I’m making a switch today (well, actually tomorrow) in the Perfect 5 ETF Portfolio Out goes the iShares Large Cap China ETF (FXI). In comes the ProShares Short MSCI Emerging Markets (EUM). My weighting remains the same at 15% of the five-ETF portfolio.
The bill, known as the Chips for America Act, is a pared-down version of a broader set of competition measures and would authorize $52 billion in grants and loans for chip manufacturers, as well as a new, four-year 25% investment tax credit for chip making. Senate Majority Leader Chuck Schumer has pressed for a vote today with final passage as early as next week.
The Standard & Poor’s 500 was on track for a decent day–the index was up 0.79% at 12:43 p.m. New York time–and then Bloomberg broke a story, picked up everywhere, reporting that Apple (AAPL) intended to slow hiring and reduce spending growth next year. The S&P 500 finished the day down 0.84% and Apple shares closed down 2.06%.
My one-hundred-and-fifty-ninth YouTube video “Trend of the Week Hedging with Commodities Lives” went up today. The strong dollar has knocked commodity plays around. But the reasons for buying these hedges still hold. Inflation. Supply shortages (especially in agricultural commodities.) I think there’s still a strong case that commodities are a good way to hedge this market.
Shares of Citigroup climbed by 13.23% on Friday, July 15, after the company reported earnings of $2.19 a share. Revenue came in at $19.6 billion. Wall Street had projected earnings of $1.689 a share and revenue of $18.4 billion. So it’s not surprising that the stock rose strongly after the report. Or that the gains dragged other bank stocks higher too. For example, Bank of America (BAC), which reports on Monday, July 18, gained 7.04%. Wells Fargo (WFC) climbed 6.17%. To which I say, Thank you, and I’m selling.
Analysts at New York investment house Cowen now expect worldwide mobile phone shipments this year to decline by 6% from a year ago to 1.36 billion. In 2023, the company projects shipments will dip by another 2% to 1.33 billion units. Perhaps most worrying for investors is Cowen’s analysis of where the market problems lie: In weakness in the high-end smartphone market.
Today, July 12, shares of American Airlines (AAL) closed up 9.98%. The company announced that it expects to post a pretax profit of $585 million in the second quarter as vacationers pack planes during the summer peak season. The company expects revenue to be about 12% higher than in the same quarter in the pre-Pandemic year of 2019.
My one-hundred-and-fifty-fifth YouTube video “Quick Pick UUP Dollar ETF” went up today. In my video yesterday (if you missed it, go watch!) I explained why a strong dollar has hit commodity stocks hard, and why I think the dollar will continue to be strong. One strategy I suggested: Investing in an ETF that tracks the dollar. My recommendation here is Invesco Dollar Index Fund (UUP). I’ll be adding it to my ETF Portfolio on my JubakAM.Com subscription site on July 8.
As I said in my recent video “Quick Pick Kimberly-Clark,” I’m adding this stock to my Dividend Portfolio effect tomorrow July 6. The stock pays a dividend of 3.39%. That’s not knock-your-socks-off stuff, but very good for a very defensive consumer staples stock as we move closer to a recession. The stock is down 2.69% year to date as of the close on July 1 but the shares are up 10.31% in the last three months
It’s not surprising given the greater than expected decline in U.S. first quarter GDP reported on Wednesday, which followed on the slump in consumer confidence reported Tuesday, that stocks in the consumer staples sector outperformed both consumer discretionary stocks and the market in general. The Consumer Staples Select Sector SPDR ETF (XLP) gained 0.63% on Wednesday, June 29. By contrast the Consumer Discretionary Select Sector SPDR ETF (XLY) lost 0.08%.
The Conference Board’s latest reading on consumer confidence showed consumer expectations in June fell to their lowest level since 2013. The consumer confidence index for June fell to 98.7 from 103.2 in May, below expectations for a reading of 100. The report’s expectations index, which is based on consumers’ short-term outlook for income growth, the job market, and overall business conditions, fell to 66.4, its lowest reading since March 2013.
The advice is sound, very sound. Move part (at least of your portfolio to cash and sit out the worst of this bear market on the sidelines. And since you have that cash in hand, you’ll be ready to snap up bargains when the market has put in a bottom (or near the bottom, or on the way up from the bottom…or something.) But right now that’s easier said than done.
