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Dow soars as Wall Street bears retreat to their caves

Written By | Nov 16, 2017

WASHINGTON, November 16, 2017 – After days of battering by resurgent bears, Wall Street’s bulls have returned, at least for the day. The rampaging bears are heading back to their caves to hibernate this morning, as the Dow rockets ahead for a 200 point gain (+.83 percent) as of Thursday noon, ET.


Read also: Trading Diary: Battered shares of Apple (AAPL), Allergan (AGN) rise again


Other major averages are also getting a bid, including the broader-based S&P 500, up 20.52 (+ 0.8 percent) and the tech-heavy NASDAQ, up 77.52 for a whopping 1.26 percent gain.

Notes CNBC Thursday morning,




“Stocks ‘are bouncing back this morning in what is proving to be a year of amazing of resilience for the asset class and silencing the bears,’ said Nick Raich, CEO of The Earnings Scout. ‘Market bears had one eye open yesterday, but are slipping back into hibernation.’”

Hey, Nick, I already said that about the bears. The real question is, will the bears stay put in their caves long enough for us to get a year-end Santa Claus Rally going?

Different analysts have different reasons for this Thursday morning mood change. They include impressive quarterly results from Dow components Cisco Systems (symbol: CSCO) and mega-retailer Walmart (WMT), which is holding its own against its online rival Amazon (AMZN), consistently refusing to go the way of onetime retail giant Sears (SHLD), which is sinking slowly into the sunset.

Again, CNBC:

“‘Overall the F3Q result suggests investments continue to favorably impact comp growth and shows Walmart is effectively competing in a tough retail environment,’ Mark Astrachan, an analyst at Stifel, said in a note.

“Cisco also reported earnings and revenue that beat Wall Street expectations, lifted in part by strong sales of software applications. Cisco shares popped 6 percent and were on track for their best session since Feb. 11, 2016.”

Aside from SCSO and WMT, also encouraging the bulls is the distinct possibility that Republicans may actually pass some kind of tax package when they return from next week’s scheduled Thanksgiving recess.

With apologies to my Catholic friends, I’ll take the St. Thomas approach on this one. Unless I can touch and feel a real piece of this tax cut legislation – after it’s been passed by both houses and signed by President Trump – I will refuse to believe it. On the other hand, if this one turns out to be another Republican fail, I’ll have to regretfully assume a big 2018 victory by the Evil Party (once known as the Democrats) in next year’s Congressional elections.

Fingers crossed. But at least at this moment, bulls are looking for the GOP to finally notch a victory, if not for The Donald, then at least for The Gipper. Another new Dow high awaits. Or so we can hope.

I’ve been absent again for a few days due to continuing medical issues, which, happily, finally seem on the verge of resolution. In the scheme of things, these issues have been relatively minor. But as is true with many chronic maladies, this one sapped a good bit of vitality. Recent market action certainly didn’t help, as some of my recent portfolio moves seemed poisoned from the outset.




On the other hand, this is the misery that sometimes goes hand-in-hand with personal investing. It’s likely why a great many investors choose funds over watching what’s really going on in their own portfolios.

What is becoming evident, however, is the increasing efficacy of deploying funds into targeted index ETFs as a way of smoothing out extremes in individual portfolios.

While I’ve had at least three monster gains in FY17 investments so far, I’m also experiencing one major setback at the moment. In the meantime, I’m up an impressive 13+ percent on the year in Schwab’s large cap growth ETF (SCHG), which Schwab customers can buy or sell without any commission.

It’s weeks like this one that make me wonder sometimes whether assembling a portfolio of consistently high-performing ETFs mightn’t be less stressful than contending with all the other gladiators striding boldly forward in the Wall Street Coliseum. On the other hand, the battle would be considerably easier if the Dow started marching reliably ahead once again.

 

Terry Ponick

Terry Ponick

Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17