Tags: Federal Reserve | rate hike | jobs | economy

Investors, Economists Debate Timing of Fed Rate Hike

By    |   Monday, 10 August 2015 05:19 AM

Stefan Hofer, MD and Chief Investment Strategist at BNP Paribas, says that “perfectly fine” jobs data, accompanied by a strong dollar, call for the Fed to wait “as long as humanly possible” to raise interest rates, and he thinks that means “December, basically.” (After all, after six years of QE-n, let’s not rush into this.) Michelle Girard, RBS Chief U.S. Economist, says “it would take a lot” to keep the Fed from raising rates, but she makes it sound like the Fed is still agonizing and might relapse.

Fast Money traders were in the mood to talk about weakness, and Mike Khouw singled out Apple (AAPL), then Disney (DIS), whose downside move Khouw noted hasn’t been seen to this extent in a decade. He sees “a reversal, where money’s coming out of these high-flying names,” but he observed that with the VIX at 13, the market isn’t in a panic. Dan Nathan added that other media names beside Disney were “taken to the woodshed.” Furthermore, Tesla (TSLA) was down 10% for the week after investors had fallen in love with the stock and its story to the point where they disregarded valuation. Technician Carter Braxton Worth explained that after several years of bull performance, when leaders like tech and biotech start to falter, new leaders would have to emerge to offset the faltering of the established leaders, and that hasn’t happened. Nathan described the market as “a very late-stage bull – there’s no doubt about it,” after six months of sideways action. Looking at candidates for further weakness, Melissa Lee mentioned Starbucks (SBUX). Worth displayed a chart going back to 2002 that looks parabolic and he thinks is vulnerable to mean reversion. He then looked at coffee, which he thinks is bottoming after a long downtrend, and a third chart demonstrated that Starbucks reacts inversely to moves in coffee prices, so that if coffee is basing, an up move would not be good for Starbucks.

Dominic Chu’s Trading Nation looked at evidence of market weakness and found it wanting. Ari Wald, of Oppenheimer, is using a volume indicator to base a prediction of a healthy bull market correction of about 7.5%. Boris Schlossberg, of BK Asset Management responded that he has looked back ten years and debunked the myth of weak performance in September and October, with the exception of a little crash in 2008.

© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
Robert-Feinberg
Stefan Hofer, MD and Chief Investment Strategist at BNP Paribas, says that "perfectly fine" jobs data, accompanied by a strong dollar, call for the Fed to wait "as long as humanly possible" to raise interest rates, and he thinks that means "December, basically."
Federal Reserve, rate hike, jobs, economy
397
2015-19-10
Monday, 10 August 2015 05:19 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved