Equities

(New York)

With the market’s gains in recent days, many investors may be getting more confident that a big correction is not on the cards. However, while technical signals are looking good, there is some evidence that the big rally in stocks is set to end. One of the more worrying signs is that major tech companies like Alphabet, Apple, and Facebook, are all in decline. These stocks represent a major share of total market capitalization, so losses there may wound the S&P 500 and Nasdaq as a whole. Yields are another area to keep an eye on, as they were falling recently (bearish for stocks), but have stalled.


FINSUM: There are, as ever, some bearish indicators on the margins. But as has been the case for several years, this does not mean the market will fall.

(San Francisco)

A lot of articles came out today warning that Apple’s new iPhone 8 sales may be slow. Most sources saw this as a sign of weakness for Apple. To be clear, the iPhone 8 is not the groundbreaking new iPhone you’ve been hearing about, that is the iPhone X. Rather, this is the updated version of the iPhone 7. Despite the fears, the Wall Street Journal took the opposite line, arguing that weak demand for the new device might show there is a lot of excitement for the iPhone X’s release. Apple decided to stagger the debut of the phones, with the iPhone 8 coming out earlier.


FINSUM: We do not think weak iPhone 8 demand is necessarily either bad or good for the iPhone X. For example, even if demand is weak for the 8, it does not mean there is strong demand for the X.

(New York)

It is hard to imagine Goldman Sachs as middling or even, dare we say it, an underdog. However, that is exactly the position the company is in, at least for the moment. Goldman’s rankings in the fixed income league tables leave it tied for third in an area it usually dominates. It has never been ranked lower than second in fixed income since 2007. Additionally, its shares have fallen this year while those of all other major banks have risen, leaving at a relatively weaker valuation than its rivals, such as Morgan Stanley.


FINSUM: We think that Goldman Sachs is a well-run organization and we expect their earnings will bounce back quickly which means now may be a good time to buy.

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