Sunshine Appears As Equities Post Strong Gains

'Optimism is a happiness magnet. If you stay positive, good things and good people will be drawn to you.' Mary Lou Retton

The world can be a downright difficult place, so much so one can be forgiven if they get down once in a while. Going a step further, there are plenty of people in the world who always are, to put it kindly, a bit difficult. Generally I try and minimize contact with these individuals as much as possible, but there are some days when you are booked solid with dour Dans. As it relates to the investment world, it seems the general consensus among participants is to adopt a generally pessimistic attitude about what the rest of 2016 has in store for markets. After the first month and a half, you could understand why, as it was the worst period for stocks in quite a long time, down 10% in most major markets.

If you look at the last twenty years for investors in domestic markets, they have experienced the internet bubble and crash, the accounting frauds at Enron and WorldCom, Bernie Madoff, the housing boom and bust, Lehman, American International Group Inc (N:AIG), Washington Mutual, and the unprecedented government intervention to save markets from what may have been a situation more dangerous than the Great Depression. It is understandable why placing hard earned dollars into the stock market is now viewed as, at the very least, an activity to be skeptical about. The apprehension and negative market psychology remains the overriding obstacle for equity investors, probably now more than ever.

Still, this week the market showed signs of getting off the floor as a good retail sales number last Friday, a rebound in oil as Russia, Iran and Venezuela negotiated production caps, and some bargain hunting all helped the cause. The last six months have been a trying period but it has provided an opportunity to purchase top notch companies at far better prices. If you are long term investor, you are probably grinning ear to ear. It seems Mary Lou Retton, quite the accomplished gymnast, knew a thing or too about investing as well.

There were a ton of individual companies which reported earnings this week. In the retail sector, the head honcho remains Wal Mart, which saw flat revenue and same store sales figures on Wednesday. They still earned nearly $5 billion for the quarter. Nordson Corporation (O:NDSN), a high quality department store group, also missed estimates with sales store sales falling over 3%. In the tech universe, NVIDIA Corporation (O:NVDA) posted a good number, earning .35 cents versus. .32 expected. Dining concerns Restaurant Brands, BJs Restaurants Inc (O:BJRI), and The Cheesecake Factory (O:CAKE) beat estimates as Burger King, Tim Horton's, pizza, and a good piece of cake remain time tested money makers. Next week, plenty more report including Target Corporation (N:TGT), Fitbit Inc (N:FIT), Home Depot (N:HD), and Macy`s Inc (N:M). Stay tuned.

Thanks for reading the blog this week.

Y H & C Investments, Yale Bock, and the family of Yale Bock own positions in securities mentioned in the blog post. Investing in stocks can lead to the complete loss of your capital. As always, on any company mentioned here, past performance is not a guarantee of future returns. Investing involves risk of losses on invested capital. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charter holder.