SYNOPSIS
Finally, it’s over! Or is it? A Clinton victory would have signalled business as usual. After all, the Obama legacy would have lived on, whether you liked it or not. But a Trump win is a different story. We now face the prospect of a loose cannon in the White House with no political experience, in charge of a country with the world’s largest military and the world’s biggest debt. All the same US stocks rose nicely last week, and we’re not complaining about that.
PTP… Our ProfiTrend Portfolio APAR (annualized price appreciation rate) rose from 36% to 249% last week. No complaints there! The S&P/TSX Composite Index APAR declined to -20% from -11% previously; but the S&P 500 APAR swung from -24% to +16% over the past election week! So, how did we pull off the outstanding gain in the PTP? Well, you’ll have to read the full edition of TrendWatch Weekly to find out.
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PTA Perspective… US Election Week: Post Mortem!
Let’s not forget that before the US election, up to the previous Friday, the S&P 500 has been down for 9 days in a row… the first time that’s happened in 36 years (1980). The “fear gauge”, CBOE’s VIX, had been up 9 days in a row. The combination of the two stats had never occurred before in all of trading history. And, by just about every gauge you could find, the stock markets had been grossly oversold. So, do we give the Trump win credit for the rally last week? We don’t think so, but still, a Clinton win was supposedly “baked in” to stock prices on Monday and Tuesday, so a continuing rally on Wednesday was a shocker! By all logical arguments the DJI should have dropped around 1000 points at the open Wednesday morning, based on overnight futures trading results, after it became official that Trump had won. Something very strange happened in the four hours between Trump’s acceptance speech and the market open at 9:30am.