Alerts

Opening Statement from the February 2018 Dividend Gems 

Opening Statement from the February 2018 Dividend Gems 

Originally published on February 19, 2018 

Overview

Investors continue to anticipate rising interest rates. This sentiment has led to further weakness in interest-rate sensitive securities such as Utilities (primarily) Real Estate (somewhat) and Telecoms (to a variable degree). Of course the broad variety of fixed income investments (bonds and bond funds, preferred stock and private equity) has also been adversely impacted. 

For several months we have been highlighting the bull trend in oil pricing. The recent collapse in oil pricing occurred as an impulse reaction to the unforeseen selloff in global stock markets. Notably, the collapse in oil pricing was also heightened by the earnings miss from XOM and the huge miss by CVX on February 2. We previously issued cautionary statements regarding these and other major E&P firms financing a good part of their cash dividends with debt (TOT being the lone exception from our list of recommended securities).

Despite having faced a severe and unexpected stock market correction, consumer sentiment remains quite strong, as do trends in consumer spending. This has helped boost Consumer Discretionary stocks. In contrast, Consumer Staples have remained quite weak as of late most likely due to...

To continue reading please login and subscribe

Only clients who subscribe and members have access to the article

Print article

Restrictions Against Reproduction: No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the copyright owner and the Publisher.

These articles and commentaries cannot be reposted or used in any publications for which there is any revenue generated directly or indirectly. These articles cannot be used to enhance the viewer appeal of any website, including any ad revenue on the website, other than those sites for which specific written permission has been granted. Any such violations are unlawful and violators will be prosecuted in accordance with these laws.

Article 19 of the United Nations' Universal Declaration of Human Rights: Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.


0:00
0:00