Buybacks ending which will not hold up markets anymore

-

 Buybacks ending which will not hold up markets anymore

With interest rates rising and recessionary concerns looming, companies need to protect their dry powder. Two years ago, interest rates were Zero. In a few months, the Fed funds rates will hit 5%. But that’s not all…On January 1, a new law went into effect. The Inflation Reduction Act mandates that companies pay a 1% tax on all buybacks moving forward. In December, RBC Capital Markets warned that the “potential pillar of support” would disappear. Around the same time, Bensignor Investment Strategies sounded a similar warning… “Corporate buybacks – a major catalyst for the bull market since the Great Financial Crisis – will likely be dramatically reduced going forward because of a new 1% excise tax on them taking effect on Jan. 1, as well as corporations no longer being able to issue almost cost-free debt (like they had been able to for several years) to finance those buybacks”.

Comments

Post a Comment

Popular posts from this blog

Layoffs will increase to match 2018 levels which should be another 400,000

-
Image
 Layoffs will increase to match 2018 levels which should be another 400,000 How bad are the layoffs? Tech  has been hit hard by layoffs. Are these layoffs a leading indicator of greater economic problems, or a natural reset after unsustainable healthy growth?  We're not going to be able to answer that question definitively, but we're going to dig into jobs numbers to contextualize what's going on. To start, we updated the data behind our  article on the Great Resignation .
Read more

NYMO and NAMO Indicators

-
Image
 NYMO and NAMO Indicators Take a look at the McClellan Oscillators for the NYSE and the Nasdaq (NYMO and NAMO)… (Click here to expand image) (Click here to expand image) These are momentum-based indicators that help determine overbought and oversold conditions.  Readings of more than 60 indicate severely overbought conditions and often precede large declines in the markets. Readings of less than -60 express extremely oversold conditions and usually lead to strong bounces in stock prices. Both indicators closed in the extremely overbought territory last Friday. This is the sixth time in the past year that both the NYMO and the NAMO have been above 60 at the same time. Now, here’s how the S&P 500 performed after the four previous times… The market fell almost immediately following all five of the previous setups. The setup in mid-July led to only a brief, short-term pullback – lasting about one week. The S&P 500 then went on to rally about 10% over the next month into a significa
Read more

https://www.yourjuno.co/about

-
Image
JUNO Wealth is about far more than owning a nice house and being able to jet off on a nice holiday. Wealth equals freedom. Freedom to pursue education, to leave a toxic relationship or to start a business. That’s why we’ve built Your Juno. We know that closing the gender gap in financial literacy is not the final hill to climb in the trek towards gender equity. But knowledge is power - so it's a good place to start.
Read more