Buy-back Blackouts Could Be Trouble For The Stock Market
Last week’s chart highlighted the fact that over the last several years corporations have been the dominant buyers in the market. In a few weeks, the corporate buyback blackout period will commence. Corporations are restricted as to when they can purchase, and this restriction is based on when each corporation’s earnings are reported. This chart gives the percent of companies in a blackout period by date. The blackout period peaks toward the end of October and declines thereafter. This will be a vulnerable time for the stock market, as the largest buyers will be sidelined until earnings are over. Stay cautious!