StockTalk

Its been a rough year for sure, even the classic 60 / 40 share / bond portfolio has been really hammered.  Many of us will be licking our wounds, myself included.
Not just here either, the vast majority of overseas markets have had a really tough year too.
So how do you see the rest of 2022 playing out ?
Are we done with this bear market or is there plenty more grief or a little bit more grief to come ?
(The NZX50 closed on 21/10/2022 at 10,782).  Where too from here for the rest of this year ?

Just a guess but I'm thinking it will be reasonably flat for the next few months, read that prophecy in my tea leaves this morning. Lots of things that could drive it lower but I also feel like buy the dip mode might be activating soon, expecting a tug of war between the two forces to play out for a while.

Anyone's guess but to me Govt stock 10 year interest rates are a real key here and are to quite some extent are acting in a manner not dissimilar to the tail wagging the dog.  Factor in geological issues and when we're going to start to see inflation coming down and central banks starting to pivot and in the short term (1-6 months), this is pretty much a crapshoot.

Oh dear ... this is a comparable challenge to predicting next Sundays (or is it Saturdays?) winning Lotto numbers :):

Quite easy ... if Putin rolls on his back, China choses economic benefits over war, the Saudi autocrat looses his murderous instincts and comes to his senses, if the US have come mid term elections still a government able to act, if the extreme and populist right in Europe (Italy, Hungary, Sweden) can be stopped and if no big economy defaults on its debt payments, than I see a Mega bull coming ...

Given however that all of the above is unlikely (though not impossible) I'd say we will keep muddling through ... with interest rates and energy prices being the determining factors.

Long term both will go down again, but where they will be end of this year? That's as sensible as trying to predict how high the waves will reach at New Brighton peer 31/12/22 at exactly midnight.

One thing I am sure of is no one really has any idea. Look at the experts that said we were heading for disaster when COVID started. After the initial shock the opposite happened with large increases in property and stocks.

A friend of ours who had a large portfolio sold all his shares when things were looking bad right at the start.  He said to me that it cost him several million, as he missed the gains.

For me I have added a few new positions and continued buying the dips in increments. Have also re balanced with a bias to quality and made sure my portfolio is diversified.  I am 95 percent fully invested.  Happy to sit back and see what happens.

Quote from: Shareguy on Oct 26, 2022, 06:51 AMOne thing I am sure of is no one really has any idea.....

For me I have added a few new positions and continued buying the dips in increments. Have also re balanced with a bias to quality and made sure my portfolio is diversified.  I am 95 percent fully invested.  Happy to sit back and see what happens.

Crikey 3 good days on Wall Street in a row....... all bets are off!

FWIW I'm with Shareguy in this....(famous last words?)

Buying the dips and using DCA to improve positions and strengthen my now well diversified portfolio.

Interesting the results so far indicate people on a weighted average basis are still pretty cautious which aligns with my sentiment.

Suppose some are a bit relieved after an up-day today on the NZX market but we're still in deep doggy doo territory for the year.

I'm cautious until such time as there is concrete evidence that inflation is starting to come off the boil.

We've never had QT (quantitative tightening) before in tandem with high inflation, high bond rates and excruciatingly bad geopolitical risk and who is going to invest in all the Govt bonds being sold back into the market (QT) globally unless the rates are high ?  High long-term bonds are the tail currently wagging the stock market dog.  I don't see how that's not going to happen for a while longer yet.

I'm with Jamie Dimon...this could easily go back and test new lows...or maybe not, time will tell but the results of the poll nonetheless are interesting and indicative at least of contributors on here of a healthy degree of caution going forward. 

https://www.cnn.com/2022/10/31/investing/stocks-winners-losers/index.html

Monster gains in the US for October which has been really surprising but the $64,000 question for the rest of 2022 is it sustainable for Nov/Dec ?

Market commentators this morning on CNBC seemed equally split between a positive outlook for the rest of 2022 and the opposing view that this is a good time to take some chips off the table preparing for a recession in 2023.

What effect on the NZX50 for Nov/Dec given we closed yesterday at approx 11,300 ?  Gosh I reckon you might as well flip a coin, this could easily go either way...

Where does the NZX 50 close at the end of 2022?

I don't really care much.

My investment decisions are based on the perceived performance of individual stocks over a longer time period of 5 years (or more) rather than at the end of 2022.

NZX is just a guide which I hope to out-perform in the long term.

So far so good and feeling 'well positioned.'

I like your approach Left field.  Look a few / several years out and invest on a "look through" the recession basis.  I recently took a large position in HLG on that basis.  I'm not super good with long term patience, (best to acknowledge your limitations eh) so I like great yield to go with most of my holdings and that helps pay for hobbies and fun times in one's semi retirement while I wait for the growth.  Without a reasonable yield I find it hard to hold long term, I get restless and want to trade whatever it is on the cycles.

I think if you're buying well managed companies with a very strong business model and strong balance sheet on sensible metrics with a good yield, you're odds-on favorite to do well in the medium to long term and as you suggest that means the next couple of months doesn't really matter. 

Fed hikes interest rates 75 points but hints it's at the end of the cycle.....

that's good.....right?

wrong!?

Commentary in the press conference was interesting.  All about managing the risk of inflation and making sure the job is done even at the risk of over tightening.  No doubt about it, Powell is determined to fix the problem but there will be pain ahead for the economy.
I am on record as saying last months monster rally in the US markets was too much and got us towards the upper end of the trading range.  I think reality now bites that there's no way to get inflation under control, (given a lot of cost pressure is caused by external forces the Fed has no control over such as oil and grain prices caused by the Ukraine war), without seriously slowing the economy.
That means earnings coming down.  16 times 220 earnings, (Wall street is currently about 230) on the S&P 500 gives about 3500 on the S&P500, so yeah, I think we're headed back down to the bottom end of the recent trading range as the market comes to terms with the likelihood that there is no "Goldilocks" solution to the current conundrum the Fed faces.  Holding rates higher for longer right through 2023 is looking incresingly likely so we could be stuck in a trading range for quite a while yet.

How to weather all this ongoing, (frustratingly durable), market funk ?
Hold value shares with strong balance sheets that pay a really good yield so you can relax and simply enjoy the yield.  Keep some cash for bargain opportunities.  Sell market darlings on unrealistic multiples that will get hurt by slower growth and higher interest rates driving multiple contraction.

And don't forget,  wise use of DCA can improve your portfolio positions if/when bargains come along.

I don't where the NZX50 will end the year, but I don't think it will be much higher than what it is now.
I have been running a daily spreadsheet for over 20 years which has had all sorts of little additions.
One thing that pops up in a bear market is an anticipated date that the bear market will end. 
The calculation is done by a start date the Dow Jones started heading down Less the lowest date it hit bottom times 1.4.
So the start date was 12 January 2022 DJ was 36,290
Lowest date so far 30 September 2022 DJ was 28,725
Difference 261 days times 1.4 = 365.4 days after 30 September 2022 which is 30 September 2023
Probably nowhere near, but a bit of fun and not as far away as other predictions I have heard.

Is this the trigger

Minneapolis  (CNN Business) - Consumer prices rose 7.7% for the year ending in October, according to data released Thursday. The report was better than expected and surprised investors, with markets surging on the news. But the Federal Reserve still has far to go in its battle to tame inflation.

And Russia withdrawing from Kherson.

Today will be a good day.

Quote from: Shareguy on Nov 11, 2022, 04:09 AMAnd Russia withdrawing from Kherson......Today will be a good day.

Bloomberg headline today; "Stocks Spike by Most in Two Years"

That's the beauty of staying largely invested in dire times...... 'cos when the news changes (as history shows it always does,) - investors benefit big time.

Bring it on.

Oh my goodness the option that literally nobody picked, 11,500-12,000 might come in !!

Quote from: Basil on Nov 11, 2022, 11:15 AMOh my goodness the option that literally nobody picked, 11,500-12,000 might come in !!

Well there is that saying about "The market always surprises..."

Quote from: Basil on Nov 11, 2022, 11:15 AMOh my goodness the option that literally nobody picked, 11,500-12,000 might come in !!

Mmmm interesting times certainly.

I didn't vote in the poll because I don't follow indexes much and favour TA/FA on individual stocks.

I guess the market is currently benefiting from some results season hype and some encouraging signs both in Ukraine and the USA.

Agree 100% FA and TA on individual stocks but the poll is just a bit of fun and mainly to gauge market sentiment.  It's not too late to vote, (closes 14 November), you might win the chocolate fish  :D   Should have had an option of `12,000+, you never know...

Quote from: Basil on Nov 11, 2022, 12:09 PMAgree 100% FA and TA on individual stocks but the poll is just a bit of fun and mainly to gauge market sentiment.  It's not too late to vote, (closes 14 November), you might win the chocolate fish  :D   Should have had an option of `12,000+, you never know...

lol - have now voted.....crikey, anything for a chocolate fish!