Market Averages Reach All-Time High

Originally posted in the Daily Journal of Commerce, Portland OR

Published April 8, 2013
William RutherfordBoth the Dow Jones industrial average and the S&P 500 average reached all-time highs in the first quarter of 2013. The Dow jumped 11.25 percent for its best first quarter in 15 years. The S&P moved up 10 percent, finishing the quarter at 1,569.19 and eclipsing the previous high of 1,565 set 5½ years ago. The NASDAQ closed up 8.21 percent year to date at 3,267.52 and reached a 52-week high, but it’s far from its peak. Of course, these “highs” are not adjusted for inflation, and will have to be higher to claim higher real returns.

Meanwhile, 30-year Treasury bonds declined 3.1 percent for the first quarter, with the broader bond market declining 0.3 percent. In March, bonds declined 0.1 percent versus a return on equities of 3.75 percent. This is consistent with my previous admonition regarding bonds and the pressure they will be under as interest rates rise.

Previously I remarked that a movement from bonds to equities is expected as the Fed policies continue to favor equities. Investors have been forced to take more and more risk to find yield, and this will not end well. Bond exchange-traded funds are taking more risk; money market funds, normally thought to be a safe haven, are forced to take more risk.

The averages reached these new records in spite of year-end wrangling over the budget in Washington. First, the so-called “fiscal cliff” fixated the markets, but then came and went. Then sequestration loomed, and that was thought to mean the end of the rally. But the market just shrugged. Another crisis […]

April 10th, 2013|Categories: Daily Journal of Commerce|Tags: , , , , , |Comments Off on Market Averages Reach All-Time High

Bill Rutherford Quoted In Dow Jones

Consumer Staples, Health Care Seen As Recessionary Havens

by Mary Ellen Lloyd, Dow Jones Newswires; 704-948-9145; maryellen.lloyd@dowjones.com

A year into the U.S. recession, the smart money on Wall Street says traditionally defensive sectors such as consumer staples, health care and telecommunications remain among the best bets.

That’s because it is businesses like drugstores, food producers, managed-care companies, and beer and cigarette makers that tend to do well despite tough economic times, according to several market strategists, money managers, economists and fund data managers.

“You’re dealing with industries and companies that provide necessities – everything from toothpaste to stents to pharmaceuticals to cereal,” said Brian Belski, Merrill Lynch’s U.S. sector strategist.

And some not-so-basic items can feel like necessary luxuries for folks during times of stress. “People tend to drink and smoke more during recessions and slowing times in the economy and the stock market,” Belski said. […]

December 18th, 2008|Categories: Bill Quoted|Tags: , , , , , , , , |Comments Off on Bill Rutherford Quoted In Dow Jones

Bill Rutherford Quoted In Business Week

Inside Wall Street: Bring on the Cranes and Road Graders by Gene Marcial

http://www.businessweek.com/magazine/content/08_48/c4110insidewal446718.htm

The Dow Jones industrial average has plunged some 41% since its record close at 14,164 on Oct. 9, 2007—for a $1.7 trillion loss in market capitalization. And the broader Dow Jones Wilshire 5000-stock index has lost 46%, or $9.1 trillion. The huge sell-off is causing some strategists to figure that the market has already priced in a recession. Not only that, “it also has posted the worst performance entering a recession in over 60 years,” notes Jeffrey Kleintop, chief market strategist at LPL Financial. While volatility is likely to continue, history suggests additional significant downside is unlikely. “The stage is set for an eventual recovery, led by the early cyclical sectors,” predicts Kleintop. It’s well-known, he adds, that powerful gains in the stock market come well before the end of a recession. […]

Bill Rutherford Quoted By CNNMoney.com

CNNMoney.com

Dow sheds 486 points: Post-election worries about the weak economy are front and center.

by Alexandra Twin, CNNMoney.com senior writer

NEW YORK (CNNMoney.com) — Stocks fell sharply Wednesday, with the Dow sliding as much as 513 points, as Barack Obama’s historic victory gave way to renewed worries about the struggling economy.

The Dow Jones industrial average (INDU) lost 486 points or 5%. The blue-chip average lost as much as 513 points earlier. The Standard & Poor’s 500 (SPX) index lost 5.3% and the Nasdaq composite (COMP) gave up 5.5%.

Investors were taking a classic “buy the rumor, sell the news” response to President-elect Barack Obama’s victory over John McCain, said Bill Stone, chief investment strategist at PNC Financial Services Group. […]

Bill Rutherford In BusinessWeek

Business Week

Marcial: How Four Pros Played the Stock Meltdown

One waded into fallen bank stocks and shorted credit-card shares, another eyed health-care issues, a third bought countercyclicals—and a fourth sat tight

by Gene Marcial

What did investors do when the Dow Jones industrial average plunged 777.68 points, or 7%, on Sept. 29, to 10,365.45? Head for the nearest bar for a double? Or rush to double up, or down, on their stocks?

Either way, the Dow’s sharp response to the unexpected rejection by the House of Representatives of the Treasury’s buyout plan reminded investors yet again of how unpredictable and volatile the market can be.

“You’ve got to have a steel stomach to confront these types of markets—to survive or win,” says William Harnisch, president of hedge fund Peconic Partners, which manages some $1.5 billion in assets. And a winner he’s been at a time when most other hedge funds are struggling to avoid sinking. In 2007, Peconic posted a 64% gain, and this year is up 8% though Sept. 29, vs. a decline of more than 20% for the Standard & Poor’s 500-stock index. So Harnisch wasn’t one of those who scurried to the nearest tavern: He dared to buy stocks as the market plummeted. […]

Bill Rutherford Quoted In Barron’s

Earnings Estimates Still Too Lofty

By JOHANNA BENNETT

WHILE WALL STREET’S OUTLOOK for corporate earnings has grown more bearish by the day, the estimates are still not grisly enough.

Analysts have sharply cut their third-quarter and full-year financial profit estimates for companies in the Standard & Poor’s 500 since the summer, finally giving up on the notion that profits will climb much in 2008.

A poll by Thomson Reuters shows that the Street expects earnings to fall 2.3% in the quarter ending Tuesday from a year earlier. For the entire year, profits are expected to remain flat, a big change from the 6.7% gain analysts had forecast in July.

But some are skeptical about even those modest expectations and expect earnings to be down this year by as much as 8%. And there’s little confidence that the 22% gains predicted in 2009 will materialize given the uncertain economy, falling oil prices and the turmoil plaguing financial markets. […]

Bill Rutherford Quoted In CNNMoney.com

Stocks rally on housing rescue

Dow surges 290 points as investors consider what the Fannie and Freddie bailout means for the broader economy.

by Alexandra Twin, CNNMoney.com senior writer

NEW YORK (CNNMoney.com) — Stocks surged Monday, with the Dow gaining 290 points and the broader market also gaining as investors breathed a sigh of relief that the government has swooped in to bail out Fannie Mae and Freddie Mac.

The Dow Jones industrial average (INDU) added 290 points or 2.6%. The broader Standard & Poor’s 500 (SPX) index added 1.8%, paring its morning gains. The Nasdaq composite (COMP) added 0.6%, after climbing in the morning and then falling in the afternoon. […]

Bill Rutherford Quoted By Reuters

Reuters logo

US STOCKS-Techs rise, helped by falling oil price

by Walker Simon

* Oil price tumble helps techs, airlines, retailers
* Citigroup shares fall on CFO warning on write-downs
* Financials weigh on the broader market (Updates to midafternoon)

NEW YORK, June 19 (Reuters) – The Nasdaq rose on Thursday as top technology companies and other exporters benefited from tumbling oil prices, seen as easing strains on global economic growth.

But the Dow and the S&P 500 indexes were little changed, restrained by an extended slide in financial companies that was triggered by Citgroup’s warning of write-downs in subprime mortgages.

U.S. oil prices Clc1 fell $4.13 a barrel to $132.53 a barrel on the belief that demand will take a hit after China raised gasoline and diesel prices by 18 percent, its first domestic fuel hike in eight months.

Shares of big manufacturers, including Boeing Co (BA.N: Quote, Profile, Research, Stock Buzz) and DuPont Co (DD.N: Quote, Profile, Research, Stock Buzz), rose on the back of the lower oil prices. Retailers’ shares also benefited, with Costco Wholesale Corp (COST.O: Quote, Profile, Research, Stock Buzz) up 0.7 percent. Both sectors were helped by the view that lower oil prices would take less of a toll on business and consumer spending. […]