Stock Market Rally Surges Ahead: Less Damage Than Expected From Hurricane IRMA, No Missile Firing By North Korea Over The Weekend; Expectations That The Fed May Be On Hold The Rest Of 2017 — All Fueled Yesterday’s (Sept. 11) Stock Market Rally
The most hated and under-appreciated bull market in stocks remained on solid ground yesterday, September 11, 2017, as the bulls were out in full force. The trading day ended with all three indices strongly in the green; and, yesterday’s rally was broad and deep — with four stocks advancing for every one down. One rarely knows for sure what spurs a market melt-up, nor a market sell-off, but most traders attribute yesterday’s strong rally to less damage from Hurricane IRMA in Florida than initially feared, North Korea failed to launch a missile on Saturday — despite widespread speculation they would, as the country celebrated the anniversary of its founding; and, many traders and institutions think that the U.S. Federal Reserve is done raising interest rates for the remainder of 2017. Goldman Sachs, among other financial investment firms, is forecasting that U.S. GDP could take a hit of 1.5 percent to overall U.S. GDP in the third quarter, as a result of both hurricanes Harvey and IRMA. And, the rally was on.
A big event to watch today is the unveiling of the much anticipated new iPhone, iOS 11, with the iPhone X being the most expensive new iPhone yet; and, the most anticipated. It is expected to sell for around $1,000, and be available as early as the end of this month/early October. Apple is also expected to introduce the new 4K Apple TV; as well as Apple iWatch Series III, which will include new health/exercise tracking features. This newest iPhone will also be much harder to hack and will pose a greater challenge for law enforcement, intelligence agencies, and others.
Of note according to Kensho Analytics, if you bought Apple stock the day of the announcement for a new iPhone and sold that stock 60 days later that same year, In 2013 you would have made a 19 percent gain; while in 2014 you made a 7 percent gain; and, in 2015, you saw a 6 percent loss. Just something to potentially keep in mind if you consider buying, or adding to a position in Apple, after today’s announcement. CNBC will cover Apple’s event live starting at 10:00 EDT tomorrow (Tue./Sept. 12) at Apple’s new +1B headquarters in Cupertino, California, and in the new — Steve Jobs Theater. There have been reports that there could be production/supply issues with the new iPhone — so, traders and investors will be watching closely as to what Apple’s CEO Tim Cook has to say on these potential hiccups.
Yesterday morning, Monday, I moved 25 percent of the 30 percent I had in cash back into the market, based on the strong futures showing pre-open. I now have only 5 percent in cash. I will still remain cautious and nimble; but, it is very hard to fight this market; and, all things being equal, the trend is your friend and this market is going higher, at least for now. I will remain on a hair trigger, because mu portfolio for the year is now +33.34 percent ytd.; and, I want to try and not lose that kind of gain, or at least limit the damage. Futures are up strong again this morning, Tuesday, September 12, and a strong reaction to Apple’s announcement today, will make a big difference on how we end the trading day. Good luck. V/R, RCP