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Afternoon Note

Friday Flare

By Charles Payne, CEO & Principal Analyst
4/12/2019 1:53 PM
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The market is acting great and it’s not just because major averages are racing toward all-time highs but distortion of buying and overall resolve.

Financials are leading the way with JP Morgan (JPM) ahead of the pack.  Although the other hot sectors today are big reservoirs of value stocks.

Materials and Industrials are big sector winners as money rotates out of utilities and real estate, with healthcare continuing to get hammered.   A lot of momentum names have stalled or are pulling back as well.

Early in the session, the rally began to fade after the release of April Consumer Sentiment from the University of Michigan. The number wasn’t a disaster but declined from March and missed consensus.  A closer look, however, shows strong confidence in current conditions (at four month high) but growing worry about the future.

Current 114.2 from 113.3

Expectations 85.8 from 88.8 

United States Consumer Sentiment

The key passage from the report suggests the GOP tax cuts have lost some luster.

Spontaneous references to the tax reform program were on balance favorable in January 2018 (22% favorable minus 6% unfavorable). Since then, however, unaided references declined sharply so that by early April the net balance was zero (4% favorable minus 4% unfavorable). The data do not imply that consumers were pleased or displeased with the reforms, especially the limitations on SALT deductions. The data do suggest that consumers thought that its simulative impact on the overall economy has now run its course.

The rally has regained its footing so it will be interesting to see if it will power ahead into the close and ahead of the weekend.  The Dow finishing with a 300+ gain would be the biggest “buy” signal of the session.


Comments
CHARLES YOUR OPTIMISM IS BEING REWARDED I BOUGHT SOME DISNEY YESTERDAY ON A HUNCH ABOUT THEIR STREAMING HIT THE JACKPOT HOWEVER I STILL HAVE MY BOEING THAT HAS BEEN DESTROYED WIN SOME LOSE SOME

ERNEST REMUS on 4/12/2019 3:59:55 PM
Thanks ERNEST Win some now...win some later. Keep in mind Disney which we featured as a special report in December and newsletter in September just breaking old high that went back to Nov 2015...Boeing won't take that long. Congratulations...this has been great year and not over by long shot. CP

Charles Payne on 4/12/2019 4:02:23 PM
 

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