Post by Admin/YBB on Aug 27, 2022 4:04:44 GMT -6
Pg 28, TRADER. Markets heard POWELL’s inflation fighting message and fell promptly. Growth stocks fell more. The next rate hike isn’t in doubt, but speculation continues on when the Fed will pause/stop.
CA will ban sales of new GASOLINE-CARS by 2035 (phased reductions: to 65% by 2026, to 32% by 2030, to 0% in 2035). Automakers (GM, F) are not complaining as they have big EV plans with Tesla/TSLA leading now. New Inflation Reduction Act (unfortunately called IRA 2022 by some) has incentives for EVs and EV batteries.
Juniper Networks/JNPR had lousy earnings and poor guidance (but revenues held up). It is attractive on its AI-based cloud management strategy.
www.barrons.com/magazine?mod=BOL_TOPNAV
The CME FedWatch tool is based on current fed fund futures quotes around the FOMC meetings and the assumption of gradual fed fund rate changes (+/- 0.25%). In the list below, more than 50% probability is used to indicate rate hike; “+” is shown after the FOMC date to indicate that rate hike can be at that or a later FOMC.
10th, 11th & 12th rate hikes, FOMC 9/21/22+ (75 bps hike possible)
13th & 14th rate hikes, FOMC 11/2/22+ (50 bps hike possible)
Rest, FOMC 12/14/22+ (remains 3.50-3.75%)
www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html
FOR THE WEEK (index changes only), DJIA -4.22%, SP500 -4.04%, Nasdaq Comp -4.44%, R2000 -2.94%. DJ Transports -2.65%; DJ Utilities -2.78%. (Rotating spot semi SOXX -5.19%) US$ index (spot) +0.62%, oil/WTI futures +2.52%, gold futures -0.67%.
YTD (index changes only), DJIA -11.16%, SP500 -14.87%, Nasdaq Comp -22.39%. (Rotating spot semi SOXX -28.86%)
Pg 40: NYSE cumulative (5-day) A/D line fell for the 3rd week; ratio of losers:winners 3:1 (Friday was another 90.5%+ down day).
Pg 31, EUROPE. UK pub owner J.D. Wetherspoon “Spoons” (JDWPY; fwd P/E 13.8) has attractive post-pandemic prospects. It has 870+ pubs (larger ones have capacity of 1,550) and 60+ hotels. Founder/Chairman MARTIN owns 25%. It hedges its energy and electricity costs; its employee retention rate is high.
Pg 31, EMERGING MARKETS. NATURAL GAS prices are soaring on Russian supply cuts citing pipeline equipment maintenance issues. Russia is playing a dangerous game but also doesn’t want to foreclose the option for future sales (so, its approach seems to be a tease, not a complete shutdown). European STORAGE for Winter is on schedule using LNG and extra supplies from Norway. High prices are causing some demand destruction. European countries are scrambling to cap costs for consumers and ration industrial users. Several global projects will come on line in the next few years (from XOM, SHEL, TOTZF, COP, Venture Global LNG, etc). There is new urgency for renewables.
Pg 32, OPTIONS. Be ready for any market decline and VIX surges. Monitor financial XLF and tax preparer HRB. (This piece was turned in on Thursday early-AM. Then came Powell’s speech at Jackson Hole and huge market drop on Friday but no update was posted)
(SP500 VIX 25.56, Nasdaq 100 VXN 31.72, options SKEW 124.57, bond MOVE 122.95 (Yahoo Finance data)
finance.yahoo.com/quotes/%5EVIX,%5EVXN,%5ESKEW,%5EMOVE,%5EXAU/view/v1
Pg 33, COMMODITIES. GOLD has disappointed but may belong in portfolio. It may have a wide range of 1,700-2,000. Strong dollar and higher rates are headwinds.
Pg 45: A bad week in EUROPE (Norway +0.87%, Sweden -4.54%) and a flat week in ASIA (China +2.73%, Philippines -1.76%) (More easing by China PBOC).
TREASURY* 3-mo yield 2.89%, 1-yr 3.36%, 2-yr 3.37%, 5-yr 3.20%, 10-yr 3.04%, 30-yr 3.21%. REAL yields 5-yr 0.47%, 10-yr 0.47%, 30-yr 0.85%.
DOLLAR rose, ^DXY 108.84, +0.60% (pg 50). GOLD was $1,751, UNCH (Handy & Harman spot, Thursday) (pg 52); the gold-miners fell. (^XAU was at 103.84, -0.22% for the week)
Top FDIC insured savings deposit rates** (This feature has been discontinued)
US SAVINGS I-Bonds^, current rate 9.62% (annualized). Rates change on May 1 & Nov 1.
*Treasury Yield-Curve home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics?data=yield
**For local rates www.depositaccounts.com/banks/rates-map/
^Treasury Direct (I-Bonds + T-Bills/Notes/Bonds, FRNs, TIPS) www.treasurydirect.gov/tdhome.htm
(BONUS from Part 2 include Cover Story, Up and Down Wall Street, Streetwise and these won’t be repeated in Part 2)
Pg 16: COVER STORY, “(ESG) Beyond Drought: The Coming WATER Shortage Is a Threat from Main Street to Wall Street”. Water shortages in CA and elsewhere have changed consumer behaviors, HOME lawns and plantings. Investors are paying more attention to water impacts/risks/metrics on portfolios and BUSINESSES (agriculture, apparel/fashion, energy, mining, semi chips, data centers, etc). The SEC will require climate risk disclosures by 2022 yearend. Only 3% of world’s water is FRESH, and 2.5% is locked up in glaciers, polar ice caps, atmosphere, soil, so only 0.5% of the water is fresh and readily available. Many companies are RECYCLING water for reuse or alternate uses. Number and durations of DROUGHTS are rising globally. Problems in the US are acute in Colorado River areas (with Lake Mead and Lake Powell below 30% capacity). Global water DEMAND will exceed supply by 40-56% by 2030. Many companies have to write off assets stranded/idled by water scarcity.
Pg 19: Water-related stocks include utilities AWK, WTRG, YORW; testing/instrumentation DHR; treatment/testing AQUA, XYL; equipment (pumps, valves, fire hydrants) MWA.
Pg 7, UP & DOWN WALL STREET.
POWELL talked tough on inflation (for only 10 minutes) and the markets listened and fell. So appropriate from the bear country (Jackson Hole, WY) where there are plenty of bears signs and warnings posted. Tech earning reports and guidance have been poor (most recent from DELL, CRM). Brace for volatility and pain ahead.
The US STREAMING viewership has now passed cable viewership. Many homes have multiple streaming subscriptions – often lured by some big one-time event but the subscriptions linger on. Broadcast and cable viewership among the 18-49 year olds are down sharply, by 39% and 18%, respectively. Content providers are scrambling. Only the SPORTS programming is strong and that too is gradually shifting to streaming. Apple/AAPL is aggressively moving into streaming (baseball, soccer, football, etc). It can afford to pay up for exclusive rights and can take temporary losses to build market share. Look for related news and fanfare at Apple’s new product launch on September 7.
(More later….)
Accessible from Morningstar (M*), PB-Big Bang, Facebook (“at”yogibearbull), Twitter (“at”YBB_Finance).
CA will ban sales of new GASOLINE-CARS by 2035 (phased reductions: to 65% by 2026, to 32% by 2030, to 0% in 2035). Automakers (GM, F) are not complaining as they have big EV plans with Tesla/TSLA leading now. New Inflation Reduction Act (unfortunately called IRA 2022 by some) has incentives for EVs and EV batteries.
Juniper Networks/JNPR had lousy earnings and poor guidance (but revenues held up). It is attractive on its AI-based cloud management strategy.
www.barrons.com/magazine?mod=BOL_TOPNAV
The CME FedWatch tool is based on current fed fund futures quotes around the FOMC meetings and the assumption of gradual fed fund rate changes (+/- 0.25%). In the list below, more than 50% probability is used to indicate rate hike; “+” is shown after the FOMC date to indicate that rate hike can be at that or a later FOMC.
10th, 11th & 12th rate hikes, FOMC 9/21/22+ (75 bps hike possible)
13th & 14th rate hikes, FOMC 11/2/22+ (50 bps hike possible)
Rest, FOMC 12/14/22+ (remains 3.50-3.75%)
www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html
FOR THE WEEK (index changes only), DJIA -4.22%, SP500 -4.04%, Nasdaq Comp -4.44%, R2000 -2.94%. DJ Transports -2.65%; DJ Utilities -2.78%. (Rotating spot semi SOXX -5.19%) US$ index (spot) +0.62%, oil/WTI futures +2.52%, gold futures -0.67%.
YTD (index changes only), DJIA -11.16%, SP500 -14.87%, Nasdaq Comp -22.39%. (Rotating spot semi SOXX -28.86%)
Pg 40: NYSE cumulative (5-day) A/D line fell for the 3rd week; ratio of losers:winners 3:1 (Friday was another 90.5%+ down day).
Pg 31, EUROPE. UK pub owner J.D. Wetherspoon “Spoons” (JDWPY; fwd P/E 13.8) has attractive post-pandemic prospects. It has 870+ pubs (larger ones have capacity of 1,550) and 60+ hotels. Founder/Chairman MARTIN owns 25%. It hedges its energy and electricity costs; its employee retention rate is high.
Pg 31, EMERGING MARKETS. NATURAL GAS prices are soaring on Russian supply cuts citing pipeline equipment maintenance issues. Russia is playing a dangerous game but also doesn’t want to foreclose the option for future sales (so, its approach seems to be a tease, not a complete shutdown). European STORAGE for Winter is on schedule using LNG and extra supplies from Norway. High prices are causing some demand destruction. European countries are scrambling to cap costs for consumers and ration industrial users. Several global projects will come on line in the next few years (from XOM, SHEL, TOTZF, COP, Venture Global LNG, etc). There is new urgency for renewables.
Pg 32, OPTIONS. Be ready for any market decline and VIX surges. Monitor financial XLF and tax preparer HRB. (This piece was turned in on Thursday early-AM. Then came Powell’s speech at Jackson Hole and huge market drop on Friday but no update was posted)
(SP500 VIX 25.56, Nasdaq 100 VXN 31.72, options SKEW 124.57, bond MOVE 122.95 (Yahoo Finance data)
finance.yahoo.com/quotes/%5EVIX,%5EVXN,%5ESKEW,%5EMOVE,%5EXAU/view/v1
Pg 33, COMMODITIES. GOLD has disappointed but may belong in portfolio. It may have a wide range of 1,700-2,000. Strong dollar and higher rates are headwinds.
Pg 45: A bad week in EUROPE (Norway +0.87%, Sweden -4.54%) and a flat week in ASIA (China +2.73%, Philippines -1.76%) (More easing by China PBOC).
TREASURY* 3-mo yield 2.89%, 1-yr 3.36%, 2-yr 3.37%, 5-yr 3.20%, 10-yr 3.04%, 30-yr 3.21%. REAL yields 5-yr 0.47%, 10-yr 0.47%, 30-yr 0.85%.
DOLLAR rose, ^DXY 108.84, +0.60% (pg 50). GOLD was $1,751, UNCH (Handy & Harman spot, Thursday) (pg 52); the gold-miners fell. (^XAU was at 103.84, -0.22% for the week)
Top FDIC insured savings deposit rates** (This feature has been discontinued)
US SAVINGS I-Bonds^, current rate 9.62% (annualized). Rates change on May 1 & Nov 1.
*Treasury Yield-Curve home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics?data=yield
**For local rates www.depositaccounts.com/banks/rates-map/
^Treasury Direct (I-Bonds + T-Bills/Notes/Bonds, FRNs, TIPS) www.treasurydirect.gov/tdhome.htm
(BONUS from Part 2 include Cover Story, Up and Down Wall Street, Streetwise and these won’t be repeated in Part 2)
Pg 16: COVER STORY, “(ESG) Beyond Drought: The Coming WATER Shortage Is a Threat from Main Street to Wall Street”. Water shortages in CA and elsewhere have changed consumer behaviors, HOME lawns and plantings. Investors are paying more attention to water impacts/risks/metrics on portfolios and BUSINESSES (agriculture, apparel/fashion, energy, mining, semi chips, data centers, etc). The SEC will require climate risk disclosures by 2022 yearend. Only 3% of world’s water is FRESH, and 2.5% is locked up in glaciers, polar ice caps, atmosphere, soil, so only 0.5% of the water is fresh and readily available. Many companies are RECYCLING water for reuse or alternate uses. Number and durations of DROUGHTS are rising globally. Problems in the US are acute in Colorado River areas (with Lake Mead and Lake Powell below 30% capacity). Global water DEMAND will exceed supply by 40-56% by 2030. Many companies have to write off assets stranded/idled by water scarcity.
Pg 19: Water-related stocks include utilities AWK, WTRG, YORW; testing/instrumentation DHR; treatment/testing AQUA, XYL; equipment (pumps, valves, fire hydrants) MWA.
Pg 7, UP & DOWN WALL STREET.
POWELL talked tough on inflation (for only 10 minutes) and the markets listened and fell. So appropriate from the bear country (Jackson Hole, WY) where there are plenty of bears signs and warnings posted. Tech earning reports and guidance have been poor (most recent from DELL, CRM). Brace for volatility and pain ahead.
The US STREAMING viewership has now passed cable viewership. Many homes have multiple streaming subscriptions – often lured by some big one-time event but the subscriptions linger on. Broadcast and cable viewership among the 18-49 year olds are down sharply, by 39% and 18%, respectively. Content providers are scrambling. Only the SPORTS programming is strong and that too is gradually shifting to streaming. Apple/AAPL is aggressively moving into streaming (baseball, soccer, football, etc). It can afford to pay up for exclusive rights and can take temporary losses to build market share. Look for related news and fanfare at Apple’s new product launch on September 7.
(More later….)
Accessible from Morningstar (M*), PB-Big Bang, Facebook (“at”yogibearbull), Twitter (“at”YBB_Finance).