Is there a lightning speed’ stock market sell-off in August

With the recent bull market rally, market analysts are adamant that stock can continue to drive higher than we have ever seen in the history of the stock market. Is this true, have recent earnings been good enough to take us and soar past recent highs, or is this positivity just a house of straw with nothing to show and ready to be blown over in a gust of wind?

The months of August and September are notorious for dramatic declines in the stock market, and there are a select few analysts who are sending out a dire warning investors to be mentally and financially ready when if it does eventuate!

Stocks fell last week after a combination of weak retail earnings and bank stock performance spooked some investors.

"In the dog days of summer, we can get hit with lightning speed sell-offs, if we go back over 40 years, August and September have been notorious for seeing large and dramatic sell offs in the market.” 

Rather than join the masses of scared investors in the next downturn, some analysts are seeing the other side of the coin. Meaning they are recommending clients to view it as a buying opportunity. That means having some cash available, and stock ideas on hand that could be put to work in a "cool and methodical" way.

Big Wall St, guru type investors have not been spooked by the sell-off last week. There are charitable trust took action and purchased stocks like Nvidia and Activision Blizzard on weakness. These are just some ideas going forward while market constituents watch the ebbs and flow with the market. 

Despite the fact that everyone was freaking out, the positive backdrop for stocks didn't change. We have low inflation, low interest rates, good earnings and a weak dollar. So astute investors realise that sort of market environment can be very healthy in these dire times. Sometimes you have to look past the trees to see the forest!

Low inflation means that earnings for companies could be worth more in the future. Often considered by some as to be a huge wrapped up Christmas gift, as high inflation could erode the long-term value case for equities.

Additionally, low interest rates can act as a positive catalyst to spur business in the U.S., and prompt investors to buy stocks with strong dividends. There are no guarantees but the role of this article is to try and help readers weigh up the positives and negatives and make informed decisions from that. 

Regardless of the positive implications of interest rates or inflation, some traders still have reservations. The first on the list would be that Congress is not in session currently. In this perspective, both sides of the aisle are at odds with President Trump. Thus, the market could move higher while Congress is not in session, and then be impacted negatively when it reconvenes in September. Hedge fund managers do watch the events in congress to make important decisions with their trades. So that might mean the stock market sits on shaky ground the next few months. 

Other worries on market analysts list were technology stocks, the recent bounce in transportation stocks and interest rates.

Ultimately, a good strategy going into the worst two months or the year, might be for investors to start selling the worst stocks in their portfolio that have managed to go up as a part of the broad rally and have some cash on hand for the next downturn.

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How To Profit From Trump Being President – 3 Industries You Should Invest In Now

On January 20, 2017 President elect Donald Trump will be sworn in as the 45th President of the United States of America. Once he takes office you can expect some major changes to take place in the economy almost immediately. And while some promises will without a doubt be broken once Trump takes office, based on what he said on the campaign trail here are 3 industries you should invest in now.

1. Defense

If there is one thing the Republican Party hangs it hat on its military strength. And with some of the things Trump has said, you can expect him to be very aggressive when it comes to protecting America. According to Ian Bremmer, the president of Eurasia Group, when it comes to going after terrorists from the air, Trump will more than likely take that to a whole new level.

Because unlike President Obama, Trump is not risk averse. He is therefore more likely to take action without giving it much thought. This of course would mean high tech defense and aerospace manufacturers will profit big time.

The top 4 defense stocks you should buy are Boeing, Northrop Grumman, Lockheed Martin and Raytheon.

2. Infrastructure

If you drive you know the nation’s roads are in need of serious upgrades. In a Debate back in December of 2015 Trump made it very clear he would spend billions to upgrade the nation’s airports, roads and bridges.

Trump has more experience with building that any other President in history and you can expect him to put it to good use. Add that to the fact one of his biggest campaign promises was to build a 50 foot wall along the Mexico border and you see why infrastructure can prove to be a very smart investment.

It will cost anywhere between $15 billion and $25 billion to build a wall of this nature. It would also cost an additional $750 million just to maintain it.

3 of the top infrastructure stocks you should invest in now are Jacobs Engineering, Fluor and Caterpillar.

3. Small Cap Stocks

Because of Trumps protectionist message multinationals who are directly involved in international trade will take a big hit. Smaller companies however, especially those who operate mainly in the United States, won't be as affected.

Because of this small cap stocks will more than likely outperform stocks from larger companies. A good small cap investment would be Vanguard's Russell 2000 ETF.

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Donald Trump Investments – 4 Stocks This Billionaire Business Man Loves

In July 2015 Donald Trump, who at the time was nothing more than a Republican presidential contender, made his financial disclosure forms public. The 92 page disclosure was a true treasure trove that showed how one of the best deal makers in the world invests his fortune.

According to the disclosure Trump had at least $1.4 billion in assets with $70 million being held in stocks. Based on his investments it looks like Trump loves large caps. And while Trump has his holdings in a variety of different sectors, there are a few that really stand out in the crowd as he invested a minimum of $500,000 in each.

Here is a quick look at 4 stocks Donald Trump seems to really love:

#1 – Apple (AAPL)

Being that Trump loves to brag about his many successful businesses it’s no surprise he invested so much in tech giant Apple. Apple is behind the groundbreaking iPhone which has been wowing both consumers and investors for many, many years. In 2015 Apple stock had a 1.7 percent dividend yield and made Trump between $15,000 and $50,000 during the reporting period.

#2 – Kinder Morgan (KMI)

Kinder Morgan is one of the largest energy companies in the nation. And while this particular stock didn't pay Trump a dividend in the 2015 reporting period, he did manage to earn between $100,000 and $1 million for a capital gain.

When it comes to energy and crude oil Kinder Morgan is a very strong play. Especially for those who are a bit bullish on crude oil.

#3 – JP Morgan Chase & Co. (JPM)

While JP Morgan Chase & Co. could easily be called an anti Trump stock, it is one that managed to produce a 2.5 percent yield in 2015. And though revenues did slip a bit, they were still higher than those on Wall Street expected. With a 2.5 percent dividend yield and JP Morgan Chase successfully cutting costs, it’s safe to say this stock turned out to be a winning play.

#4 – International Business Machines (IBM)

In the 2015 reporting period International Business Machines reported quarterly sales of $20.8 billion. This was a bit below the $20.95 billion Wall Street was expecting. And even though IBM isn't coming out with hot technologies such as the iPhone, they still have a very cheap price to earnings ratio which makes it a smart stock to hold on to.

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Donald Trump Stock Market – Do The Markets Really Love His Policies?

In recent weeks we have heard a lot about how “the market” loves Donald Trump's policy ideas. The question however is which “market” are we referring to? If it’s the U.S. market you are referring to then yes, stocks are indeed up since Donald Trump won the presidency.

If however you are like most people and live in a more global economy, then “the market” you participate in is actually down since Trump won the election. So despite all the noise about how great the market is doing, in reality the market doesn't like Trump's policies as much as some news stations would have you believe.

When it comes to getting a true representation of “the market” it’s all about the Global Financial Asset Portfolio (GFAP). It is this portfolio that houses all global outstanding financial assets.

Since it has no home bias it is the only aggregate portfolio that reflects the market of financial assets in an accurate manner. It is therefore the only relevant benchmark that should be used when looking at the current status of the global financial markets.

Based on the Global Financial Asset Portfolio, “the market” is actually down by 1% since Trump secured the presidency. Keep in mind this is only 1% which is not very much movement at all. It is therefore nothing to be worried about or nothing to get excited about.

If you look at this through an aggregate lens you will see that the world didn't think much about Trump winning. They woke up the day after the election, saw that Trump won and quickly got back to business as usual.

As far as the U.S. markets go, stocks and bonds are only up about 0.4% since the election. And while U.S. markets did respond more positively to Trump’s win, a 0.4% increase isn't that much of a gain. We are basically in the same position as we were the day before Trump won the election.

If there is one thing you can take from the lack of movement in the financial markets it’s the fact most markets are concerned about protectionism. This can be seen in the stocks and bonds in emerging markets that have taken a hit as well as in foreign currencies.

At this point it’s safe to say no one really knows how the global economy views a Trump presidency. We will all just have to take a wait and see approach.

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Donald Trump Stocks – The Pharmaceutical Play You Need To Make Right Now

Being that Donald Trump has tapped Tom Price as his secretary of Health and Human Services and SeemaVerma to head up the Centers for Medicare and Medicaid Services, it’s safe to say the healthcare system is poised to undergo some serious changes in the very near future.

This is because Donald Trump and his administration are fixated on the idea of lowering the cost of healthcare in the United States. And from the looks of it, they are willing to do almost anything to make sure this happen.

Right now Trump is proposing the red tape at the FDA be cut so that Abbreviated New Drug Applications (ANDAs) for generic drugs can be reviewed and approved at a much quicker rate.

Right now, due to the unbelievable number of generic drug submissions received by the FDA on a regular basis, there is a backlog of about 3,000 Abbreviated New Drug Applications (ANDAs) that are waiting to be reviewed.

If Trump has his way and the red tape is cut, you can expect a sharp increase in the number of generic drugs that make their way onto the market. To benefit from this sharp increase it would be a smart move to buy stock in Teva Pharmaceutical Industries Ltd, one of the largest generic drug companies in the world.

In mid 2016 Teva Pharmaceutical Industries Ltd acquired the generic drug unit of Allergan for billions of dollars. This one move put them in the position to shape how generic drugs will be priced for the foreseeable future.

Currently Teva Pharmaceutical Industries Ltd has about 300 Abbreviated New Drug Applications (ANDAs) on file with the FDA. That means if certain healthcare reforms should take place, they would be one of the biggest potential beneficiaries of those reforms.

But here is what will make investing in Teva right now not only a smart move, but a very profitable one as well. Of the 300 or so Abbreviated New Drug Applications (ANDAs) they currently have on file with the FDA, one third of them are first generic drugs.

First generic drugs are the first generic versions of some of the most popular branded drugs currently on the market.

First generic drugs, being that they are the first of their kind, tend to have a period of exclusivity when they first hit the market. During that short window you can make a ton of money if you are invested in the company.

What If You Knew Which Way The Stock Market Was About To Move Before It Happened – CLICK HERE!

How To Profit From Trump Presidency - 3 Stocks You Need To Invest In Now

While no one expected Donald Trump to win the presidency, he was able to pull off the impossible and secure one of the most powerful positions in the world. And whether you agree with his policies or not, the reality is he is going to be the next President of America and if you want to profit from his presidency, here are 3 stocks you need to invest in right now.

#1 – Cemex

One of Trump’s most popular messages during his campaign was the fact he was going to build a wall to make America safe again. Not only is he planning to build a wall 1,000 miles long, but he is also planning to have Mexico pay for it.

If the wall should become a reality and Mexico is forced to pay for it, you can believe they will source all materials locally.

Cemex is a San Pedro based company that generated over $14 billion in net sales in 2015. $2.8 billion of those net sales came right from Mexico which makes it a very smart investment as we head into a Trump presidency.

#2 – ExxonMobil

I think it’s safe to say Trump has what many would call a militaristic zeal. When speaking to Bill O'Reilly about defeating ISIS Trump was quoted as saying, "Take back the oil. Once you go over and take back that oil, they have nothing. You bomb the hell out of them, and then you encircle it, and then you go in. And you let [ExxonMobil] go in."

If this should happen it would mean a very big payday for ExxonMobil. And while many believe Trump's proposition to bomb the hell out of ISIS is quite ridiculous, it would still drive up oil prices and make a lot of companies a lot of money in a relatively short period of time.

#3 – HCA Holdings

Part of Trump’s plan to make America great again is to allow Veterans to go anywhere they want to get the health care they need. If this should happen the use of VA hospitals would decrease and non VA hospitals would almost instantly become more profitable.

HCA Holdings is one of the leading health services holding companies in the world. They operate and manage around 168 hospitals and 116 freestanding surgery centers in 20 U.S. states and England.

If Trump has his way with the Veterans Administration you can expect HCA Holdings stock price to go through the roof.

What If You Knew Which Way The Stock Market Was About To Move Before It Happened – CLICK HERE!

Why The Brexit Crisis Will Get Worse – 3 Things To Look Out For

On June 23, 2016, the people of Britain voted to leave the European Union. The impact of this historic referendum was immediately felt all over the world. Just 24 hours after the vote, markets all over the world plunged sharply. According to some economists, the markets plunging is a sure sign that economic turmoil is on the horizon.

Here are 3 things that can cause the Brexit crisis to get worse:

#1 – The Slow Down Of Trade Flows

A research brief put out prior to the referendum showed various ways the British economy would suffer as a result of Brexit. The brief pointed out the fact that almost 50 percent of all UK exports go to the rest of Europe. And Britain has benefited greatly from the lower tariffs and market access you only get when you are part of the European Union.

Once Britain decided to leave the EU, trade flows now have the potential to slow down considerably.

#2 – UK Incomes May Start To Fall

According to the Centre for Economic Performance at the London School of Economics, UK incomes could fall by as much as 3.1 percent in the wake of Brexit. With lower incomes you open the door for homelessness, poverty and higher crime rates.

#3 - Businesses May Stop Hiring

When there is a lot of uncertainty in the economy, the first thing businesses will do is stop hiring. They will also stop making any new investments. Instead they will start to shrink their workforce in a effort to preserve their business.

So not only will incomes be lowered, but people won't be able to find jobs. This is truly a recipe for disaster. And once one domino starts to fall, the rest will start to fall and things will only get worse.

As Paul Krugman of the New York Times put it, Brexit will make Britain poorer. While he can't put a number on how much poorer Britain will be, he does believe it will be substantial.

At this point no one really knows the long term economic impact Brexit will have on the European Union or on Britain. Larry Summers, the former director of the US National Economic Council, believes  the bigger question is what will happen if other countries decide to follow Britain's lead and exit the European Union?

For now the world will just wait and see what becomes of Britain over the next 12 months.

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How To Profit From The Brexit Crisis – 2 Opportunities For Homeowners & Investors

When Britain voted to leave the European Union, markets all over the world took an immediate hit. Chaos ensued and people all over the world weren't sure what to expect next.

However, after a few short days things started to calm down and lucrative opportunities started to come to the forefront. Here are just two of the many ways homeowners and investors can profit from the Brexit crisis.

#1 – Refinance Your Mortgage

Immediately after the vote came down, the yield on the benchmark 10-year Treasury dropped to 1.44%. That's the lowest it has been in four years. This of course is good news for homeowners all over the world. With lower borrowing costs, now is the perfect time to refinance your mortgage.

According to Zillow.com, refinancing right now has the potential to save you up to $600 a month on a $300,000 30 year mortgage that was taken out in 2010. Please note refinancing is not for everyone. You should only refinance your home if you can lower your interest rate by 0.75-percentage point, and if you plan on staying in the home for at least 5 more years. Otherwise it won't be worth it as the fees will far outweigh the benefits. 

Keep in mind there are also costs associated with a no cash refinance. For instance, your mortgage may be reset to 30 years.

#2 – Reorganize Your Portfolio

Another way you can profit from the Brexit crisis is by reorganizing your portfolio. This is especially true for long term investors. The fear created by Britain leaving the European Union caused stocks to fall more than 5% in just 48 hours.

As a result scared investors started selling off their stocks as quickly as possible. That opened the door for savvy investors to snatch up a ton of suddenly cheap stocks.

Big financial institutions such as JPMorgan Chase and Wells Fargo were impacted the most by the sell-off. Both however are well diversified banks and will have no problem bouncing back.

As billionaire investor Warren Buffet once said, “Be fearful when others are greedy and greedy when others are fearful.” Right now is the time to be greedy. The Brexit crisis has opened up a value buying opportunity most are too afraid to act on.

Right now, given the right set of circumstances, you can greatly enhance your returns by making a few minor adjustments to your portfolio.

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