March 8, 2025
What You Need to Know Today:
Apple’s fourth quarter iPhone stumble is bad news for stocks
Apple (AAPL) sold 5% fewer iPhones globally and lost ground to Chinese rivals in the last quarter of 2024.
The iPhone slipped a percentage point to a 18% worldwide market share in 2024, according to Counterpoint Research data. rival Samsung Electronics also gave up share to Android smart phone makers from China, led by Xiaomi and Vivo. For the full year, Apple saw a 2% decline in sales, according to Counterpoint Research. In 2024 the global smart phone market grew by 4%.
Will S&P 500 earnings continue to accelerate for the fourth quarter of 2024?
I continue to see this rally continuing through the fourth quarter of 2024vbefore faltering in the first quarter of 2025. That call does assume that we’ll get through today’s election and its aftermath with relatively little actual violence–protests in the streets from the losing side and lots of court cases, but no mass armed violence. And it assumes that projected earnings growth in the fourth quarter will live up to expectations and show the highest growth rate in all of 2024. No one knows what this post-election period will bring. So let’s move onto assumption #2: How likely is it that fourth quarter growth will hold up?
Pick #7 CNH Industrial for my Special Report “10 new stock ideas for an old rally”
Today I added CNH Industrial (CNH) as Pick #7 for my Special Report “10 new stock ideas for an old rally.” I also added the stock to my Jubak Picks Portfolio. Here’s what I wrote:
I like farm equipment maker CNH Industrial for the same reason I own Deere (DE) in my long-term 50 Stocks Portfolio. In the long term the world’s farmers are facing a huge challenge: produce more food as an increasingly chaotic climate makes growing stuff harder and harder. One important piece of the solution is a new generation of intelligent farm equipment that uses artificial intelligence to guide everything from when to plant to when to fertilize. At the moment, though, I like CNH more on price. CNH, the #2 farm equipment maker, is invitingly attractive because it is so cheap, absolutely and in comparison to Deere.
Pick #6 Fortinet for my Special Report “10 new stock ideas for an old rally”
Today I added Fortinet (FTNT) as Pick #6 for my Special Report “10 new stock ideas for an old rally.” I also added the stock to my Jubak Picks Portfolio. Here’s what I wrote:
There’s a long-term buying cycle in the firewall cyber security sector.
Saturday Night Quarterbacks says (on a Sunday), For the week ahead expect…
In normal times, the November 7 meeting of the Federal Reserve’s interest-rate setting body, the Open Market Committee would be the big event of the week. But these aren’t normal times in case you haven’t noticed. The country faces a stark choice on Tuesday and the polls show essentially a dead heat. And then add in fears that Donald Trump and/or his followers won’t accept the election results if he loses. Traders and portfolio managers have been adding hedges to protect against market volatility in the days around the election.
Nvidia to replace Intel in Dow Jones industrials Average–another catalyst for shares
AI chipmaker Nvidia (NVDA) will join the Dow Jones Industrial Average, replacing chipmaker Intel (INTC), S&P Dow Jones Indices, the owner of the 127-year-old index, said late Friday.
Special Report: My 10 Picks for how to invest in climate change NOW–3 first 3 picks, LAZR, PLBF and GWH
Here’s how I characterize developments in the global climate crisis in 2023: It was the year when hot air confronted cold cash. And as you might expect cold cash won.
Which gives me the framework for how to invest in the global climate crisis over the next 12 to 24 months. I’m going to use natural gas to develop my investing paradigm. And then I’m going to give you four sectors in which to concentrate your investments. And 10 specific picks for your money. I expect that I’ll be revisiting the topic of how to invest in the global climate crisis again before too long–because I think today’s paradigm will need substantial revision not all that far down the road.
In Part 1 today, I’m going to develop that paradigm. In Part 2 I’m going to tell you why I think nuclear energy, utility scale battery storage, wind and solar are the sectors that deserve your investment cash and attention (and why electric vehicles don’t make the cut now.) In Part 3, I’ll give you the ten stocks and ETFs I’d pick for these four sectors.
Live Market Report (20 minute delay)
Count on another shutdown “emergency” and another temporary spending “fix”
Here’s the math that leads me to believe we’re headed to a new show down crisis when the temporary fix that keeps the government open until November 17 runs out.
The bond plunge (and soaring yields) isn’t limited to the United States
Yesterday, October 3, the yield on the 30-year U.S. Treasury hit 5% for the first time since 2007. The yield on the German 10-year bond hit 3% for the first time since 2011. In one financial market after another higher U.S. yields are driving global bond prices lower and bond yields higher.
Good news for inflation, interest rates, the Fed in today’s ADP jobs number if we can believe it
Private payrolls rose by just 89,000 jobs in September, according to figures published today by the ADP Research Institute. That’s the fewest jobs added in a month since the start of 2021. Private payrolls climbed 180,000 in August. The results trailed all estimates in a Bloomberg survey of economists. The report is more evidence of a further slowing in the labor market. “We are seeing a steepening decline in jobs this month,” Nela Richardson, ADP’s chief economist, said in a statement. “Additionally, we are seeing a steady decline in wages in the past 12 months.” Both trends would be good news for the Federal Reserve in its fight to lower inflation. And would be positives for a financial market which has seen bond yields rise and stock prices stagnate recently in fears that inflation might be staging a come back. Good news–if, that is, the ADP numbers can be believed.
My VIX Call Options are up 38% since September 25–hold ’em
The VIX, the CBOE S&P 500 Volatility Index, climbed another 12.32% today, October 2, to 19.78. The Call Options–with a strike at 17 and an expiration on December 20–I bought on the VIX on September 25 are up 38% as of the close on October 2. (I hold them in my Volatility Portfolio.) I’m inclined to hold them a bit longer because:
The yield on the 10-year Treasury jumped another 13 basis points today, October 3
Where did the slow-moving, deep and placid Treasury market go? The yield on the 10-year benchmark Treasury–you know the one used to set the interest rate on things like mortgages–moved up another 13 basis points today, October 3, to 4.80%. That’s a jump to 24 basis points in just two days. The Treasury market just doesn’t move like this. The yield on the 10-year Treasury is now up 63 basis points in the last month.
The yields keep rising
Despite the Wall Street consensus that there won’t be an interest rate increase at the Federal Reserve’s November 1 meeting, Treasury yields keep climbing. The yield on the 10-year Treasury closed at 4.68% today, October 2.
I’ll be selling Nvidia out of my Volatility Portfolio tomorrow
I’m going to take advantage of today’s pop in Nvidia (NVDA) to sell the shares out of my very short-term Volatility Portfolio tomorrow, Tuesday, October 2. The shares closed up at the close today at $447.82, a gain of 2.95% on the day. I initiated the position in the Volatily Portfolio on Mach 25, 2023. It was up 66% as of the close today So why sell Nvidia here?
And don’t forget Friday’s jobs report for September
The September jobs report is expected to show that the U.S. economy added 168,000 nonfarm payroll jobs in September with the unemployment rate dropping to 3.7%.
Could be a rocky day for Tesla shares tomorrow, Monday.
It could be a rough day ahead for Tesla (TSLA).The company has broken four quarterly car delivery records in a row, but then the results for the current quarter–which could be announced as early as Monday, Ocroer 2, are likely to show that deliveries have slipped. Not seriously. But when a stock is trading at 70 times tailing 12 month earnings per share in a nervous market, a stumble is all it takes to send a share price down. And this nervous market doesn’t need bad news from one of its leaders.
Saturday Night Quarterback (on a Sunday) says, For the week ahead, expect…
Kicking the shutdown 45 days down the road doesn’t change a single vote in Congress. The question remains exactly what it was before Saturday’s vote–Will McCarthy–or whoever is Speaker–use Democratic votes to pass legislation to fund the operations of the Federal government? Anything that increases the chances the Congress will return to its pre-vote chaos–or worse–will be a negative for financial markets. Anything that points to a full fiscal year budget based on a willingness to use Democratic votes in the House to pass a full fiscal year budget will be a positive for financial markets.
Consumer showing signs of stress in August
Inflation-adjusted consumer spending rose 0.1% last month. The report from the Bureau of Economic Analysis showed inflation-adjusted spending on services rose 0.2%, helped by a pickup in outlays on transportation and recreation. Spending on merchandise fell 0.2%, the first drop since March, as purchases of motor vehicles and home furnishings declined. While wages and salaries growth accelerated, real disposable income declined by 0.2% for a second month.
Low inflation in Fed’s favorite indicator says No interest rate increase at November 1 meeting
The Federal Reserve’s preferred measure of inflation, the Personal Consumption Expenditures index (PCE) rose at the slowest monthly pace inAugust since late 2020. The core personal consumption expenditures price index, which strips out food and energy prices, climbed just 0.1% month to month in August, according to the Bureau of Economic Analysis today, Friday, September 29. The so-called super core inflation index for services, which has been on the Fed’s watch list lately, also posted the smallest monthly advance since 2020. The super core rate also strips out housing costs. That rate climbed by just 0.1% in August.
Looking for signs of weakness in consumer spending? Did we just get one?
Consumer spending, which accounts for about 70% of U.S. economic activity, rose an annualized 0.8% in the April-to-June quarter, according to the third estimate of gross domestic product from the Bureau of Economic Analysis. The last estimate put the annualized growth rate at 1.7%.
Mortgage rates hit a 23-year high–is this the peak? (Probably not)
Mortgage rates surged to a 23-year high this week. The rate on the average 30-year fixed mortgage increased to 7.31% from 7.19% the week prior, according to Freddie Mac. That’s the highest rate since mid-December 2000, when it averaged 7.42%.
I just added moves 5,6, and 7 to Part 2 of my Special Report: Your 10 Best Moves for the Rest of 2023
I added three more moves to the four that I’d posted yesterday to bring the total moves in Part 2 of my Special Report up to 7.
Special Report: Your 10 Best Moves for the Rest of 2023, Part 2–10 of 10 Moves (revised on 10/22)
So what do you do with your portfolio for the rest of 2023? And what’s your best strategy to be prepared for 2024? In Part 1 of this Special Report I laid out the 10 developments that I thought would drive the financial markets for the rest of 223 and into 2024. Today, in Part 2, I’m going to give you the first 2 of 10 moves to take–with as much detail and as many specifics as possible–that you should be making now to position your portfolio for the uncertainties of the last quarter of 2023.
Notes You Need for September 25: MSFT market fuel, cost of car ownership, Goldman fine, Micky Dee franchise fees up, CSCO buys SPLK
I haven’t done one of these in a while, but I think that this current market is throwing up lots of hints that might contribute to an investing thesis but that don’t deserve a full post. So here I go with Notes You Need again.
Have you missed it? Some stocks are on the brink of a correction
The Standard & Poor’s 500 index (closing price) peaked on July 31 at 4588.96. The index is down 5.9% since then (as of the September 22 close.) That’s not correction territory (a drop of 10% ore more) but I’d say stocks can feel the hot breath of a correction on the back of their necks, The small-cap Russell 2000 Index has lost more than 11% from its July 31 closing high, roughly twice the decline in the S&P 500 Index over the same time. There are other signs of trouble in the stock market.
Buying VIX Call Options on signs that volatility is rebounding
Tomorrow, Monday, morning I’ll buy CBOE S&P Volatility Index (VIX) Call Options (so the options will go up in price if volatility does) for my Volatility Portfolio. I’m buying the December 20 Call Options with a strike price of 17 (VIX231220C00017000.)
Saturday Night Quarterback says, For the week ahead expect…
Expect dueling news watches this week. Garnering most of the pixels will be the countdown to a government shutdown if Congress doesn’t pass a stopgap continuing resolution to keep funding the federal government by September 30. Odds are good right now that the House of Representatives won’t meet the deadline and the many government departments will shut down next week. And on Friday, investors get the next release of the Federal Reserve’s favorite inflation series, the Personal Consumption Expenditures index.
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