Investors look out, one of the most respected names in financial media has just warned that stocks are set to unravel quickly. The WSJ is arguing that the quick run-up in stock prices this year, and tight trading range, is akin to a coiled spring that will pop once prices finally move outside their band. Last week was the tightest trading week since 1972, with prices moving only very slightly. Historically speaking, such tight trading ranges have been followed by big bouts of volatility. The stock market is up almost 400% since its 2009 bottom.
OxWFD: We know we have been harping on about this for awhile, but yet again, this is a warning without a catalyst. We think it is useless to warn that stocks are going to fall merely because they are in a tight trading range. What will trigger the move lower?
Source: Wall Street Journal
The wealth management industry has rarely looked healthier. The sector’s top 40 firms are growing at an eye-watering clip. As a group they manage over $7 tn in accounts with $5m or more, and have collectively grown at a 19% annualized rate in 2017 by this metric. In 2016 and 2015, the growth figure in AUM was just 2%. The top 10 players in the industry control about 80% of all assets, but interestingly, their share of the growth was lower than the firms ranked 11-40 this year.
OxWFD: The rising stock market and big rally seem to have done wonders for wealth management AUM growth, but then again the industry was thriving for the several years prior as well.
The stock market is having a major panic about demand for the iPhone 8. Supplier stocks, such as Honhai and Pegatron, are seeing big stock losses as reportedly weak demand for the new model weighs heavy. Suppliers of iPhone components are very concentrated in Taiwan, so the market there has been taking the brunt of the selling. Orders for the iPhone are reported to be “substantially lower” than for the iPhone 6 or 7.
OxWFD: Of course they are lower, the iPhone X is about to come out! A much bigger worry for us would be if people were buying the iPhone 8 heavily, which would have meant the pricing strategy for the iPhone X had failed.
In a sign of escalation of the tension between the US and North Korea, the US sent war planes flying very near to the country over the weekend. The act is seemingly the first outside of simple rhetoric undertaken by the US. North Korea warned in the UN on Saturday that it would take “merciless pre-emptive action” if provoked by the US. In response, the US flew its planes closer to North Korea than at any time in the 21st century, intended as a show of force to Pyongyang.
OxWFD: The tension just keeps building and building and we wonder where it is headed. Hopefully both sides continue to stick to words only.
Source: Financial Times
Amazon made huge waves when it acquired Whole Foods, with many thinking it may have its sights set on conquering the grocery sector. Well, based on a new deal it is working on, it may have an even larger goal: food as a whole. Amazon has just sealed a deal with a tech company company called Olo which helps streamline online deliveries for restaurants. The company has huge clients like Chipotle, and Shake Shack, and partnering means Amazon will have a quicker and more seamless entry into the food delivery business.
OxWFD: Other food delivery businesses, like GrubHub, should look out. Getting these big established names on their delivery platform will give Amazon a big leg-up in this race.