalse and misleading statementsâ€ť that caused investor harm (short squeeze when the shares spiked and then the selloff when the supposed deal fell apart) and is looking to have Musk barred from serving as a director or officer of a public company. This fiasco is likely going to end up in the business textbooks as a cautionary example of why we have rules and protocols around the public disclosure of
material news including halting the stock or making an announcement outside of market hours, and issuing a press release so that everyone has access to the information at the same time
SIA Wealth in the Media:
Colin Cieszynski was quoted by Dow Jones in Marketwatch.com weighing in on yesterdayâ€™s stock market gains:
Stock market closes higher as investors focus on upbeat economic data
Disclaimer:Â SIA Wealth Management Inc. (SIAWM) specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.