Web Statistics the financial sector - financial sector analysis

Sunday, 21 May 2017

the financial sector - financial sector analysis


the financial sector - financial sector analysis

"the financial sector - financial sector analysis" 

in the news the financial sector - financial sector analysis? What this all about..... See below. 

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Sentiment Trader can see A domino effect from the bond market could lead to a correction in stocks. We will see.... There are no guarantees with this stuff. 

U.S. Treasury yields are hovering near one-month lows and a significant move lower may trigger a correction in equities. First there is an important chart. 

Sectors like financials could be threatened, adding the best-performing groups of the year "will top out at some point, and leave the broader S&P 500 Index vulnerable to a more material correction later this year.

The reflation trade centers around stocks that benefit from higher inflation and yields, including financials. Investors and traders have been betting that inflation will rise under Donald Trump's presidency as he moves to enact an agenda that includes lower corporate taxes and infrastructure spending.

The Financials Select Sector SPDR Fund ETF (XLF), which tracks the S&P financials sector, has been a stalwart since Trump's victory, rising more than 17 percent since Nov. 8. However you can see that the Chart is starting to depict a head and shoulders pattern, and which is seen in the books of the best technical analysts as not being a particularly strong chart pattern going forward. So it could be a bit of a warning sign shorter term.  



But the reflation trade has been under siege lately because of the decline in rates. The benchmark 10-year note yield has fallen from about 2.41 percent to 2.24 percent since May 10 and hit a one-month low on Wednesday. Financials, meanwhile, suffered their worst day since June 24 earlier this week on the back of the U.S. stock market's worst session of 2017.

Stocks fell sharply on Wednesday on news that former FBI Director James Comey put together a memo outlining a conversation in which Trump asked him to halt an investigation into Michael Flynn's ties with Russian officials. Flynn is Trump's former national security adviser.

Hunter noted that if yields fall, sectors like financials could be threatened, adding the best-performing groups of the year, technology and consumer discretionary, "will top out at some point, and leave the broader S&P 500 Index vulnerable to a more material correction later this year."

One could adopt a much more defensive bias if the market internals do not improve in the weeks ahead, the leadership groups start to form bearish momentum divergence patterns, and we are looking at certain levels as the market target zone this summer."

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