U.S. stocks have barely budged since last summer. What could determine where they go next

 Stocks have been stuck, like a dog circling its tail since September

U.S. stocks have shrugged off a number of threats since the start of the year, powering through the worst U.S. bank failure since the financial crisis, while resisting the pull of rising short-term Treasury yields.

This helped all three main U.S. equity benchmarks finish the first quarter in the green on Friday. But that doesn't change the fact that the S&P 500, the main U.S. equity benchmark, has barely budged since last summer.

"The market has handled a lot of gut punches recently and it's still standing in this range," said JJ Kinahan, CEO of IG North America, owner of brokerage firm Tastytrade. "I think that's a sign that the market is very healthy."

The S&P 500 index traded at 4,110.41 on Sept. 12, according to FactSet data, just before aggressive Fed talk on rates and worrisome inflation data triggered a sharp selloff. By comparison, the index finished Friday's session at 4,109.31.

Some equity analysts expect it to take months, or perhaps even longer, for U.S. stocks to break out of this range. Where they might go next also is anyone's guess.

Investors likely won't know until some of the uncertainty that has been plaguing the market over the past year clears up.

At the top of the market's wishlist is more information about how the Fed's rate hikes are impacting the economy. This will be crucial in determining whether the central bank might need to keep raising interest rates in 2024, several strategists told MarketWatch.

Stocks are volatile, but stuck in a circle

The S&P 500 has vacillated in a roughly 600-point range since September. But at the same time, the number of outsize swings from day-to-day has become even more pronounced, making it more difficult to ascertain the health of the market, strategists said.

The S&P 500 rose, or fell, by 1% or more in 29 trading sessions in the first quarter, including Friday, when the S&P 500 closed 1.4% higher on the last session of the month and quarter, according to Dow Jones Market Data.

That's nearly double the quarterly average of just 14.9 going back to 1928, according to Dow Jones Market Data. The S&P 500 was created in 1957, and performance data taken from before then is based on a historical reconstruction of the index's performance.

Stocks also look almost placid in comparison with other assets. For example, Treasurys saw an explosion of volatility in the wake of the collapse of Silicon Valley Bank. The 2-year yield logged its largest monthly decline in 15 years in March as a result.

That's a major departure from 2022, when the S&P 500 exhibited a strong tendency to mean-revert after breaking above its 200-day moving average, the index has waffled around its 200-day moving average since late February.

"You can't find any clues about where we're going by watching the S&P 500," said John Kosar, chief market strategist at Asbury Research, in a phone interview with MarketWatch. "Ten years ago, you could look at the movement of the S&P 500 and a simple indicator like volume and get a back-of-the-envelope idea of how healthy the market is. But you can't do that anymore because of all this intraday volatility,"

The S&P 500's 7% advance in the first quarter has helped to mask weakness underneath the surface. Specifically, only 33% of S&P 500 companies' shares have managed to outperform the index since the start of the quarter, well below the long-term average, according to figures provided to MarketWatch by analysts at UBS Group UBS.

Mega stocks, Fed to the rescue?

If it weren't for a flight-to-safety rally in megacap technology names like Apple Inc. (AAPL), Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA), the S&P 500 and Nasdaq would likely be in much worse shape.

Advancing megacap tech stocks have helped the Invesco QQQ (QQQ) Trust exchange-traded fund, which tracks the Nasdaq 100, enter a fresh bull market in the past week, as the closely watched market gauge closed more than 20% above its 52-week closing low from late December, according to FactSet data. That's helped to offset weakness in cyclical sectors like financials and real estate.

Tech behemoths have also benefited from the hype around artificial intelligence platforms like OpenAI's ChatGPT.

Confusion about the Fed's quantitative tightening efforts also helped muddle the outlook for markets.

For example, the size of the Fed's balance sheet has increased in recent weeks as banks have tapped the central bank's emergency lending programs, undoing some of the central bank's efforts to shrink its balance sheet by allowing some of its Treasury and mortgage-backed bondholdings to mature without reinvesting the proceeds.

Some strategists said this is akin to sending the market mixed signals.

"It seems to be both tightening and loosening right now," said Andrew Adams, an analyst with Saut Strategy, in a recent note to clients.

What it takes for a break out

U.S. stocks have remained rangebound for long stretches before.

Beginning in late 2014, the S&P 500 traded in a tight range for roughly two years. Between Jan. 1, 2015 and Nov. 9, 2016, the day after former President Donald Trump defeated Hillary Clinton to become president of the U.S., the S&P 500 the S&P 500 gained less than 100 points, according to FactSet data.

At the time, equity analysts blamed signs of softening economic activity in China and weakness in the U.S. energy industry caused by a collapse in prices for the market's lackluster performance.

But once it became clear that Trump would win the White House, stocks embarked on a steady ascent as investors bet that the Republican economic agenda, which included corporate tax cuts and deregulation, would likely bolster corporate profits.

It wasn't until the fourth quarter of 2018 that stocks turned volatile once again as the S&P 500 wiped out its gains from earlier in the year, before ultimately finishing 2018 with a 6.2% drop for the year, according to FactSet.

As investors brace for a flood of first-quarter corporate earnings in the coming weeks, Kinahan said he expects stocks could remain rangebound for at least a few more months.

"There's going to be a very cautious outlook still, which should keep us in this range," he said.

https://www.morningstar.com/news/marketwatch/20230401305/us-stocks-have-barely-budged-since-last-summer-heres-what-could-ultimately-determine-where-they-go-next

Belgium Remains The Cocaine Capital Of Europe

 Rosalinda González Valencia, the wife of the drug kingpin in charge of the Jalisco New Generation Cartel, Nemesio Oseguera Cervantes, was arrested by the Mexican military near Guadalajara this Tuesday.

According to the country's ministry of defense cited by Reuters, this is seen as "a significant blow to the financial structure of organized crime in the state of Jalisco".

The infamous cartel is seen as second only to the Sinaloa organization in terms of influence and volume of drugs trafficked, dealing mostly in cocaine and amphetamines.

Its trade of the former is not limited to continental operations but is also carried out in Europe via allied gangs in South America.

As Statista's Florian Zandt details in the chart below, the trafficking of the illegal stimulant is primarily a problem of Central Europe.

In Belgium alone, authorities confiscated about 65 tons of cocaine in 2019 according to data by the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA), followed by the Netherlands with 43 tons. This, of course, doesn't mean that the drug is primarily consumed in these countries, rather than the nations mentioned serve as its biggest trading centers.

Still, the Netherlands and Belgium appear in the top 8 of the countries with the highest prevalence of problem drug use in 2019, placing second and eighth, respectively, encompassing injecting drug use or regular use of opioids, cocaine or amphetamines.

While the EMCDDA categorizes cocaine as the second-most prevalent illicit drug concerning recent and lifetime usage in its latest European Drug Report, it's still only consumed by a fraction of the people surveyed by participating countries: 4.8 percent of survey participants said they have tried the drug at least once, 1.2 percent claimed they recently consumed cocaine.

https://www.zerohedge.com/personal-finance/belgium-remains-cocaine-capital-europe

The (Cold) Drugs Don’t Work

 I’ve been blogging semi-regularly for almost 15 years and whenever I feel like I’m “blogged out” with nothing more to say, I inevitably find a topic that I’ve missed or forgotten to blog. When I read this post and then this paper about the dubious justification for the sale of a common cough and cold ingredient, I was frankly embarrassed that I hadn’t already written about it – years ago. Because the ineffectiveness of some cough and cold products is something everyone should be aware of.

We all suffer from coughs and colds. Surprisingly, while there are dozens of brands and formulations of cough and cold remedies on pharmacy shelves, they all use combinations of the same core handful of ingredients. And the evidence supporting some of these products is very, very weak. In the case of phenylephrine, included to treat “congestion”, it’s widely considered ineffective. Yet the FDA and regulators around the world continue to allow this ingredient to be included in cold products, as if it has medicinal benefits. Considering the evidence, this seems unwarranted.

What is phenylephrine?

In 1976, the FDA concluded that three medicines were safe and effective for the treatment of nasal congestion caused by colds, allergies, and sinusitis: phenylpropanolamine, pseudoephedrine, and phenylephrine. Almost 25 years later, phenylpropanolamine was withdrawn from the market after use was associated with strokes. Pseudoephedrine is an effective decongestant that is chemically very similar to methamphetamine, a addictive and controlled drug that subject to abuse. Pseudoephedrine does not share the same stimulant properties as methamphetamine, though it can cause jitteriness, mild tremors, and insomnia. However, because pseudoephedrine can be used to manufacture methamphetamine, the over-the-counter sale of cough and cold products that contain this ingredient are not permitted. Sales were moved “behind the counter” in the US, with the requirement for the customer to produce photo identification and the requirement for the pharmacy to maintain a log of all sales, tracked by customer name and address.

When pseudoephedrine was moved behind the counter, manufacturers of cough and cold products either had to accept a much smaller market for their (effective) product, or…pivot.

It may not be effective. But you cannot make methamphetamine from it.

Some companies reformulated their products to contain phenylephrine instead, the last remaining non-prescription ingredient that the FDA had approved for congestion. Phenylephrine is from a category of drugs called alpha-1 agonists, that stimulate alpha-1 receptors that are present throughout the body, including the nasal passages. It is used as a nasal spray but more commonly as a oral product take to treat nasal congestion. There was a problem with FDA’s approval, however. There was little convincing evidence phenylephrine, when taken orally, was effective.

The evidence against phenylephrine

Phenylephrine is a poorly-absorbed drug (i.e., it has low bioavailability). Most of the drug is broken down during the absorption process and after passing through the liver. Only an estimated 38% of a dose actually reaches the bloodstream (compared with 90% for pseudoephedrine). In clinical trials, phenylephrine has been compared to other decongestants in a randomized controlled trial of 20 patients (way back in 1971) and found to be no more effective than placebo in reducing airway resistance. Another trial compared single doses of four different decongestants against placebo in 88 patients with congestion. It also found that phenylephrine was no more effective than placebo. In a review of the data that the FDA had considered, that review noted that for the 10mg dose, 4 studies showed efficacy and seven showed no difference from placebo. The authors concluded that a systematic review did not support the FDA’s decision. Other trials conducted since that time (like this one in 2009) are supportive of the conclusion that the 10mg dose is ineffective.

The fact that we are relying on trials conducted in the 1970’s pretty much tells us what we need to know about phenylephrine. Given how poorly it is absorbed, there is the question of whether simply giving bigger doses will work – and it turns out it may. However, the 10mg dose is what’s available in US cough and cold products – and the best evidence shows that this drug is effectively a placebo at that dose. I will point out that the manufacturers of the consumer products that contain this ingredient continue to write their own papers suggesting that there is evidence of efficacy.

The FDA is petitioned…and finally acting

In 2015, pharmacy professors Randy Hatton and Leslie Hendeles of the University of Florida College of Pharmacy filed a citizen’s petition with the FDA, asking it to remove phenylephrine from the monograph of over-the-counter cold remedies, noting the absence of a decongestant effect at the approved dose of 10mg. They noted that since the FDA’s Nonprescription Drugs Advisory Committee had called for more research in 2007, four studies had been conducted, and none of those studies demonstrated that phenylephrine was more effective than a placebo. This petition is supported by the American Academy of Allergy, Asthma and Immunology:

The low bioavailability of pharmacologically active oral PE explains the lack of nasal therapeutic efficacy and cardiovascular effects. It is extensively metabolized in the gut mucosa causing insufficient systemic PE levels to produce vasoconstriction of nasal and other blood vessels. Available data do not support whether a dose greater than 40mg of oral PE would be effective or safe. Furthermore, the American Academy of Allergy, Asthma & immunology and the American College of Allergy, Asthma & Immunology in their role as patient advocates have concluded that keeping oral phenylephrine over‐the‐counter does a disservice to patients who might be prone to taking higher doses than recommended due to lack of effect and/or delay their visit to their primary care clinician or a specialist who could help resolve their symptoms.

Ineffective drugs don’t deserve approval

Professors Hatton and Hendeles reiterated their call for the FDA to take action in 2022, and finally the FDA may act this April:

The committee will discuss the adequacy of efficacy data available for oral phenylephrine as a nasal decongestant and whether oral nasal decongestants phenylephrine hydrochloride and phenylephrine bitartrate should be reclassified as not ‘Generally Recognized as Safe and Effective’ (GRASE) due to lack of efficacy.

Why the approval has persisted so long is puzzling from an evidence perspective, but perhaps it was sensible to the FDA. Phenylephrine is safe at the 10mg dose, and withdrawing the drug might raise more questions about why this drug was permitted in cough and cold products, for decades, without clear evidence of effectiveness.  Until that time, remember that the only available non-prescription oral decongestant that has been shown to actually be effective is pseudoephedrine. Ask your pharmacist is pseudoephedrine is right for you.

• Scott Gavura

  Scott Gavura, BScPhm, MBA, RPh is committed to improving the way medications are used, and examining the profession of pharmacy through the lens of science-based medicine. He has a professional interest is improving the cost-effective use of drugs at the population level. Scott holds a Bachelor of Science in Pharmacy degree, and a Master of Business Administration degree from the University of Toronto, and has completed a Accredited Canadian Hospital Pharmacy Residency Program. His professional background includes pharmacy work in both community and hospital settings. He is a registered pharmacist in Ontario, Canada. Scott has no conflicts of interest to disclose. Disclaimer: All views expressed by Scott are his personal views alone, and do not represent the opinions of any current or former employers, or any organizations that he may be affiliated with. All information is provided for discussion purposes only, and should not be used as a replacement for consultation with a licensed and accredited health professional.

• https://sciencebasedmedicine.org/the-cold-drugs-dont-work/

Biden Laughs at Violence and Transgender Vengeance

 As they say, we find out who we really are during a time of crisis. And what we’re finding out about the Democrats and the American left only continues to get more heinous. At the very least we would not be making jokes and laughing when having to deal with the murder of children and their caretakers. Unless you’re President Joe Biden, because that’s exactly what he did in the aftermath of mass murder. A mass murder committed by Audrey Hale, a transgender-identified extremist at a Christian school in Nashville, killing three nine-year olds and three adults during the rampage. When Biden attended a gathering at the White House in the aftermath of the slaughter, people were expecting a “Comforter-in-Chief” to address the crisis, Biden instead went on a riff about his favorite ice cream.

What kind of a person does this? Even sociopaths manage to successfully pretend to be normal, even charming people when engaging with other human beings. Biden doesn’t seem to even make an effort at appearing engaged or empathetic when confronted with the regularly recurring catastrophes he and his gang are creating on his watch.

Biden’s disgraceful behavior continued when asked by a reporter on the White House lawn if he agreed with Senator Josh Hawley’s assessment that this attack on Christians was a hate crime. Biden smirked, laughed, and said, “Well then I doubt that [implying he would doubt whatever Hawley thought]. No, I’m joking. I have no idea.”

Hawley spoke for all of us when he noted on Fox News that Biden’s response was “beneath the dignity of the presidency.” However, in all fairness, everything Joe Biden does is beneath the dignity of the presidency.

Biden’s callous dismissiveness is just one symptom of a Democrat Party that has dissolved into a disturbed gang relishing our descent into a violent hellscape. Just hours after the murders, Arizona Governor Katie Hobbs’ press secretary tweeted, “Us when we see transphobes,” with an image of a woman pointing two handguns at someone out of frame.

Again, we have to ask, who does something like this? Who are these people? In the aftermath of children being murdered this is what the press secretary for a Democrat governor immediately goes to?

Hobbs’ office condemned the tweet, and the press secretary “resigned” but this is an attitude that doesn’t just suddenly appear like a leprechaun in one’s mind, it has to be so familiar that you feel comfortable not only stating it publicly but publishing it for the world to see.

And no wonder, Americans must demand a clear and detailed discussion from authorities and the media about motive and what exactly influenced Hale to commit such a heinous act. What we all have seen is increasingly violent rhetoric served up by marginal extremists as they politicize and weaponized transgenderism. 

Leftist organizing on the transgender issue now revolves around the idea of “vengeance,” for what we do not know, and encouragement to counteract the ubiquitous “transphobes” with aggression and violence. Efforts by communities and parents to protect children from age inappropriate sexual information and indoctrination have been twisted by these extremists as attempts to “genocide” transgender people. That is madness, and a typical Marxist organizing template, which we’ve seen explode in the last decade using rhetoric to stir up fear, hostility, victimhood, and even violence translating into political organizing strategies and millions in donations. 

No one is helped by this obscenity, especially transgender people. Right now, faceless and nameless fringe extremists are falsely defining for the country that transgender people are violent and unhinged. One would expect some legitimate liberal organizations would come together to condemn the call for violence and the shocking rhetoric. But that has yet to happen.

The shocking open embracement of violence and even murder is emerging as a hallmark of the leftist extremists to whom the Democrats continue to appease and pander. In a recent Facebook post, a Leftist professor at Wayne State University in Detroit, Michigan posted that “speakers invited by conservative students should be killed rather than shouted down,” as reported by the Post Millennial. What does endorsing murder get you at Wayne State? At this writing the professor has been suspended. With pay.

It is now undeniable that some thing is just not right in the country. The efforts that are destroying our economy, national security, safety, and even our social cohesion are not organic or normal. It is also not what the super majority of Americans want. Being aware that these dynamics are not the result of unstoppable and natural chaos but of Democrat political planning and strategy, helps us to understand that we can push back and stop this trajectory toward the cliff. Its all meant to make you afraid and unsure. Instead, it’s time to be confident and determined as we defend our nation and a future for all people that only America can deliver.

https://amac.us/biden-laughs-at-violence-and-transgender-vengeance/

As Effort To ‘Get Trump’ Ramps Up, Are Leaks From Bragg’s Grand Jury a Crime?

 It is likely that a serious felony has been committed right under District Attorney Alvin Bragg’s nose and he is not investigating it. Under New York law, it is a felony to leak confidential grand jury information, such as whether the jurors voted to indict. The protection of secrecy is as applicable to President Trump as it is to anyone else. 

We know that the information was disclosed while the indictment itself remains sealed and before any official announcement was made or charges brought. It is unlikely that the leak came from the Trump team, which seemed genuinely surprised.

The most likely, though uncertain, scenario is that a person in Mr. Bragg’s office or a grand juror unlawfully leaked the sealed information. That would be a class E felony, subject to imprisonment.

It is possible of course that an investigation is underway, but it seems more likely that Mr. Bragg is too busy making up a crime against the man he promised in his campaign to get than investigating a real crime that took place on his watch.

In my new book, “Get Trump,” I predicted that partisan prosecutors would try to get Trump regardless of the lack of evidence or law. That prediction has come true. Since the indictment itself has not been leaked — at least not yet — we don’t know its specifics. We do know, based on leaks, that it involves multiple counts, almost certainly involving the payment of hush money to a porn actress.

Under Mr. Bragg’s likely theory, Mr. Trump should have disclosed in his public corporate records that he paid the hush money to avoid his adulterous affair from becoming public. But no one in history has ever publicly disclosed the reason he paid money for a non-disclosure agreement.

Why would Mr. Trump pay the money in the first place if he had to publicly disclose the embarrassing reason? Furthermore, no one in history has ever been indicted for listing “legal expenses” for setting a potentially embarrassing payment of hush money.

Thus, even the misdemeanor allegation involving false entries is unprecedented and represents selective prosecution. It is also almost certainly barred by the two-year statute of limitations. In order to elevate this bookkeeping case into a felony, Mr. Bragg must also prove beyond a reasonable doubt that the reason Trump made the false entry — if he himself did it — was solely as a campaign contribution to help him win his election.

If Mr. Trump was motivated in part by his desire to protect his wife, children, and business interests from harmful disclosures, that would not constitute the crime of making an undisclosed campaign contribution. So this too is a stretch.

It is a fundamental tenet of American law that criminal law should not be stretched to fit targeted defendants. Criminal statutes must be clear and unambiguous. If there is any doubt, the age-old concept of “lenity” requires that these doubts be resolved in favor of the defendant.

Thomas Jefferson once quipped that for a criminal statute to be valid, it must be so clear that a reasonable person could understand it if he read it “while running.” A nice image!

I intend to read the text of the indictment, while sitting, with 60 years of experience behind me. I doubt I will find that it meets the constitutional criteria for “fair warning,” although I maintain an open mind until I have studied it carefully.

The important point is that when a district attorney ran for office as a Democrat pledging to get Mr. Trump, who is a candidate for president against the incumbent Democrat, that district attorney must have an airtight case.

A weak, questionable, unprecedented, and novel stitching together of two inapplicable statutes, will not, and should not, satisfy the American public that this is not a partisan targeting of a political opponent.  

ALAN DERSHOWITZ 

Mr. Dershowitz is professor emeritus at Harvard Law School. He has written 52 books, more than 1,000 articles, and has successfully litigated hundreds of cases, half of them pro bono.

https://12ft.io/proxy?q=https%3A%2F%2Fwww.nysun.com%2Farticle%2Fas-effort-to-get-trump-ramps-up-are-leaks-from-braggs-grand-jury-a-crime