At times, companies or sectors that are in the most troubled areas provide the best buying opportunities. At other times, companies or sectors in seemingly unrelated areas can provide the best opportunities to profit from troubles.
Currently, the energy sector is out of favor. Stock prices here are under pressure from concerns of weak oil demand and a stronger dollar. The BP (BP) oil spill and the moratorium on U. S. deepwater drilling have added to the sector’s woes. The Energy Select Sector SPDR ETF ((Sun, 16 May 2010 08:48:59 -0400)
Over the past two years, the financial sector has seen more than its fair share of ups and downs. After being pushed to the brink of complete collapse after the Lehman Brothers bankruptcy, financials recovered to reclaim big chunks of the ground lost and finish 2009 as one of the year’s best performers. The financial sector has been back in focus in recent weeks as the government brought fraud charges against Goldman Sachs and lawmakers in Washington have been scrambling to push through a comprehensive regulatory overhaul.
This may not be what political wonks want to hear. However, U.S. politics has not been the primary market mover as portrayed by the mainstream media over the last week.
Due to the fact that most U.S. benchmarks rocketed to a new 52-week highs (15-month highs) on Tuesday, 1/19/10, many assume that the recent declines are tied to political issues. Obama’s going after the banks. Bernanke might not be reappointed. And Geithner is in hot water over his involvement with AIG ((Tue, 19 Jan 2010 05:51:04 -0500)
When the Obama administration unveiled last week its proposed Financial Crisis Responsibility tax, it appeared that the primary targets would be large banking institutions that had accepted billions of dollars in federal bailout funds last year. But a closer look at the proposal indicates that a handful of large insurance companies, many of whom did not take government aid to stay afloat during the downturn, could also be impacted.
The timing of the proposal has made it politically popular. Many institutions that were in danger of becoming insolvent during the financial crisis have staged impressive recoveries,...
We've seen a rally off the recent market lows, but several areas of the market are lagging. Above we can see that bank ($BKX; bottom chart) and insurance ($KIX; middle chart) remain well off their highs. The financial sector is one I'm watching closely; it led the market meltdown and then...
When the U.S. financial sector experienced an unprecedented meltdown and set off a global recession, many investor wondered just how far financial stocks would slide. After struggling to find a bottom for nearly two years, many financials ETFs have found their footing since hitting market lows in March, posting solid gains for the year.
One year ago yesterday, Lehman Brothers collapsed and sent the entire financial system and its related ETFs on a downward spiral. Today, the picture looks much different. Are financial ETFs ripe for the picking?
Since the market lows on March 9, financials have rebounded handsomely, up as much as 140% since then. Most of them are perched firmly above their 200-day moving averages, as well.
I read an interesting article last night on NYTimes.com about securitizing life insurance settlements. The gist of the process is this: you have an elderly person, say, 72 years old, who needs money badly. This person, let's call her Ethel, has a life insurance policy that will pay $2mm when she dies, but it costs her $50k a year to keep current. According to actuarial tables, Ethel is expected to live to age 77. Now, the life insurance company will "settle" the policy with her - they'll give her cash right now. How much?...
Over the last 10 trading days, the ETFs with the best price breadth included financial segments (e.g., insurance, real estate, etc.) as well as commodity companies. Over the last 250 trading sessions (i.e., 1 year), however, the ratio of net advancers to net decliners was most favorable to broad-based energy and/or oil exploration. Financial ETFs over 250 days actually had more net decliners than net advancers.
What might different short- and long-term trends be telling us about the market’s strength? For one thing, if...
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