Morning Briefing
August 9, 2022 | AMAT, AMD, Daily JAM, Morning Briefing, Top 50 Stocks |
First, it was Nvidia (NVDA) cutting its guidance for revenue and earnings due on August 24. Today, August 9, it was Micron Technology (MU) warning that its revenue for the fourth-quarter revenue may come in at or below the bottom end of a forecast range provided in the company’s earnings call on June 30. Micron is scheduled to report on September 27. All this comes as the market is on edge anyway ahead of tomorrow’s report on CPI inflation. As of the close on Tuesday, August 9, shares of Micro Technology were down 3.74%. Shares of Nvidia were down another 3.97% after closing down 6.30% yesterday.
August 8, 2022 | Daily JAM, Friday Trick or Trend, Morning Briefing, UUP, Volatility |
In the last week, as odds have climbed of a 75-basis-point interest rate increase from the Federal Reserve at its September 22 meeting, the U.S. dollar has reversed its slide during the last two weeks of July.
Stands to reason. Higher U.S. interest rates make dollar-denominated assets, such as Treasuries, more attractive. More dollar buying, stronger dollar.
August 5, 2022 | Daily JAM, Morning Briefing |
The U.S. economy added 528,000 jobs in July. The increase crushed all estimates. Economists surveyed by Bloomberg were looking for about half that gain. The Labor Department also revised June job gains upward to 398,000. The unemployment rate dipped to 3.5%, matching a five-decade low. Wages rose with average hourly earnings up 0.5% in July month to month. Annual wage growth came in at a 5.2% annual rate. That was the same rate as in June.
August 3, 2022 | Daily JAM, Morning Briefing |
Credit card debt rose in the United States from April through June by $46 billion, a 5.5% increase over the first quarter, as Americans borrowed billions of dollars to continue spending, according to a report on Tuesday, August 2, from the Federal Reserve Bank of New York. The increase of 13% from the second quarter of 2021 to the second quarter of 2022 was the biggest jump in more than 20 years.
August 2, 2022 | Daily JAM, Morning Briefing |
Job openings in the United States fell in June to a nine-month low. The number of available positions decreased to 10.7 million in the month from an upwardly revised 11.3 million in May, the Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS, showed Tuesday. The 605,000 decline was the biggest since April 2020. I’m sure this data has caught the Federal Reserve’s eye.
August 1, 2022 | Daily JAM, Morning Briefing |
U.S. factory activity fell to 52.8 in July, according to the Institute for Supply Management’s manufacturing survey. That’s the lowest level on this index since June 2020 and it’s a slight dip from 53 in June. In this index anything above 50 indicates expansion and anything below 50 indicates contraction. A decline in new orders seems to be behind the dip.
July 29, 2022 | Daily JAM, Morning Briefing |
Inflation, measured by the Federal Reserve’s preferred Personal Consumption Expenditures index climbed 6.8% in the twelve months that ended in June. That’s the fastest rate of growth since 1982. Core PCE inflation (that is after removing food and energy costs) rose 4.8%. The core rate was slightly above the 4.7% expected by economists surveyed by Bloomberg. In other data today wages climbed at a robust clip, although not a high enough gain to keep up with inflation.
July 28, 2022 | Daily JAM, Morning Briefing, Top 50 Stocks |
After looking like it was over earlier in the week with a significant pull back on Tuesday, July 26, stocks have rallied in the last two days, gaining 3.85% by the Thursday, July 28 close from that Tuesday low. And right now all the ducks are lined up in a row for a strong move higher. (But you know what they say about Bear Market rallies right? They’re really hard to trade and they’re even harder to sell into.)
Those ducks?
July 28, 2022 | Daily JAM, Morning Briefing |
U.S. GDP dropped by 0.2% in the second quarter (quarter over quarter) to a 0.9% annual rate of contraction. We won’t get an official call of “recession” at the earliest until economists see the labor market head south and the economic cycle guys quite probably won’t call a recession until it’s over, but I think the commonsense definition–two down quarters in a row for GDP growth–is a good indicator for investors. Consumers and companies are behaving like it’s a recession with shoppers spending money on groceries and not on furniture and CEOs announcing pending job cuts. And that’s all stuff that shows up in the revenue top line and in the earnings bottom line.
July 26, 2022 | Daily JAM, Morning Briefing |
The International Monetary Fund said today, July 26, in its update to its April world economic outlook, that the global economy could soon be teetering on the brink of recession. Three of the world’s biggest economies are all stalling and inflation is higher than previously forecast.
July 25, 2022 | Daily JAM, Morning Briefing, WMT |
Walmart (WMT) cut its profit outlook after the market close on Monday, July 25. The company isn’t scheduled to report July quarter earnings until August 16. Walmart shares dropped 9.94% in after-hours trading. Adjusted earnings per share will fall as much as 13% in the current fiscal year as U.S. shoppers take a pass on big-ticket items and focus on buying groceries (with their lower profit margins.) This is Walmart’s second warning this year
July 24, 2022 | Daily JAM, Morning Briefing |
This is the way interest rate increases from the Federal Reserve work: Higher rates hit the housing market first as mortgages get more expensive and buyers figure they’ve been priced out of the market–for this cycle.
And that’s exactly what we’re seeing in the housing market right now. On Thursday D.R. Horton (DHI), the largest U.S. homebuilder, reported that in its most recent quarter cancellations of orders for new homes climbed to their highest level in three years. The company said its cancellation rate in its most recent quarter was 24%, up from 17% during the same quarter last year.
