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China stocks rallying on government stimulus plans–I’m buying iShares China FXI
Just because we’ve seen this page from the play book before and just because I’m skeptical about the long-term effects of this policy doesn’t mean I don’t want to own the China rally now. On Monday March 24, I’m adding the iShares China Large-Cap ETF (FXI) to my Perfect Five ETF Portfolio and to my Jubak Picks and Volatility portfolios. (In the Perfect Five ETF portfolio I’m replacing my India ETF with this China ETF.)
Saturday Night Quarterback (on a Sunday) says, For the week ahead expect…
This week I expect the March lull before the April storm.
Huge volume today but not much movement
Just five minutes before Wall Street’s close, the Standard & Poor’s 500 erased a slide that earlier in the session exceeded 1%. The index closed up 0.08% on the day. The NASDAQ Composite added 0.52%. The CBOE S&P 500 Volatility Index (VIX) dropped 2.63% to 19.28. These relatively minor directional moves came despite huge volume.
Trump criticizes the Fed’s decision to hold interest rates steady
That didn’t take long. Wednesday afternoon the Federal Reserve decided to keep its benchmark interest rate steady–no rate cut. Wednesday night President Donald Trump renewed his call for the Federal Reserve to lower interest rates as he criticized the central bank’s decision. “The Fed would be MUCH better off CUTTING RATES as U.S.Tariffs start to transition (ease!) their way into the economy,” Trump wrote on Truth Social. “Do the right thing.” Trump added: “April 2nd is Liberation Day in America!!!” President Trump’s criticism of the Fed’s decision certainly isn’t a surprise.
Good news from the Fed today–central bank still sees two interest rate cuts in 2025
The Federal Reserve’s Open Market Committee surprised no one with today’s vote to keep the benchmark federal funds rate in a range of 4.25%-4.5%. The mild surprise came in the revisions to the Dot Plot projections. The Fed continued to pencil in two interest rate cuts for 2025. Some investors had feared that the Fed would show it has moved to projecting just one cut in 2025.
More tariffs, lots more tariffs, still on schedule forApril 2
The Washington Post is reporting today that White House aides are preparing new tariffs on most imports to be announced on April 2, laying the groundwork for an escalation in global tariffs that President Donald Trump has called “Liberation Day.”
Getting ahead of selling in this market is like playing Whac-a-mole–2 more sells
I’m selling Danaher (DHR) and RTX (RTX) out of my Jubak Picks and Dividend portfolios, respectively, in an attempt to get ahead of some of the likely fallout from policy moves by the Trump Administration. And in order to sit out as much of current market volatility as is possible.
Please watch my new YouTube video: Hot Money Moves Now Vix Call Options
Today’s Hot Money Moves NOW: Buy VIX Volatility Call Options. Toward the end of January, I bought VIX Call Options, hoping to make money as volatility increased in the market. I bought a VIX call with a strike of 20, and a VIX call with a strike of 26–both with May 21, 2025 expirations. Both of these buys were up about 40% before Friday’s snap-back rally. And looking at probable “events” I think volatility is going to increase in the second half of March. But this week we may see some optimism bring the VIX down and you may be able to buy more options on that future volatility at a temporarily depressed price. I would look to buy these options this week and hold for the next three weeks or so, through more tariff uncertainty in April and sell before the May 21 expiration. For more detail om my VIX options buys see the Volatility Portfolio on my subscription JubakAM.com site.
Luminar soars 27% today on YouTube video rave
Luminar Technologies (LAZR) surged on Monday after former NASA scientist Mark Rober test-drove a car equipped with the company’s lidar technology in a YouTube video and said it outperformed Tesla Inc.’s Autopilot feature.
Monday adding more VIX options on volatility after snap-back rally
Friday’s snap-back rally took a big bite out of the CBOE S&P 500 Volatility Index (VIX). The VIX dropped 11.72%, or 2.89, to 21.77. But the plunge in Call options on the VIX was even bigger with the VIX Call option with a strike price of 20 and an expiration of May 2025 falling 23.34% and the VIX Call option with a strike price of 26 and an expiration of May 2025 26.000 falling 31.34%. (I’m citing the action on these two options because they are the Calls that I own in my Volatility Portfolio.)
This is exactly the opportunity I flagged last week to add more volatility bets without paying too much after the run upon options prices that came to a screeching halt on Friday.
Saturday Night Quarterback says, For the week ahead expect…
I expect less drama than markets now fear from Wednesday’s meeting of the Federal Reserve’s interest-rate-setting Open Market Committee.
More bad news on consumer confidence and inflation expectations
A new survey released on Friday from the University of Michigan showed consumer sentiment falling 11% in the March survey as consumers in all age and income groups and of all political affiliations have turned more negative about the direction of the economy. Consumer...
Please watch my new YouTube video: Quick Pick Apple
Today’s Quick Pick is Apple (AAPL). This is a short term buy or, if you own it, a “get ready to sell.” Apple’s Worldwide Developers Conference happens in early May, and the stock usually gets a bounce from new product and technology announcements. This year we’re likely to hear more on AI. Apple’s stock hasn’t performed all that well lately, and I don’t want to hold the stock after the expected pop from the conference and new product releases in the fall. I worry about the long term choices the company is making. Apple has decided not to offer a low-price, affordable introductory iPhone as a gateway to their suite of products. They’ve effectively ceded the lower end of the market to other players–especially in China. They’ve also just announced that the AI add-ons to Siri they promised have been delayed and it’s unclear when they’ll be available. Apple is lagging in AI as other companies race ahead. We can expect disappointing sales in December–particularly out of China. I don’t want to hold on to the stock at the end of the year and I’m looking to sell on a bounce after the conference and new product launches in September.
That didn’t take long–snap-back rally arrives
A day after major indexes moved into a correction, stocks bounced back like, well, like a basketball after a Lebron James dunk, like a sling shock at Halloween, like, well, like stocks after hitting over-sold technical levels. The gains in stocks were, how you say, broad-based. The Standard & Poor’s 500 closed up 2.1%. The NADAQ Composite added 2.6% and the NASDAQ 100 rose 2.5%. The Dow Jones Industrial Average gained 1.7%. The MSCI World Index rose 1.8%. Bloomberg Magnificent 7 Total Return Index climbed 2.8%. The Russell 2000 small cap index was up 2.5%.
A 200% tariff on champagne? Here’s my solution to the impending crisis
President Donald Trump has threatened to impose a 200% tariff on wine, champagne and other alcoholic beverages from France and elsewhere in the European Union, if Brussels follows through with a tariff on American whiskey exports, a measure aimed at retaliating against Trump’s steel and aluminum tariffs that went into effect on Wednesday. What to do? This is serious. Life without champagne! Sacre bleu! We need a solution.
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