U.S. Stocks Fall as Investors Pull Money, Weigh Stimulus – Bloomberg 08-09-13

Salient to Investors:

Chris Bouffard at the Mutual Fund Store said the market is in a normal digestion process as people get comfortable with how quickly and how far we have come.

Investors pulled almost $1.20 billion from US equity ETFs versus inflows of $32 billion in July, the most since September 2008.

40 S&P 500 stocks closed at new 52 week or longer highs yesterday versus 193 on May 15, and less than 79 percent traded above their 50-day moving averages, versus 93 percent on May 17. 72 percent of S&P 500 companies so far reporting have beaten earnings estimates, 56 percent have beaten sales estimates. The S&P 500 is at 15.3 times estimated earnings, close to the 3-year high last week, and versus the 5-yr average of 13.9 times.

Charles Evans at FRB Chicago, Sandra Pianalto at FRB Cleveland and Richard Fisher at FRB Dallas said the Fed may be closer to tapering as the labor market recovers.

Ivo Weinoehrl at Deutsche Asset & Wealth Mgmt said the market is at least fairly valued after a huge multiple expansion in the S&P over the past 2 years, so has little upside from a purely fundamental point of view.

Shares outstanding of the iPath S&P 500 VIX Short-Term Futures ETN, a security designed to rise when stock fluctuations increase, have tripled in 2013.

Nicole Peng at Canalys said Apple’s share of China’s smartphone market fell to 5% of the total in Q2 from 9% a year earlier. Consumers opted for lower-priced handsets from domestic suppliers.

Moody’s raised the coal industry’s outlook to stable from negative.

Read the full article at  http://www.bloomberg.com/news/2013-08-09/u-s-stock-index-futures-decline-monster-beverage-drops.html

Click here to receive free and immediate email alerts of the latest forecasts.