Folks, you know by now that we're in a time of fear in the markets... And during the Federal Reserve's meeting last week, Chair Jerome Powell made it clear that the central bank is worried about "stagflation."
Make Sure You're Prepared for the Next Big Crash
By Marc Chaikin, founder, Chaikin Analytics
Folks, you know by now that we're in a time of fear in the markets...
And during the Federal Reserve's meeting last week, Chair Jerome Powell made it clear that the central bank is worried about "stagflation."
Put simply, it looks like economic growth is slowing. Yet inflation is creeping back up toward 3%.
That makes today's market environment particularly dangerous. Specifically, inflation limits the Fed's ability to cut interest rates when the market weakens.
Still, Powell took a measured approach during the Fed's meeting last week. The Fed left rates unchanged. And the smart money expects a rate cut by the end of the year.
The simple fact is that America is undergoing an economic and political realignment. And no one knows exactly how that will play out.
At the same time, investor sentiment has reached extreme levels.
Regular readers will recall that Chaikin Analytics Editorial Director Vic Lederman explained that this past Thursday. As he noted...
Retail investors aren't just feeling bad about the market. They think it's terrible.
That's clear when we look at the American Association of Individual Investors' ("AAII") Investor Sentiment Survey. Based on this measure, as of last week, slightly more than 59% of retail investors believed the market would fall over the next six months.
Respondents have felt mostly negative since the end of last month. In fact, for the first time in history, "bullish" sentiment came in at less than 20% for three straight weeks.
And now, the most recent AAII data shows "bearish" sentiment at 58% – right around the same level.
Again, that's an extreme. And we're seeing the market begin to firm up.
The recent Fed meeting bolstered that. And the broad market S&P 500 Index managed to stay just above a key support level of 5,500.
So, there's a lot of people thinking that this downturn will be the "big one." But signs are pointing to something more concerning in the not-so-distant future...
Volatility is spiking... fear is rising... hedge funds are on a selling spree... and tech is crumbling. But is this the death of the bull market? Marc Chaikin has called almost every market twist and turn of the past few years, including the 2020 and 2022 crashes. On March 27, he wants to explain what's happening – and the ONE move you must make to prepare. Learn more here.
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Average Investors Suffer More When the Market Crashes
You see, the market is changing on a fundamental level.
And whether you're able to succeed or fail in the coming months will come down to how you're able to prepare for whatever comes next.
If this recent bout of volatility and correction has taught us anything, it's that investors are woefully unprepared for market downturns... even short-lived ones.
As such, I believe the great market crash could be much worse for investors than anyone is prepared for right now.
At this stage, it's impossible to know just how far stocks will fall when the moment arrives.
But what we do know is that whatever that total loss turns out to be... average investors are almost guaranteed to lose more.
This is an unfortunate, universal truth of investing in America. It has been that way for at least the past 30 years... and likely as long as I've been on Wall Street.
It doesn't matter what causes the crash. It doesn't matter how long it lasts... or when stocks begin to recover.
Regular folks off Wall Street always suffer bigger losses in their own portfolios than the S&P itself when the market crashes.
If you've invested for more than a year or two, you've likely experienced this for yourself...
For example, the 2022 bear market. Many folks would consider it a decline, rather than a crash.
That's because the S&P 500 "only" fell a maximum of 24%... and quickly began to recover in the third quarter, ending the year down "only" 18%.
In the history books, it will go down as a mild bear market.
But for the everyday investor actually feeling it in their portfolio, it was anything but mild...
When the 2022 bear market was at its worst, the average investor was down not 24%... but 44%. That's a huge difference.
And even as conditions began to improve near the end of the year, the average investor still ended the year down an estimated 21%... while the S&P 500 finished down 18%.
That's not a "mild market decline" in my books.
That's one-fifth of your retirement. That's the kind of loss that requires you to have some serious conversations with your spouse and family.
So, where does that leave us? Well, it's time to start preparing for the shift that's unfolding.
That's why I'm going on camera this coming Thursday, March 27, to discuss it all...
This broadcast is free to attend. And just for showing up, I'll even give out two free recommendations to help protect your portfolio against severe downturns.
All you need to do is register in advance. You can do so right here.
I look forward to seeing you there.
Good investing,
Marc Chaikin
Market View
Major Indexes and Notable Sectors
# Hld: Bullish Neutral Bearish
Dow 30
-0.12%
1
24
5
S&P 500
-0.27%
43
313
142
Nasdaq
+0.33%
9
69
22
Small Caps
-0.62%
197
1195
509
Bonds
-0.59%
— According to the Chaikin Power Bar, Small Cap stocks and Large Cap stocks remain Bearish. Major indexes are all bearish.
* * * *
Sector Tracker
Sector movement over the last 5 days
Energy
+3.07%
Financial
+1.94%
Health Care
+1.15%
Communication
+1.06%
Industrials
+0.85%
Consumer Discretionary
+0.38%
Real Estate
+0.14%
Information Technology
+0.01%
Utilities
-0.15%
Materials
-0.22%
Consumer Staples
-0.23%
* * * *
Industry Focus
Regional Banking Services
2
129
8
Over the past 6 months, the Regional Banking subsector (KRE) has outperformed the S&P 500 by +1.72%. However, its Power Bar ratio, which measures future potential, is Very Weak, with more Bearish than Bullish stocks. It is currently ranked #12 of 21 subsectors and has moved down 1 slot over the past week.
Indicative Stocks
TFIN
Triumph Financial, I
CHCO
City Holding Company
CLBK
Columbia Financial,
* * * *
Top Movers
Gainers
SMCI
+7.8%
TSLA
+5.27%
PLTR
+4.09%
DLTR
+3.34%
BA
+3.06%
Losers
MU
-8.04%
TPL
-7.17%
FDX
-6.45%
LMT
-5.79%
NUE
-5.78%
* * * *
Earnings Report
Reporting Today
Rating
Before Open
After Close
Earnings Surprises
CCL Carnival Corporation & plc
Q1
$0.13
Beat by $0.11
* * * *
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