All Posts
Will Apple be able to dodge Trump’s China tariffs again with promise of $500 billion U.S. investment?
In the first Trump Administration Apple (AAPL) avoided tariffs on its smartphones and on its Apple Watch made in China. This time around Apple may avoid the administration’s tariffs again, but the cost is a promise to spend $500 billion and hire 20,000 people in the United States over the next four years, and open a factory in Texas to make the machines that power the company’s push into artificial intelligence.
Is the healthcare sector now uninvestable?
I have to add Robert F Kennedy Jr’s confirmation to the growing evidence that this Congress will act to rubber-stamp anything coming out of the White House. And now I’m trying to decide exactly how much chaos the new Secretary of Health and Human Services will unleash on healthcare stocks. My preliminary answer is A LOT. and that the effects of Kennedy’s tenure as head of the Department–added to the capricious decision-making of President Donald Trump and “break-things” czar Elon Musk–are just about impossible to predict. Which leaves investors with a nearly impossible challenge of assessing how much risk there is in any stock or ETF position in the sector. When you are unable to quantify risk, selling–at least some selling–is the best strategic choice for an investor. And that’s why in this post I’m going to give you my run down on what I would sell in the sector now and what I would hold onto until we see exactly how chaotic the chaos will be.
There’s more money in crypto, so the hacks are getting bigger
Crypto exchange Bybit has said it has lost almost $1.5 billion worth of tokens. A hacker took control of one of Bybit’s offline Ethereum wallets, Chief Executive Officer Ben Zhou announced in a social media post Friday, and an estimated $1.46 billion in assets flowed out to, well, somewhere else.
Saturday Night Quarterback (Part 2) says, For the week ahead expect…
The Federal Reserve’s preferred inflation metric–due Friday–is expected to cool to the slowest pace since June. But while I think markets will cheer, it’s too soon to look for any change from the Federal Reserve on interest rate cuts. That will have to wait until April at least the the central bank will get a better idea of exactly what tariffs President Donald Trump will increase and by how much.
Saturday Night Quarterback (Part 1) says, For the week ahead expect…
I expect the earnings report of the week will be Nvidia’s (NVDA) report after the close on Wednesday, February 26. For the fiscal quarter ending January 2025, the consensus EPS forecast is $0.79. The reported EPS for the same quarter last year was $0.49. Analysts expect NVIDIA’s earnings to grow 43.68% next year from $2.77 to $3.98 per share.
Consumer expectations for future inflation rise again and confidence falls
U.S. consumers’ expectations for long-term inflation rose to the highest rate in three decades, in February’s consumer sentiment survey from the University of Michigan. Consumers expect prices will climb at an annual rate of 3.5% over the next five to 10 years. The rate is the highest since 1995,
Walmart cuts its forecast for 2025 after strong end to 2024
Walmart (WMT) forecast lower than expected profit for 2025. The company said it’s anticipating adjusted earnings of $2.50 to $2.60 per share, below the average projection of $2.74 a share by Wall Street analysts. As of noon New York time today Walmart shares were down 6.8% as the lower guidance outweighed strong results for the just concluded quarter. Both top and bottom lines came in higher than Wall Street expected in the retailer’s quarter and fiscal 2025. Quarterly revenue increased 5.3% year over year to $183 billion, while adjusted earnings per share were up 10% to 66 cents a share.
Wall Street sees gold going higher on rising buying from global central banks
Today Goldman Sachs Group raised its year-end target for gold to $3,100 an ounce. Central banks are buying gold at a faster than expected pace and flows into gold ETFs are accelerating.
More warnings from the Treasury market
The two-year treasury breakeven rate–shorthand for what traders expect inflation to average over the following 24 months-now exceeds the 3% rise in January’s Consumer price Index (CPI). When the breakeven rate is below CPI, traders are in effect betting inflation will slow in the next two years. When breakeven rate is above the CPI, traders are betting inflation will accelerate.
Are they real or more vapor-tariffs?
Semiconductor chips and drugs are set to face higher duties, Trump told reporters at a news conference on Tuesday.“It’ll be 25% and higher, and it’ll go very substantially higher over the course of a year.” Asked if he had decided the rate of a threatened tariff on cars from overseas, Trump said he would “probably” announce that on 2 April, “but it’ll be in the neighborhood of 25%”. But are these “announcement’s real?
Saturday Night Quarterback says, For the week ahead expect…
i expect a significant check on last week’s stock market optimism after a wretched retail sales report forJanuary. The slump was so deep–the biggest drop in nearly two years–that it bolstered hopes that the economy was weak enough–yep, another bad news is good news moment–that the Federal Reserve would still deliver an interest rate cut in September. The drop, however, could have been a reaction to California wildfires and winter storms deep into the South.
In other words, the big decline could have had nothing to do with a slowdown in the economy or in consumer buying. This week brings–after Monday’s Presidents’ Day market holiday–earnings reports and forward guidance–from some of the big names in retail. The important news to watch won’t be earnings for the just concluded December 2024 quarter, but forecasts for the March quarter and beyond. The big retail gorilla set to report is Walmart (WMT) before the open on Thursday, February 20.
Please watch my new YouTube video Hot Money moves: China buys gold
Today’s Hot Money Moves NOW is China Buys More Gold. Gold seems like a good asset to own right now but it’s also trading at record highs. So while gold is safe, especially if inflation goes up, how much higher do you expect gold to go? One thing to look at it is who is emerging as a buyer. Central banks have been buying gold to hedge risks and diversify, which has contributed to the record highs. Recently, the Chinese government announced that 10 big Chinese insurance companies will now be allowed to put up to 1% of their portfolios into gold. This hasn’t been allowed in the past and will provide about $27 billion for new gold buying. This is also just another sign that countries and businesses are looking to hedge risk by buying gold and it’s one of the safer places to be in an uncertain market.
More bad news on inflation
U.S. wholesale prices rose in January by more than forecast on higher food and energy costs. The producer price index for final demand climbed 0.4% from a month earlier. The Bureau of Labor Statistics revised December’s calculations upward to show a 0.5% increase in December.
Looking for another hedge? Silver is cheap, relative to gold; time to buy SLV
In the current market environment, with uncertainty running rampant and risk climbing, I want to find hedges against a downturn in U.S. stocks. Gold remains an attractive option even though it is trading near its nominal all-time high near $2900 an ounce. I think systemic risk–the odds that something fundamental will go wrong somewhere with the United States, China, and the European Union (through its exposure to Italy) are all worry hot spot–is on the rise. In the U.S. market alone, I see higher risk of a nasty mix higher inflation, slower growth, higher interest rates, and bigger government deficits.
Please watch my new YouTube video: Quick Pick Intuitive Surgical
Today’s Quick Pick is Intuitive Surgical (ISRG). While 2024 was a good year for the market, it wasn’t so great for the healthcare. The sector was down about .04%. Moderna was down 60%, CVS Health was down 50% and Walgreens was down 55%–but there were a few big winners. Intuitive Surgical, maker of the Da Vinci Robotic Surgical System, was the best performing healthcare stock in 2024. The stock went up 54.7% in 2024 and it’s gone up another 11.7% so far in 2025. At the moment, Morningstar says the stock is trading at 67% premium, with a high PE of around 80, so I’d suggest waiting to buy on a dip. I like this company because it’s growing revenue steadily, around 10% a year. I believe there is a good chance at getting a substantial market dip in 2025, and if that happens, take a look at this great long-term, steady performer in the healthcare sector. The stock has been a member of my long-term 50 Stocks Portfolio since January 28, 2019. the shares are up 257% since then as of the close on February 10.
Jim’s Stock Alerts
Download Jim’s eBook for Free
