Monthly Archives: April 2015

Market Recap

Earnings were the primary driver of the markets this week (we will address this below). Markets were all higher on the week, including the NASDAQ, which closed at an all-time high. As is customary when an all-time high is reached, media outlets begin calling for a “correction” or saying that the NASDAQ is “overvalued”. It is important to take these stories with a grain of salt, as simply reaching an all-time high is really no reason to cry out for a reversal. We must examine the underlying fundamentals. As you will see on the chart below from today’s Wall Street Journal, the NASDAQ 100 is much more diverse than it was the last time it reached this level in 2000. Also, the PE Ratio is much lower. While it is possible that a pullback could occur (for a large number of reasons), we are not at “bubble” levels by any stretch of the imagination. Continue reading

Greece Default Fears Back in Spotlight:

Stocks fell Friday on renewed fears that Greece will default on its debt obligations. This comes as International Monetary Fund (IMF) Managing Director Christine Lagarde warned Greece that missing a debt payment is unacceptable. Put bluntly, Greece will be in default if it does not meet its debt obligations. Greece officials have been asking for a grace period, but it appears that the IMF and the Eurozone will not grant one. Continue reading

Employers Add Fewest Workers Since 2013

In March, employers added the fewest workers since December of 2013. Non-farm payrolls rose by 126,000 in March, lower than even the weakest estimate and well below the average estimate of 245,000. The unemployment rate remained unchanged at 5.5%. The report details showed slower hiring among most sectors and a dip in the workforce participation rate. While these numbers were certainly disappointing, it is tough to put too much stock into one month of data, especially as these numbers are subject to revision (and often do get revised). A bright spot in the report was that average hourly earnings rose by 0.3% for the month and 2.1% year-over-year. Continue reading