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Stocks gain Tuesday, ignoring the headlines to halt the September decline

Written By | Sep 22, 2020
Delta panic porn, malaise, September decline, ignoring the headlines

Cartoon by Al Goodwyn. Used with permission.

WASHINGTON – US stocks meandered around considerably Tuesday. It was as is Mr Market was trying to decide whether to keep bleeding red ink today or print some green ink for a change. As the afternoon wore on, stocks finally began ignoring the headlines, halting the September decline for now, and camping in the green zone for a change. As a result, we saw stock gain Tuesday.

The Dow closed up today a measly 0.52%. The S&P 500 did better, logging in a 1.05% improvement. And the beaten down, tech-heavy NASDAQ won the sweepstakes, closing up 1.715 on the day. Investors seemed finally to call a halt to our lousy September decline. (Maybe.)

Tom Bosley on the correction: A September decline that might be nearing its end

Tom Bosley, writing Tuesday morning in the free section of Stockcharts.com, seemed to predict the near future.

“In my Daily Market Report to EarningsBeats.com members, I pointed out a couple very positive short-term developments. First, the S&P 500 pulled back to 3229 yesterday, EXACTLY a 10% correction from its recent all-time high. Extremely bullish sentiment readings suggested that September would likely present challenges like we hadn’t seen since bottoming in March. That’s exactly what we’ve seen in September.”




This led Bosley to conclude that the market’s rapid cliff-dive into correction territory this month may be nearing its end. Which we think it is. But he also added a healthy caveat for investors inclined to get too excited. Yet.

“Could we see one more move lower? Yes. This is historically a very bearish week for the S&P 500 – the 3rd worst calendar week of the year since 1950. But the reversal on Monday was important as growth stocks saw tremendous buying throughout the session. The NASDAQ 100 ($NDX) closed more than 200 points above its open. That reeks of accumulation to me, not distribution.”

In other words, it might be just about nibbling time. That’s assuming you’d raised some cash earlier this month before the September decline was well underway.

Nibbling, nibbling like a mouse…

We did some nibbling of our own this morning. But very little of it, and on very few positions. We’re still a little suspicious that 2020’s sharp September decline could relaunch as early as tomorrow. That wouldn’t be difficult, considering the pounding stocks have endured this month. September is a traditionally bad month for stocks most years anyway.

It may be time to ignore the headlines. The scary ones in particular.

That said, plenty of uncertainty still looms ahead. A potentially rigged — by Democrats — election looms ahead. And, of course, a small legion of paid Antifa and BLM thugs remain ready to trash a neighborhood near you.  All this hardly inspires investor confidence, even if they choose to ignore the headlines aimed at igniting each individuals “fear factor.”

Certainly, the ceaseless negative PR put out by the media and “concerned scientists” alike concerning the novel coronavirus doesn’t help either. This effectively New Flu has been misreported and misrepresented all year. It’s a major reason for 2020’s ongoing September decline. Which is, as we’ve noted, due in part to a scientific community that issues at least 6 contradictory reports about the disease every single day. No one knows what to do. And this turns the the anxiety dial for most Americans up to 11 or higher.

September decline, ignoring the headlines

Theatrical poster for “The Blob” (1958). Lo res version of likely copyrighted poster via Wikipedia entry on the film. Fair use as metaphor in this article.

Remember The Blob?

All this contradictory “news” gets amplified and distorted by the media into visions of the 4 Horsemen of the Apocalypse riding hard down every city street, ready to lay a quick but painful death on every one of us. Or maybe they think the coronavirus is like the shapeless anti-hero of that classic horror flick, The Blob (1958). Nothing can stop it, and it’s sure to engulf us all. Maybe tomorrow.

Beating a dead, coronavirus horse

It’s all a load of horse hockey. But the media keeps at it. They keep the monster alive by harping on “case” numbers, which are mostly people who test positive for the virus in some way, shape or form, but never exhibit any signs of the disease. Which is the case with most who actually test positive. These numbers constantly go higher and higher, mainly because more and more people are getting tested. Being exposed to a virus is one thing. Actually developing a case, and a severe one at that, is even less frequent.

So, on the other hand, what we actually have to worry about – a bit – are actual deaths caused by the disease. Yet even these get routinely misreported, as many reporting hospitals attribute deaths to the coronavirus in people who may already have been on the verge of death, like those suffering from terminal cancer. That’s bogus counting, but it adds to the media terror campaign. Which, of course, is hyped endlessly as another tool in the never-ending campaign to defeat President Trump, lest he win another term. That’s why we all need to ignore the headlines. We need to think and act for ourselves.

All this is actually important to investors, which we’ll revisit in a moment.



ZeroHedge and Bank of America opine on Covid-19

But first, let’s read what ZeroHedge’s Twin Tylers have to say about the media and its willful distortion of US coronavirus numbers. (Bold text via ZeroHedge.)

“You wouldn’t know it reading the mainstream press, but in the past two months there has been a remarkable improvement in the covid pandemic in the US. Here are just two quick observations from the latest daily note by BofA’s [Bank of America’s] Hans Mikkelsen.

“With the number of people in the US hospitalized with Covid-19 down 52% in 59 days since the recent peak on July 23rd, the count is now nearly back local lows from mid-June.

“Meanwhile, even as the 17% increase in daily new cases over the past week (7-day average) is getting a lot of attention, this can be explained completely by more testing as the number of daily new tests is up 23% over the past week (7-day average). Another indication that the US is slowly winning the fight against the pandemic, the Covid-19 test positivity rate declined 0.2% to 4.6% over the past week (7-day average), the lowest in more than three months.”


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Time to resume a normal life. And a normal market

Which gets us back to the point of spending this much time on Covid-19 today. The simple fact is this: At least part of this September’s fast moving, serial market crash is due to increasingly negative sentiment concerning the nearness of that still mythical anti-coronavirus vaccine. Investors in general feel that the longer this takes, the longer the US economy will remain in lockdown mode. And thus, the longer it will take to revive the Trump economy into its accustomed robustness.

That’s a false equation. Investors, along with everyone else, need to resolutely ignore headlines, particularly ones meant to terrify us, and simply get back to business and to working on our 401(k)s and invesments. Despite the universal disease terror campaign we’ve endured since early this year, we could open everything back up again right now. And it wouldn’t make much difference with or without a vaccine. That’s because the coronavirus, like the flu, will now always be with us.  So screw this “surge” stuff. That’s only a guarantee of more scare headlines.

Keep in mind that each year’s ever-morphing edition of the flu does the same thing. It shows up every year, hangs around until every state gets infected, and then departs, usually in the spring, after killing off some 60-90,000 US citizens a year. Which, sadly but truthfully, is no longer a big deal. We’re used to it. Just like we’re used to the high chance of mechanized death we face every morning as we begin our commutes. Or at least when we had commutes to face.

Ignore the headlines and halt the September decline?

But you get the point. What’s happening now with the coronavirus is the same thing. And it will eventually be contained by some kind of annual vaccine which morphs along with the organism. Usually. So, like the flu, we’ll deal with it and move on.  And end the September decline. That, wrote Oscar Wilde in another context, is “the truth, pure and simple.”

When everyone cuts through the fake crap and grasps this simple truth, the two-bit dictators that busily keep us under house arrest might finally cut the crap. Then we can get back to normal again. We’ll get back to work pronto, do our thing, start paying our bills again.

Your vote might also help end the September decline. But in November…

And, oh yes, make a note on the calendar to vote in successive elections to vote out every single a-hole who’s made most of our lives a boring and depressing misery over most of 2020. We don’t need rulers. We need public servants. When this process begins, The Great Trump Rally will begin again. Assuming that Americans have cut through the crap and voted him back into office, defying the elites and the waves of Soros-paid thugs who want to destroy the past 250 years of the best country and the best government that man has yet devised.

And that’s the way to get the market back on track for a successful new decade. Anything else would be the kind of foolishness that courts absolute and total disaster.

We hope folks think about that before voting. And before putting too much money back into a market that can still turn on you in an instant.

– Headline image:  Cartoon by Al Goodwyn. Used with permission.

 

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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 Senior 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