WHALE BUYER– The Bank of Japan has taken over as the biggest owner of the nation’s stocks, with the total value of its holdings climbing well above $400 billion – Massive exchange-traded fund purchases by the BOJ to support the market amid the pandemic this year combined with subsequent valuation gains pushed its Japanese equity portfolio to 45.1 trillion yen ($434 billion) in November.
December is set to be the busiest year-end on record for initial public offerings in the U.S., with DoorDash Inc. and Airbnb Inc. ready to start trading this week in long-awaited listings – The two startups, which are aiming to raise a combined $6.2 billion at the top-end of their price ranges, will propel the month’s IPO volume to all-time high, surpassing the $8.3 billion mark set in December of both 2001 and 2003. DoorDash upped the price range for its stock in a Friday filing, while Airbnb plans to boost the proposed price range of its initial public offering to between $56 and $60 a share. The IPO ETF is a double in 2020!
S&P Dividend Yield Versus U.S. Treasuries…Above 1 is cheap
A Favorite Bullish Indicator For Stocks Is Still Flashing Green
Take a look at the chart below that shows the ratio of the S&P 500 dividend yield to the 10-year treasury yield. The ratio skyrocketed because the 10-year bond yield has plummeted, yet the S&P 500 dividend yield has remained relatively steady between 1.8% – 2%.
If not stocks, what else?
What about other asset classes? Take a look at the chart below, which plots each asset’s annualized inflation-adjusted return over the last decade against its long-term average. The asset that performed the worst since 2010, relative to its historical average, was gold, followed closely by international stocks and U.S. bonds.
