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The stock market dip? Keep buying, says Bank of America Merrill Lynch

The Stock Market Dip? Keep Buying, Says Bank Of America Merrill Lynch chapter is one about those Finance, Forex groups, posted during our scripter Erick Emerson at February 8, 2019, the section can search upon these hastag America, Bank, Buying, Dip, Lynch, Market, Merrill, stock. I'm joyful to satisfied you along with providing these anothers essay related finance and I always publishing these essay daily.

Stock market action over the last 24 hours is telling us that either investors are looking for excuses to sell, or reality has caught up with everyone in a big way.

Wall Street met a wall of selling on Thursday, though nothing like the ugly days of December, as worries about global growth and trade got together and collectively blew up confidence a little. Given it’s Friday and lots of investors want to see if this move down has legs, there may not be too many too many bravehearts out there ready to dive back in. At least that’s how things are shaping up.

As for hand-wringing over the latest developments on U.S.-China trade talks, some have had quite enough.

“It’s been a year now. Trump isn’t going to meet [Chinese President] Xi until after the deadline, so the market goes down. I don’t remember Trump meeting XI as ever being part of the plan, or being a definite? Do they both have to meet? Do they not have phones? Is it possible for a deal between the two countries to be worked out by the deadline…and then signed in April? Or Maybe March 2?” says Mott Capital Management’s Michael Kramer, in a blog post.

Bottom line, Trump will get a deal because he wants to add that to his list of achievements before 2020. “He also doesn’t want the stock market to go down, that is his Job approval rating,” says Kramer, who provides our chart of the day below that shows the S&P 500 is still in good shape.

Onto our call of the day, from Bank of America Merrill Lynch, whose weekly “Flow Show” update says investors should remain loyal, for now, to a resurgent market mantra.

“The correct strategy in 2018 was ‘sell-the-rip’; Positioning, Policy, Profits and Populism argue the correct early 2019 trading strategy is to ‘buy-the-dip,’ wrote BofA strategists, who say indicators they are watching — the Philadelphia Semiconductor Index

SOX, -2.24%

the SPDR S&P Homebuilders ETF

XHB, +0.87%

 and the South Korean Kospi index

SEU, -1.20%

 — remain bullish.

But they are worried about a “still stubbornly flat” yield curve and the fact that an ETF tracking U.S. retailers

XRT, -0.67%

 has broken below its 50-day moving average.

As for the bull case, here’s the breakdown of their four P’s: Positioning: flows show a rush back to credit, but not equity, and if cash levels drop from 4.9% to 4.6% or below in next week’s fund manager survey that would “temper” their bullish call. Policy: The global central bank tightening cycle has clearly ended. Populism: the greatest threat to earnings per share in the next three years— via taxation, regulation and government intervention. But “populism simply means investors discount higher budget deficits (U.S. government already spends $1 billion every 2 hours) and avoids government bonds…equities would benefit.” Profits: Companies will need to stop reversing earnings forecasts lower before markets can set new highs, unless investors go on a…

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