Well last week was quite an exciting week in equity markets–for better or worse I had a wedding to attend in Kansas so left town midday on Tuesday and returned Saturday evening. Probably good to be gone that way I wouldn’t do something foolish.
The S&P500 moved lower by over 100 points–down by 113 points from the close the previous Friday. The index was down by 220 point from the high point for the week. The index is now down 5.7% from its all time high–not really much of a correction. I would think that a bounce of medium magnitude would come around in the next day or two. Right at this moment (6 p.m. central, Sunday) the futures market is showing more losses with the S&P500 off by around 3/4%–we’ll see what happens in the next 12 hours—obviously the selloff from last night has only worsened with equity futures off by around 2-3% now (6 a.m. central).
Interest rates are another thing–what a plunge the 10 year treasury took for the week. Ending at 3.79% the yield was down 41 basis points on the week. Like equities yields are likely to get at least a ‘dead cat bounce’ in the next couple of days. This week we don’t have any of the normal ‘critical’ economic releases (i.e. CPI, Employment, PCE) so one might think markets would be quiet, but folks are running around now yelling ‘the Fed is waiting too long’ or ‘looks like a hard landing is coming’ so we’ll see what happens. Right now with equity futures off sharply this morning the 10 year treasury is off 4-5 basis points at 3.75%.
The federal reserve balance sheet took a nice tumble with assets down by $27 billion on the way to $7 billion in a couple months.
Last week, as I had mentioned, $25/share preferreds and baby bonds held up very well. With the plunge in interest rates one would expect that income issues would hold up–BUT at some point the ‘baby goes out with the bath water’ and today may be such a day.
The average $25/share issue rose 1 measly penny last week with investment grade issues rising 6 cents, banking preferreds rose 5 cents with mREIT preferreds off by 3 cents and shipping issues fell by the largest amounts – 13 cents, which reflects recession fears.
I switched over to 90% cash last month, treasuries and cds. Could not stomach the idea of large losses so late in the game. I’ve gone through too many upheavals to know I’d rather clip safe coupons than keep holding sizable paper losses. I’ll slowly build up my preferreds sock drawer again. I’m glad to see everyone, the old timers, still going strong.
Hster, there has been 2 different camps here on III the camp of capital appreciation and protecting capital. The other camp has been about trying to lock up income. I have tried to work on a combination of the two. I don’t log in to accounts on my phone. But just looking at different holdings today on Yahoo I see early morning sell off on things I own then a recovery throughout the day. This tells me what I own is valuable enough that others are taking advantage of the drop to buy what I own. I know I had losses, but a lot of what I have I bought at lower prices like today. The best part is I am still collecting the income
Hi Charles, I’m glad your holdings are good enough to buy on the way down. I wish I had that kind of limber mindset to act on sales but I’m going to have to be content with locking up income. I guess I’m just happy to hoard some low performing BBB banking prefs that pay less than 5.5% so I can forget about it. I was asleep last year and missed the juiciest of juicy yields.
I understand what you’re saying Hster.
But for example like several others I bought ATHS yesterday partly to add to an existing holding but to also lower my cost average. You might as well say it’s perpetual as it doesn’t mature until 2064 by that time I will be worm goo. But it does pay me a little over 7.25% and it resets in 5yrs to 5yr treasury plus 2.98 which I used to think was kinda low for a reset, but we have plenty of time to see how it goes over the next 5yrs to see if it’s a hold or trade. I also collect the next upcoming divy. Yes it is owned by ALPO that is not a spelling mistake but a reference. At some point PE companies have been known to do IPO’s and offer part of the company to the public to capitalize on their investment. Overall I consider this holding a moderate risk in the event of a recession and the fed dropping rates even if for a short time.
But as you say how long can I play the game. I am not talking about trading, but being alert to what I own.
No problem with Schwab or TOS, there were some quirky balances early this morning but that’s all straight now. I received about fifty alerts this morning and got six GTC fills.
got into Fido on second try, picked up some TECTP at 10 – 10.02. Think I’ll tune out for the rest of the day. TS Debby hitting Big Bend Fla., we’re in Jax, waiting for the wind, water and local flooding this evening. Stay safe, everybody, in the market and elsewhere.
Market doesn’t need a circuit breaker, just don’t let anyone log into their accounts!. The panic will get worse.
Hope everyone had their trades set up ahead of time.
This was the panic I was waiting for. Be careful what you wish for.
Signing off
Charles M,
I expect more lows to come.
The 2 wars are getting hotter and both could affect OIL and GAS prices.
I haven’t bought or sold today.
Good hunting
OK OK
I picked up 15 WFC-L at 1196
I don’t think I will regret it.
Slowly edging back to Preferred from CD’s
Anybody else having trouble logging into their SCHWAB account??? I’ve tried now to log in 10 times & it just says “try later”.
LOL warned everyone. Schwab has me on hold. Vix hit 61 and DJIA down 1000 at one point.
Fidelity is giving a warning server is down.
Oh well, accounts will be down at end of the day and probably some GTC bids will have filled.
I am having the same problem. Unable to log into my Schwab accountt.
Website problems are reported at: Schwab, Fidelity, Vanguard, Ameritrade, E-trade, Robinhood and Interactive. (Down detector ) Stamps dot com, Wells Fargo and Chase also have similar spikes. So I wouldn’t rule out an underlying problem with a server provider like AWS.
my FIDO is working fine, just ‘cost basis’ field is not updating to average in new buys to my basis. One thing..when Schwab gets back online will that add to the waves of selling??? market is up from earlier lows, ISM services was stronger this AM, yields bounced up on that. Bea
Oh boy, even Fidelity is giving a server error! Bet both Schwab and Fido can’t handle the volume.
I am getting a “Bad Gateway” blank screen trying to access Vanguard