January 18, 2016

Is this a bear market ?

Many "experts" are now declaring a bear market after the S&P 500 closed at 1,890 yesterday.

But before you jump and sell every stock you own, consider this -- some of the same people were bullish only months ago when the S&P 500 stood at 2,120. Hindsight is always 20/20.

Personally, I reduced my S&P 500 fair-market-value calculation to 1,860 on Monday from a previous 1,890. That's not meant to be a precise forecast, but does give a sense of the S&P 500's "intrinsic value -- and by my calculation, the index ended yesterday's session within just 2% of FMV.

I obviously see a chance for an overshoot to the downside, as I've previously predicted the S&P 500 might ring up a low-double-digit percentage decline for 2016. But that's looking out a bit toward later in the year.

And of course, there are always stocks at any given time that are overpriced, as well as others that are underpriced.

For instance, retailers and banks are where I see intermediate-term value.

Position: Long JPM, C, FITB, BAC, M, BBY, BBBY 

via www.thestreet.com/story/13426445/3/amazon-jpmorgan-netflix-doug-kass-views.html