On a lighter ERPE Excerpts, here are some fast, fun facts. While typically sharing hopefully insightful financial market and global economic developments that I think are timely and relevant, today’s ERPE Excerpts is intended to pass on some stats and facts that you might find interesting…
That’s almost 300 hours on the road!: American drivers spend an average of more than 17,600 minutes behind the wheel each year, according to a survey from the American Automobile Association Foundation for Traffic Safety. Source: WANADA
“Going out of Business”: Major US retailers announced more than 7,300 store closures last year, up 57% from 2023, according to Coresight Research. That’s the highest annual number of stores closed since 2020. Source: CNN
Nutritious and delicious?: Americans who are obsessed with health, wellness and longevity are so hungry for rich sources of protein that cottage cheese has become one of the sexiest products in the grocery store. U.S. sales of cottage cheese have increased more than 50% over the past five years, according to market-research firm Circana. Source: The Wall Street Journal
Super Bowl snacks: The number of chicken products consumed at quick-service restaurants, including sandwiches, wings, nuggets and strips, has increased 11% since 2019 and increased 2% year over year in the 12 months ended October 2024, according to Brooks Berrodin, a food industry analyst at market research firm Circana. Source: NACS
Speaking of the Super Bowl: The Super Bowl has topped television ratings in the United States every year since the first championship game in 1967. This has made commercial time during its broadcast the most expensive of any televised event in the United States. For this year’s game, a 30-second commercial spot is reported to cost $8 million.
That’s “trillion” – with a “T”: The world’s 500 richest people gained $1.5 trillion in wealth last year, per Bloomberg. Collectively, their net worth reached $10 trillion for the first time. Source: Yahoo! Finance
More Trillions…: The global wellness industry was worth $6.32 trillion in 2023, according to a new report from the Global Wellness Institute, a leading industry group. That’s 25% larger than it was in 2019, making it bigger than the sports and pharmaceutical industries. Source: Bloomberg
Costs to upgrade: According to a Senate subcommittee report, from 2018 to 2023, five U.S. airlines made more than $12 billion on seat selection fees alone. Source: CNN
They got nothin’ on Rocky: With box office sales exceeding projections for the year, fourteen of the 15 highest-grossing movies of 2024 were sequels. Source: Islander Media Group
What Fun Fact surprised you the most?
TAKING PERSPECTIVE…
Proper Perspective: In our hectic and often hard to comprehend world, it is very easy to lose perspective. You may agree it is sometimes difficult to see the big picture. The media often doesn’t help with this, but unfortunately instead encourages us to see things in a most negative light. Here is hopefully a pause to gain positive perspective.
Famous Quote On This Day: “I hold it that a little rebellion now and then is a good thing, and as necessary in the political world as storms in the physical”
~~Thomas Jefferson, 1787
What Happened On this Day January 30, 1933- “The Lone Ranger”radio program begins on station WXYZ in Detroit, Michigan.
MARKET ANALYSIS
INDICATORS OF INTEREST:
Market’s Current Signal: Market in Confirmed Uptrend. Analysis of the stock market over 130 years of history shows we can view it in terms of three stages – market in uptrend, uptrend under pressure and market correction. Since the 1880’s, this perspective has led to investment out-performance relative to market indexes. This is due to trend analysis which determines risk reducing, return enhancing market entry and exit points. The U.S. stock market’s current signal strengthened again on January 17th to Market in Confirmed Uptrend.
The Stock Market Trend: Market in Confirmed Uptrend. Minus a Santa Rally, the U.S. stock market is off to a good start in 2025, though December’s weakness triggered a change in the market’s trend. That cautionary view was a function of mounting distribution days since mid-December. Many of those of since fallen off and market action mid-January has been more bullish. Most of the AI stocks that got hammered by the news report about China’s DeepSeek have rebounded. Here is my market alert note about DeepSeek this Monday.
Recapping Last Week
U.S. equities posted a second straight week of gains, fueled by investor optimism for artificial intelligence investment, corporate earnings, and potential pro-business policies of the new administration. The S&P500 index rose 1.7% to a record weekly closing high, erasing last month’s losses. The Nasdaq Composite also gained 1.7%, while the Russell 2000 advanced 1.4%. Energy was the lone S&P500 sector to finish lower, as crude oil slumped 3.5% on President Trump’s remarks at the World Economic Forum calling for lower oil prices. Bitcoin surged to a new record above $110k before pulling back slightly, as traders took stock of a possible U.S. strategic reserve for the cryptocurrency. U.S. Treasury yields were modestly higher in a week that lacked impactful economic data. U.S. business activity slowed in January, but price pressures increased, according to the S&P Global flash PMI indices. The services reading fell to 52.8 from 56.8 the prior month, while manufacturing PMI edged into expansion territory at 50.1. Inflationary pressures intensified to a four-
month high, with input costs and selling prices rising at increased rates across both sectors. Continuing jobless claims reached the highest level since November 2021, suggesting new jobs may be getting harder to find. Existing home sales rose for a third straight month in December, but sales for all of 2024 were the lowest since 1995 as the housing market was pummeled by high mortgage rates and home prices along with low supply. U.S. consumer sentiment slipped in January from its
initial reading while one-year inflation expectations remained steady at 3.3%.
In international markets, the Bank of Japan raised interest rates by a quarter-point to 0.5%, a move that was heavily signaled in hopes of avoiding the market turmoil from August’s rate hike. The BOJ said it would be closely watching upcoming wage negotiations for further policy adjustments. Japan’s national core CPI reached a 16-
month high of 3% in December. China left its main lending rates unchanged last week, but the government continued to try to support a struggling stock market by directing state-owned insurers and mutual fund managers to channel more investment into shares. In Europe, positive flash PMI data sent the euro soaring versus the U.S. dollar. January’s composite reading moved into expansion territory for both Germany and the Eurozone while confidence in future activity increased. Growth in British businesses flagged to begin the year and price pressures rose, highlighting the challenges facing the Bank of England. There were signs of a softening UK labor market as the unemployment rate ticked higher, but wage growth remained stubbornly strong. Finally, Canada’s inflation rate slowed in December, helped by a sales tax break, which offset a rise in retail sales
Current View
Yesterday’s major market indices were impacted by earnings reports and the Fed meeting. Further digestion of the DeepSeek news moved some AI beneficiaries. The market’s recent trend signal flashed a bullish indicator on the 17th. This shows market resiliency remains intact. Leading growth stocks showed relative strength. Earnings reports a rushing in and certain to move stocks. The focus will be on the guidance for full year 2025.
Industry Group Strength: BULLISH. As of yesterday, 139 out the 197 groups I monitor are up year-to-date. 58 groups are down for the year.
New Highs vs. New Lows: BULLISH. In yesterday’s session, there were 174 new 52-week highs and 76 new 52-week lows.
Dow Dividend Yield: BEARISH. The current yield for the Dow Jones Industrial Average is 1.67%. The 10-year Treasury now 4.52%.
Volatility Index: NEUTRAL. Volatility has been volatile. The “VIX” is now 16, the same as two weeks ago. The index is also known as the “Fear Index.” It is considered a contrarian indicator and therefore viewed as bullish as it rises indicating investors are becoming more fearful. The VIX:
Fear / Greed Index: NEUTRAL. Investors are driven by two emotions: fear and greed. Too much fear can create a condition of oversold/ undervalued stock prices. Too much greed can result in overbought/overvalued stock prices. The AAII Investor Sentiment Index is now neutral. BE FEARFUL WHEN OTHERS ARE GREEDY. At 47, the Fear & Greed Index is up from 30 two weeks ago.
CLICK VIDEO FOR MORE ON THE “FEAR & GREED INDEX”
How CNNMoney’s Fear & Greed Index works
Bull / Bear Barometer: NEUTRAL. This secondary market indicator should also be viewed with a contrarian perspective. As of yesterday, according to the latest survey of stock market newsletter writers by Investor’s Intelligence, the bulls is 47.5%. The bears have dropped to 29.5%. The bearish read was 32.2% 2 weeks ago. Consider this a contrarian indicator because the crowd is often wrong at market tops and bottoms. In other words, extreme bullishness has been seen near several market tops in the past, while extreme bearishness has been seen at market bottoms.
Put / Call Ratio: BEARISH. The ratio of put-to-call options is 0.57, about the same as 2 weeks ago. The put-call ratio tracks the mood of what options investors are doing, not just saying. They typically buy puts if they think a stock will decline and calls if they think it will rise. If they’re buying lots of puts, they see the market declining. And if they’re loading up on calls, they’re generally bullish. Historically, market bottoms occurred when the reading spikes to 1.2 or more. Market tops are often made when the reading is 0.6 or less. Note how reliable this is with respect to the February record low coinciding with the market high. Keep in mind this is also a contrarian indicator.
ECONOMIC UPDATES
Global Economic Indicators & Analysis:
POSITIVE INDICATORS
Discuss your Chevron Retirement Options
Schedule a Consultation with Us
Subscribe to Market Insight
Map/Direction
Let’s Discuss your Portfolio
Blackhawk Wealth Advisors
Blackhawk Wealth Advisors employs a collaborative, multi-generational model by using tax efficient and risk mitigation strategies to maintain your current lifestyle while meeting your long term needs and goals. BWA brings together all aspects of your financial life with the expertise of ERPE and BAM.
Blackhawk Asset Management
At BAM, we take the research we obtain from ERPE and utilize it to manage our clients’ assets. Our founder, John Gardner, CFP®, CPM®, offers high net worth investors experienced investment portfolio management based on a disciplined methodology. John is one of the nation's approximately 400 Certified Portfolio Managers and has managed billions of dollars in equity portfolios over his professional career since 1984. He has created four effective, proprietary portfolios: Thematic Growth, Strategic Income, Diversified Value, and Global Opportunity, which have helped clients prosper.
More Info
Equity Research & Portfolio Evaluation
Equity Research & Portfolio Evaluation (ERPE) utilizes its propietary approach in analyzing investments. Its proven success researching equities is based on a blend of fundamental and technical analysis. ERPE's time-tested Top 10 Tenets guide the investment process to achieve Portfolio Optimization: This is through minimizing risk without sacrificing return.
