Browsing articles tagged with "peruzzi's perch Archives - Mischler Financial Group"
Trump’s “Phenomenal Tax Plan” Pushes Equities Higher..For How Long?
February 2017      Equities Market Commentary   

Peruzzi’s Perch – Feb 10 2017- Phenomenal Tax Plan ; Global Central Banks Fragmentation

 

larry-peruzzi-mischler-equitiies

Larry Peruzzi

U.S markets spent most of the week listening to noise out of Washington regarding Travel Ban legal challenges and cabinet appointment nomination hearings. With little in terms market moving economic data financial markets were trying to determine if recent run up to record levels left assets overvalued. Wednesday that noise turned to music as a Trump Olive branch letter to China’s President Xi Jinping promised a “constructive relationship”.

The letter, coupled with Trump promises of ‘Phenomenal’ tax plan pushed U.S markets to fresh record highs. So while fears grow that the U.S foreign policy is leaning more toward protectionism and isolationism, market friendly fiscal policy is allowing us to look past the noise.

An interesting global central bank story is developing where monetary policy is beginning to become independent of each other. Some Central Banks are now raising, some are cutting, many still standing put; but we are no longer moving in lockstep.

This should create many global trading opportunities in fixed income securities. Earnings season will continue to wind down with 67 companies (heavy in techs) reporting next week. Economic releases next week will give the FED a clearer picture on inflation with Tuesday’s PPI, Wednesday CPI and retail sales and Thursday’s housing starts and building permits.

Although, recent releases statements have indicated the FED is happy to hold rates unchanged a little longer. FED Chairwomen Yellen has a full week as she appears before Senate Banking Panel on Tuesday followed by her Semi-Annual testimony to the House Panel on Wednesday. Investors are also starting to look at valuations as the S&P 500 P.E ratio rose to 21.2. We have seen it higher, but as we approach a P.E of 24 and 25, many will be looking to book some profits.

So, overall investors will continue to dance with the market as long as the music continues, but watch those valuations and inflation indicators.

Larry Peruzzi

Managing Director International Trading

Mischler Financial Group

Investment Banking | Institutional Brokerage

Ph:   1-617-420-8472

Larry Peruzzi is a 20 yr global trading markets veteran and brings a unique perspective to global equities market commentary via Mischler Financial Group, the securities industry’s oldest minority broker-dealer owned and operated by service-disabled veterans.  Larry’s experience  and best execution perspective stems from his sitting on ‘both sides of the aisle.’  For more than half of Larry’s career, he ran buy-side trading desks for Standish Mellon and thereafter, The Boston Company. In both of those roles, Larry was responsible for implementing and managing international equities trade execution. Larry’s perspectives are frequently cited by the leading financial news publishers, including The Wall Street Journal, Bloomberg LP and Reuters

Mischler End of Week Equities Market Commentary via Peruzzi’s Perch Feb 10 2017 end-of-week edition is distributed via email to institutional investment managers and Fortune Treasury clients of veteran-owned broker-dealer Mischler Financial Group, the investment industry’s oldest and largest minority broker-dealer owned and operated by Service-Disabled Veterans.

Peruzzi’s Perch is a weekly synopsis of Everything Equities as seen from the perch of Mischler Financial Group’s International Equities Desk. Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”, Peruzzi’s Perch is one of four distinctive content pieces produced by Mischler Financial Group.

To receive Peruzzi’s Perch, please contact Larry Peruzzi, Managing Director, International Equities via email: lperuzzi@mischlerfinancial.com or via phone. (more…)

Trump’s Tweet-Driven Policy Approach Propels Stock Prices; Can This Continue?
January 2017      Equities Market Commentary   

Peruzzi’s Perch – Jan 26 2017- Forget About Fed Policy and Rates- Equities Markets Are All About Trump Tweets (Still?!)

larry-peruzzi-mischler-equitiies

Larry Peruzzi

U.S. equity markets close the week in record territory, as the Dow Jones finally crosses the 20,000 Maginot line on Wednesday. Fueled by business friendly policy and rhetoric out of Washington, relatively inexpensive energy, improving corporate earnings and low rates the Dow recorded 2nd fastest 1,000-point move in history (42 days). What was a FED/rate driven market, which was preceded by the Oil driven market, has been replaced by a Presidential policy/tweet-driven market.

This week we saw rallies in cement and steel stocks when President Trump signaled he was forging on with his boarder wall as well as rallies in energy stocks when the Keystone and Dakota XL pipelines were reopened. Across the border Mexican stocks even lost 1.4% on Thursday after Mexican President Enrique Peña Nieto canceled a scheduled meeting at the White House. Fed watching has been replaced by Tweet watching and so far, the equity markets like what it is seeing. Historically when markets cross into record territory we normally see a brief pause while analyst access valuations. Additional positive news was received after the close on Thursday as earning from Microsoft, Intel and Alphabet beat estimates. As of Thursday 161 of the S&P 500 names have reported with 120 (74.5%) reporting a positive surprise and 38 (23.6%) reporting a negative surprise.

Next week 24 S&P 500 companies are scheduled to report earnings. The reporting firms are dominated by retailers.  It will also be an important week economically with Dallas Fed activity on Monday, Chicago Purchasing managers on Tuesday, a FOMC rate decision on Wednesday (no change expected), productivity and labor cost on Wednesday and the ever important January employment report closing out the week on Friday. The FED Funds rate, despite Chairwoman Yellen calls for increased magnitudes of rate increases, is not expected to change. Fed funds are only pricing a 14.5% probability of a rate hike for Wednesday’s FOMC meeting. Friday’s employment reported should see a lot of attention. A positive report is sure to be met by the suddenly customary round of tweets and promotion.  It may however be a tad bit early to put much emphasis on the report. The April, May and June reports should be much better harbinger of the effectiveness of the Trump agenda toward job creation. With the Dow Jones now over the 20,000 level, after 6 failed attempts in December and January, we will be looking for signals on the strength and sustainability of the bullish sentiment. There are some concerns over Trump’s protectionism and the recent decline in the U.S dollar has made some foreign investors nervous. Global markets are in rally mode but with European referendums this spring, trade agreements being rewritten and rising political tension there is uneasiness about it.

Asian Markets are expected to be quite as the Lunar New Year holiday commences Friday. Chinese markets will remain closed until next Friday. 2017 is the year of the Rooster. The Rooster is almost the epitome of fidelity and punctuality. Investors would be well served by being loyal to facts and details on their trades and in being punctual, as we have entered a market environment never seen before.

Larry Peruzzi

Managing Director International Trading

Mischler Financial Group

Investment Banking | Institutional Brokerage

Ph:   1-617-420-8472

Larry Peruzzi is a 20 yr global trading markets veteran and brings a unique perspective to global equities market commentary via Mischler Financial Group, the securities industry’s oldest minority broker-dealer owned and operated by service-disabled veterans.  Larry’s experience  and best execution perspective stems from his sitting on ‘both sides of the aisle.’  For more than half of Larry’s career, he ran buy-side trading desks for Standish Mellon and thereafter, The Boston Company. In both of those roles, Larry was responsible for implementing and managing international equities trade execution. Larry’s perspectives are frequently cited by the leading financial news publishers, including The Wall Street Journal, Bloomberg LP and Reuters

Mischler End of Week Equities Market Commentary via Peruzzi’s Perch January 26 end-of-week edition is distributed via email to institutional investment managers and Fortune Treasury clients of veteran-owned broker-dealer Mischler Financial Group, the investment industry’s oldest and largest minority broker-dealer owned and operated by Service-Disabled Veterans.

Peruzzi’s Perch is a weekly synopsis of Everything Equities as seen from the perch of Mischler Financial Group’s International Equities Desk. Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”, Peruzzi’s Perch is one of four distinctive content pieces produced by Mischler Financial Group.

To receive Peruzzi’s Perch, please contact Larry Peruzzi, Managing Director, International Equities via email: lperuzzi@mischlerfinancial.com or via phone.

(more…)

Equity Market View Via Peruzzi’s Perch:Trump Tweets; Back to Active Management
December 2016      Equities Market Commentary   

Peruzzi’s Perch Dec 09 2016 : Equity Market View Dominated by Trump Tweets Aimed at Companies; Back to Active Management to Capture Alpha

larry-peruzzi-mischler-equitiies

Larry Peruzzi

We close out a remarkable week in which markets flirted with new highs daily. Wednesday was the 75th anniversary of the Pearl Harbor attacks. That event prompted Japanese Field Marshal Isoroku Yamamoto to say “I fear all we have done is to awaken a sleeping giant and fill him with a terrible resolve”. A fitting quote that could also ring true for the current state of global equity markets. The Trump victory and growing sentiment that market friendly policies are forthcoming have U.S indices hitting new all-time highs daily.

Volatility, as measured by the VIX index, is near the lowest levels of the year. We are seeing shorts being squeezed as investors are putting idle cash to work, albeit mostly by means of passive investing. The month of December has historically been the best performing month for the S&P 500. Since 1950 the S&P 500 averages a gain of 1.7% in December. This year we are firmly ahead of average with the S&P gaining 2.2% through the first 6 trading days. Normally we start to see some investors taking gains in December but with Trump’s pledge to reduce capital gain taxes, investors are holding off on selling. This will help add more fuel to the market, which in turn has pushed more sideliners into the market.

Since the Wednesday after the U.S election 392 of the S&P 500 names (505 companies) are trading higher.  Economic releases this week were mostly backwards looking, with the exception of Friday’s Michigan sentiment reading, which saw an uptick in both current conditions and expectations. Thursday the ECB announced that the stimulus package will be extended at a reduced rate of 60 billion Euros per month, but it will be extended for another 9 months. This was greeted positively by European markets.  South Korean President was ousted on Friday as South Korea joined the growing list of countries (U.K, Brazil, Italy, New Zealand, and Kuwait) whose leaders have stepped down this year.  Also Coca Cola CEO announced he is stepping down on May 1, 2017.

Looking ahead to next week, we have a quiet start to the Economic releases, but then we pick up the pace on Wednesday when the Federal Reserve is expected raise rates for the first time in a year. The thought of rising rates was a market mover earlier in the year, but the current momentum makes Wednesday Fed announcement largely a formality. The only way it will move markets is if it is a smaller or large hike than the currently priced in 25 bps.  The announcement’s wording should garner some interest.

Also making rate decisions next week will be: Bank of England, Switzerland, Mexico, Chile, Peru, Indonesia and South Korea. Other stats due next week are November retail sales and PPI data on Wednesday, Current account balance, November CPI data and jobless claims on Thursday. The week closes out with November Housing Starts and Building permits on Friday.

With crude oil back over $51 (up 13.6% since 11/29) a barrel at 2016 highs commodity traders will be watching the OPEC outlook discussion on Tuesday and inventory numbers on Tuesday and Wednesday. Gold start the week at its lowest levels since February and the 10 year Treasury yield at its highest level since July 2015. Look for the allocation trade to continue, but somewhat ease next week.

Oracle and Adobe Systems are the highlights of a handful of firms reporting on Thursday. We expect markets and market strategy to return toward a more active managed approach from our current passive approach. With the current rally pushing idle cash into the market, the next step is the search for alpha. So, starting to pay attention and analysis of fourth quarter earnings next month will be a good first step. The course of action next week seems to be: Put cash to work, watch President-elect Trump’s tweets and comments for policy resolve, see what the Fed has to say on Wednesday, mail out those Christmas Cards and get ready to roll up your active management sleeves in January.

Godspeed John Glenn

 

Larry Peruzzi

Managing Director International Trading

Mischler Financial Group

Investment Banking | Institutional Brokerage

Ph:   1-617-420-8472

Larry Peruzzi is a 20 yr global trading markets veteran and brings to Mischler a unique background. His career experience  and best execution perspective stems from his sitting on ‘both sides of the aisle.’  For more than half of Larry’s career, he ran buy-side trading desks for Standish Mellon and thereafter, The Boston Company. In both of those roles, Larry was responsible for implementing and managing international equities trade execution. Larry’s perspectives are frequently cited by the leading financial news publishers, including The Wall Street Journal, Bloomberg LP and Reuters (more…)