Latest news with #AAII
Business Insider
20 hours ago
- Business
- Business Insider
BlackRock's $2.4 trillion money manager says the market is in the most bullish investing environment ever
Rick Rieder is feeling ultra-bullish these days. The BlackRock fixed-income chief says the market is in the best-ever investing environment. He pointed to bullish factors like strong earnings, productivity, and the $7 trillion on the sidelines. For Rick Rieder, the stock market has never looked so good. The chief investment officer of global fixed income at BlackRock says he thinks the market has emerged into the "best investing environment ever," thanks to a cluster of factors that are setting up a bullish backdrop for equities. Rieder's ultra-bullish view isn't shared by all. Concerns about the US economy and the impact of tariffs have caused the percentage of investors who said they were bearish on stocks over the next six months to rise to 43% in the last week, according to the latest AAII Investor Sentiment survey. But for Rieder, who manages $2.4 trillion of client money, the setup right now is ideal. "It doesn't mean necessarily that everything's going up, but there's a couple of things at play that are pretty extraordinary," Rieder told CNBC on Wednesday. Here's what's driving his optimism. Stock market technicals The technical backdrop for equities is highly favorable. Investors have around $7 trillion of cash sidelined in money market fund, which some have said could fuel fresh gains for stocks as rates come down in the coming months and that money is deployed into equities. Corporate stock buybacks are also at record highs. That's setting up an excellent supply-demand picture for the market, Rieder said. "Technicals in equities are crazy," Rieder said. "The demand versus supply is pretty extraordinary. " Earnings growth Corporate earnings are still holding up despite pressure from tariffs. Of the the S&P 500 companies that have reported results for the second quarter, 81% have beaten earnings estimates, above the 10-year average, according to the latest update from FactSet. If that proportion of earnings beats holds, it will mark the best earnings season for the benchmark index since 2023, BlackRock said in a recent note. Earnings strength also applies to some of the market's most popular stocks. If you exclude Tesla from the Magnificent Seven, earnings growth among the group of tech stalwarts is growing at a pace of around 54% year-over-year, Rieder said. At that rate, Rieder said Big Tech stocks' high valuations aren't greatly concerning. Fed rate cuts The Fed has room to start cutting interest rates again in September, and potentially more aggressively than markets expect, Rieder said, pointing to two catalysts in particular: Slack in the job market. The economy added way fewer jobs than anticipated in July. Job gains for the months of May and June were also heavily revised downward, indicating that the labor market was much weaker than initially thought. Good inflation numbers. The July inflation report was in-line with economists' expectations. There's some pick-up stemming from President Donald Trump's tariffs, but price growth overall remains low, Rieder says. Rieder said he believed it was "a given" that the Fed would issue its next rate cut in September. He also speculated that the central bank had room to lower interest rates a full percentage point from the current levels, which would imply the Fed funds rate target range falling to its lowest level in about three years. Productivity growth Productivity growth could also rise, Rieder said, pointing to advancements in tech, space, data, and spending on AI in particular. "All of these are geared towards higher productivity, operating at a lower cost basis. That's where we're going," Rieder said of recent tech trends. Higher productivity implies steeper economic growth overall, though labor productivity among all workers actually declined over the last year. The total output among all nonfarm workers dropped to around 1.3% year-over-year growth in the second quarter, according to the Bureau of Labor Statistics. "I'm sanguine on the economy. I think we're moving generally in the right direction," Rieder later added.
Forbes
6 days ago
- Business
- Forbes
Are Cash Levels High Enough To Move Stocks Even Higher?
There were more new highs in most averages last week as the S&P closed up 2.1% in July, while the Nasdaq Composite rose 3.7% and the Invesco QQQ Trust (QQQ) gained 2.4%. The downside reversal last Thursday, July 31st, and last Friday's selling resulted in lower weekly closes. The investor nervousness was reflected in the latest AAII survey, as the bullish dropped to 34.9% from 40.3% and the bearish % rose to 43.2% from 33%. This was not consistent with some Wall Street experts who had lowered their S&P 500 targets in April but recently turned more positive. The AAII results were not consistent with results from the July survey by the BofA of the Global Fund Managers. In this report, like every month, there is often plenty of relevant data. In their July report, they reported the largest 3-month rise in FMS risk appetite on record. The FMS sentiment rose to a five-month high but is still below the 2024 post-election levels. I do not view all their survey results as contrary indicators, but many are. I take the FMS cash levels at face value, and it is one of the most valuable data points. In the recently released report, it dropped to 3.9% which, according to BoFA, is a 'sell signal'. I have found these readings to be an important measure for the stock market, and their signals often correlate nicely with other sentiment and technical readings. The sharp slide in growth stocks during 2022 caught many investors by surprise, as some have avoided the stock market for the past two years. As the tech-heavy Invesco QQQ Trust (QQQ) was moving higher in October 2021, the FMS cash level was already low at 3.9% as QQQ made new highs in November. The difference between the bullish % and the bearish % from the American Association of Individual Investors (AAII) can help identify important turning points when used with the FMS cash levels and other technical readings. As noted earlier, reading in the AAII Bull%-AAII Bear% below -30 is considered to be a sign that sentiment is too bearish as there are 30% more bears than bulls. It reached -56 at the bear market low in March 2009 low when the FMS cash level was 4.1% as it had increased from 3.9% the prior month. In November 2021, the AAII Bull%-AAII Bear% at 25% indicated that there were 25% more bulls than bears. The QQQ decline in 2022 was well defined as the rebound in April failed at $399 and the yearly pivot. The stronger rebound in August 2022 just reached the 50% Fibonacci resistance before the downtrend resumed. By early October, the yearly S2 support was reached. The AAII Bull%-AAII Bear% difference was -40, as there were now 40% more bears than bulls, and the FMS cash levels had risen to 6.3%. In my experience, when the FMS cash level is above 6% then I start to look for signs of a market bottom, which was the case in April 2025. If FMS cash levels are below 4% then I am looking for signs from the technical studies that the stock market has topped. That was the case by early January 2022, 'How Low Will We See Tech Go?'A look at the past year will help you better understand how these data points can help improve your market timing. In July 2024, the S&P 500 came close to the weekly starc+ band as it made a high of 5669 and then declined over the next four weeks to a low of 5119.26. The FMS Cash levels had been declining since the October 2023 high of over 6% In August 2024, the FMS cash level was at 4.3% and the bull%-bear% had dropped to -1 after a July reading of +30 as the four-week decline had sharply reduced the bull% in the AAII survey. By October 2024, the cash level had fallen to 3.9% as the S&P continued to move higher. The S&P 500 made a series of new highs in late 2024 and eventually peaked in early February at 6147.43. In the February 2025 survey, the FMS cash level was low at 3.5%. The bull%-bear% had peaked in late 2024 and then spiked to a brief reading of 15% in January 2025. There were 15% more bulls than bears at the February 2025 high Just a few weeks later, it had dropped below -30 and reached the -40 level in both March and April. The FMS Cash in April had dropped to a low of 4.8% and was even lower, at 4.5% in May. By mid-July, there were more bullish than bearish investors as the advance/decline analysis turned positive in early May. As we complete the first full week of trading in August, the market action has become more split. As of August 7th, the QQQ is up 0.75% while the Dow Jones Industrial Average (DIA) is down 3.6%. I will be watching for the August survey results to see if the cash levels have gone even lower, as they often top or bottom ahead of the averages.. This week, the AAII Bull%-AAII Bear% is at -8.3 after the prior week's reading at +7.3. My analysis indicates that bullish sentiment is still rising, but given the low cash levels, this may not last for long.
CNBC
7 days ago
- Business
- CNBC
Sentiment on stocks collapses the most since the February market top
The latest gauge of investor sentiment is rife with uneasiness. Counterintuitively, some market strategists think that could be a bullish sign that forces traders to get back into the market and drive stocks higher. Bearish individual investor sentiment toward stocks over the next six months rose by more than 10 percentage points, the most since February, in the latest weekly survey by the American Association of Individual Investors. More than two-fifths of investors polled, or 43.2%, are now negative on how stocks will perform through the early part of next year, up from 33% last week. The 10.2-point rise was the most since a 20-point increase shortly after the S&P 500 reached a then-record high on Feb. 19. According to Bespoke Investment Group, the week ending in Aug. 6 was just the fourth period since the bull market began in October 2022 that bearish sentiment had a 10-point weekly increase. "The AAII numbers can be volatile at times, and this survey, whether it's due to an older cohort or some other factor tends to be more negative than others," Bespoke co-founder Paul Hickey told CNBC. "I'll be the first to say that certain sectors of the market have gotten frothy, but there's also a non-trivial contingent of people we talk to who are increasingly worried that things are about to fall apart, and that's not usually the sentiment you see around peaks." Investor sentiment is viewed by many as a contrarian indicator. The idea is that when investors are bearish, they are more likely to have already sold stocks and have more cash on hand to put to work. And when more are bullish, the reverse is true. "If the poll is bearish, that is encouraging," Sam Stovall, chief investment strategist at CFRA Research, said in an email. "The institutional investor (smart) money tends to look at retail investors as 'dumb money' and tends to make near-term price performance projections accordingly." Although market volatility has dramatically lowered since the start of the year, a series of negative news and data releases — such as tariff hikes on top trading partners, threats on pharmaceutical tariffs, the Federal Reserve's decision to maintain rates and a weak July jobs report — has weighed on sentiment and kept investors wary of high valuations at bay. At the same time, stocks have chugged along, driven by strength in corporate earnings results and consumer spending, AI enthusiasm, technical strength and more. The three major U.S. indexes are each in the green for the year and are tracking for a weekly gain.
Yahoo
05-08-2025
- Business
- Yahoo
Watch These 3 "Mag 7" Stocks Showing Positive Momentum
Richard Driehaus has secured a spot in Barron's All-Century Team thanks to a strategy based on the "buy high and sell higher" theory. This approach is undeniably effective for selecting top momentum stocks. To that end, the magnificent seven stocks like Inc. AMZN, Alphabet Inc. GOOGL and Meta Platforms, Inc. META have been selected as the momentum picks for the day using the Driehaus strategy. A Detailed Look Into the Driehaus Strategy Regarding the strategy, Driehaus once said, 'I would much rather invest in a stock that's increasing in price and take the risk that it may begin to decline than invest in a stock that's already in decline and try to guess when it will turn around.' In line with this insight, the American Association of Individual Investors ('AAII') considered the percentage 50-day moving average as one of the key criteria before creating a portfolio following Driehaus' philosophy. It is calculated by dividing the numerator (month-end price minus 50-day moving average of month-end price) by the 50-day moving average of the month-end price. Another momentum indicator — positive relative strength — has also been included in this strategy. A positive percentage 50-day moving average indicates that the stock is trading at a price higher than its 50-day moving average level, indicating an uptrend. Moreover, AAII found that Driehaus primarily focuses on strong earnings growth rates and impressive earnings projections to pick potential outperformers. Companies with a strong history of beating estimates are also given importance in this strategy, which was made to provide better returns over the long term. Screening Parameters Using Research Wizard: To make the strategy more profitable, we have considered only those stocks that have a Zacks Rank #3 (Hold) and a Momentum Score of A or B. Our research shows that stocks with a Style Score of A or B, combined with a Zacks Rank #3, offer a solid upside potential. • Zacks Rank Equal to #3 Whether the market is good or bad, stocks with a Zacks Rank #3 have a proven history of outperformance. You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here. • Last 5-year average EPS growth rates above 2% Strong EPS growth history ensures an improving business • Trailing 12-month EPS growth greater than 0 and industry median Higher EPS growth compared to the industry average indicates superior earnings performance • Last four-quarter average EPS surprise greater than 5% Solid EPS surprise history indicates better price performance • Positive percentage change in 50-day moving average and relative strength over 4 weeks Positive percentage change in the 50-day moving average and relative strength signal uptrend • Momentum Score equal to or less than B A favorable momentum score indicates that it is ideal for taking advantage of the momentum with the highest probability of success. These few parameters have narrowed the universe of more than 7,743 stocks to only 13. Here are three of the 13 stocks: Amazon Amazon engages in the retail sale of consumer products, advertising and subscription services through online and physical stores in North America and internationally. Amazon has a Momentum Score of A. The trailing four-quarter earnings surprise for AMZN is 23%, on average. Alphabet Alphabet provides a range of products and platforms across multiple regions, including the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada and Latin America. Alphabet has a Momentum Score of B. The trailing four-quarter earnings surprise for GOOGL is 16%, on average. Meta Platforms Meta Platforms focuses on creating products that allow individuals to connect and share with friends and family using mobile devices, personal computers, virtual reality, mixed reality headsets, augmented reality and wearables globally. Meta Platforms has a Momentum Score of A. The trailing four-quarter earnings surprise for META is 20.5%, on average. You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge. The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out. Click here to sign up for a free trial to the Research Wizard today. Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. Disclosure: Performance information for Zacks' portfolios and strategies are available at: Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Inc. (AMZN) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report Meta Platforms, Inc. (META) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
04-08-2025
- Business
- Globe and Mail
Watch These 3 "Mag 7" Stocks Showing Positive Momentum
Richard Driehaus has secured a spot in Barron's All-Century Team thanks to a strategy based on the "buy high and sell higher" theory. This approach is undeniably effective for selecting top momentum stocks. To that end, the magnificent seven stocks like Inc. AMZN, Alphabet Inc. GOOGL and Meta Platforms, Inc. META have been selected as the momentum picks for the day using the Driehaus strategy. A Detailed Look Into the Driehaus Strategy Regarding the strategy, Driehaus once said, 'I would much rather invest in a stock that's increasing in price and take the risk that it may begin to decline than invest in a stock that's already in decline and try to guess when it will turn around.' In line with this insight, the American Association of Individual Investors ('AAII') considered the percentage 50-day moving average as one of the key criteria before creating a portfolio following Driehaus' philosophy. It is calculated by dividing the numerator (month-end price minus 50-day moving average of month-end price) by the 50-day moving average of the month-end price. Another momentum indicator — positive relative strength — has also been included in this strategy. A positive percentage 50-day moving average indicates that the stock is trading at a price higher than its 50-day moving average level, indicating an uptrend. Moreover, AAII found that Driehaus primarily focuses on strong earnings growth rates and impressive earnings projections to pick potential outperformers. Companies with a strong history of beating estimates are also given importance in this strategy, which was made to provide better returns over the long term. Screening Parameters Using Research Wizard: To make the strategy more profitable, we have considered only those stocks that have a Zacks Rank #3 (Hold) and a Momentum Score of A or B. Our research shows that stocks with a Style Score of A or B, combined with a Zacks Rank #3, offer a solid upside potential. • Zacks Rank Equal to #3 Whether the market is good or bad, stocks with a Zacks Rank #3 have a proven history of outperformance. You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here. • Last 5-year average EPS growth rates above 2% Strong EPS growth history ensures an improving business • Trailing 12-month EPS growth greater than 0 and industry median Higher EPS growth compared to the industry average indicates superior earnings performance • Last four-quarter average EPS surprise greater than 5% Solid EPS surprise history indicates better price performance • Positive percentage change in 50-day moving average and relative strength over 4 weeks Positive percentage change in the 50-day moving average and relative strength signal uptrend • Momentum Score equal to or less than B A favorable momentum score indicates that it is ideal for taking advantage of the momentum with the highest probability of success. These few parameters have narrowed the universe of more than 7,743 stocks to only 13. Here are three of the 13 stocks: Amazon Amazon engages in the retail sale of consumer products, advertising and subscription services through online and physical stores in North America and internationally. Amazon has a Momentum Score of A. The trailing four-quarter earnings surprise for AMZN is 23%, on average. Alphabet Alphabet provides a range of products and platforms across multiple regions, including the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada and Latin America. Alphabet has a Momentum Score of B. The trailing four-quarter earnings surprise for GOOGL is 16%, on average. Meta Platforms Meta Platforms focuses on creating products that allow individuals to connect and share with friends and family using mobile devices, personal computers, virtual reality, mixed reality headsets, augmented reality and wearables globally. Meta Platforms has a Momentum Score of A. The trailing four-quarter earnings surprise for META is 20.5%, on average. You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge. The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out. Click here to sign up for a free trial to the Research Wizard today. Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. Disclosure: Performance information for Zacks' portfolios and strategies are available at: Zacks Names #1 Semiconductor Stock This under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be. With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028. See This Stock Now for Free >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alphabet Inc. (GOOGL): Free Stock Analysis Report Meta Platforms, Inc. (META): Free Stock Analysis Report This article originally published on Zacks Investment Research (
