[Charts] The Next Massive Mania-Trend
Dear Wall Street Daily Reader,
Once a week or so I like to embrace the adage that “a picture is worth a thousand words.”
I select a handful of charts that put recent investment news into perspective for you. Then I throw in some snarky commentary.
All it takes is a quick glance and you’ll be up to speed — and more importantly, poised to profit.
Bull Market Death-Cross?
All eyes are fixated on 10-year treasury yields as they keep rising.
They’ve spiked so much — a whopping 0.2% to 1.6%, momentarily — that all the Chicken Littles in the market want us to believe that runaway inflation is right around the corner.
Meanwhile, the dividend yield on the S&P 500 Index has been falling.
And (gasp) the two lines crossed in the last week! It’s a dreaded bull market death-cross, they say.
But the survey data says? Nonsense!
Truth is, Treasuries should yield more than stocks because government bonds are nearly a risk-free asset. And historically, they do yield more than stocks the majority of the time.
What’s more, as Bespoke Investment Group notes, “These crosses [since the financial crisis] have actually been far from bearish for the S&P 500’s near-term performance.”
More specifically, in the 30 days following the cross, the S&P rallies an average of 1.5%. And it keeps rallying for an average gain of 7% over the next three months.
Translation: Focus on the data, not the fear mongering in the headlines. The dreaded treasury/dividend yield death-cross is bupkus!
The longer-term market fundamentals remain decidedly bullish (surging earnings, pent up economic demand, accommodative central bank policies around the world, and the list goes on).
The recent market sell-off is healthy. It’s a prime opportunity to add to positions you love at cheaper prices.
So don’t be a chicken — do it!
SPAC Nation Revisited
Recently, I alerted you to a booming niche in the IPO market for Special Purpose Acquisition Companies (SPACs).
The latest estimates now call for a staggering 1,000 SPACs to hit the market this year.
Insanity!
That would be more than four times the number of SPACs last year.
Take a look:
With so many opportunities, I’m fine-tuning a system to profit from this boom.
You can click here to see what I’m talking about… and what I’m recommending you do to grow your wealth this year.
Google Trends data reveals that everyone and their mother wants to know more about SPACs.
Forget meme stocks — this data makes the case for SPACs becoming the next massive mania-trend to invest in.
Are you in? I am!
Ahead of the tape,
Lou Basenese
Editor and Founder, Trend Trader Daily
