I do not think this has anything to do with the pseudo inflation scares that seem to be causing people to buy raw commodities. Today’s rout in food related stocks, at a time when the market is off by 200, is concerning. If the market was up, I’d say this was rotation out of safe stocks into risk. But, this isn’t that. This is distribution, investors locking in profits in some of the safest winners over the past year, heading into cash.
Let’s review.
TSN -3%
HRL -3.7%
SAFM -5%
CORE -4.3%
SPTN -5%
CALM -3.5%
DF -3%
CVGW -4%
MDLZ -3.3%
GIS -2.7%
K -2.5%
CPB -3.25%
CAG -2.7%
SJM -2.6%
THS -3.4%
FARM -7%
If you have a better explanation, I am all ears. With gold and treasuries higher, stocks down, one could only surmise that the big money that has been hiding in these consumer staples is starting to unwind that trade. Inside Exodus, I have what’s called an ‘Old Man Index’ which is, essentially, a portfolio of safe haven stocks. It is, by far, the worst performing index, amongst several that I operate, inside of the platform.
Today’s Calculation
Meeting Prob Of Hike
06/15/2016 14.0%
07/27/2016 29.5%
09/21/2016 46.4%
11/02/2016 51.0%
12/14/2016 64.4%
02/01/2017 66.7%
Yesterday’s Calculation
Meeting Prob Of Hike
06/15/2016 4.0%
07/27/2016 19.4%
09/21/2016 37.1%
11/02/2016 41.1%
12/14/2016 56.2%
02/01/2017 59.8%
Worries about a higher dollar probably have something to do with it.
I’m sure this will be needed when deflation is swallowing nations whole,
The $1 Billion Cruise Ship, the World’s Largest Just Set Sail
Fortune-5 hours ago
http://fortune.com/2016/05/17/largest-cruise-ship-harmony-seas/
Maybe it’s one of those contrarian market-top signals. Short cruise lines?
Gold stocks keep flying. Ignoring rate hike threats.
HRL has earnings tomorrow and I figured bad news leaked but after you posted that all the other food companies are down as well, I don’t know. (HRL is the only stock I’ve owned for several years that has performed well)
Thanks Nate. Ironically, Le Fly is being badgered as an old man for getting on the ark, all the while, old man stocks are getting nailed. When rotations don’t make sense, is it distribution?