Monday, June 27, 2022

😮 Here’s How the Next Market Drop Could Unfold

Good morning. Pending home sales have now had a sixth straight monthly decline. While the...
It's the monthly jobs numbers today and they're not going to be pretty and will be possibly the tip of the iceberg as we head into May.

Good morning. Most analysts have been downplaying the prospect of a recession. That's changed in recent weeks at the macroeconomic level. But for company-specific changes, like a potential drop in earnings, Wall Street analysts look a bit behind the curve.

While some see a big profit recession for corporate America, including one who thinks it will be the worst in 50 years, chances are some sectors will fare better than others. Consumer goods companies have been good about gradually raising prices and passing off inflation to consumers. And energy companies are benefitting from a boom in energy prices right now.

Nevertheless, as the next earnings season unfolds over the summer, a number of companies will potentially surprise, mostly to the downside.

Now here's the rest of the news:

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MARKETS
DOW 31,500.68 +2.68%
S&P 3,911.74 +3.06%
NASDAQ 11,607.62 +3.34%
*As of market close
Stocks jumped higher on Friday, capping off a strong week
Oil rallied 3.1 percent, closing at $107.50 per barrel.
Gold declined 0.1 percent, going for $1,827 per ounce.
Cryptocurrencies moved slightly higher, with Bitcoin at $21,292 at the market close.

Today's TOP TIPS
This Play on Housing Should Recover Quickly, Even If the Housing Market Doesn't
The sharp rise in mortgage rates in the past year has caused the cost of financing a home to nearly double. Most investors are expecting a slowdown in home sales, as well as a price drop, as long as mortgage rates stay so high.

However, while sales may slow down, homeowners will still need to maintain their homes and continue to repair their properties.

» FULL STORY

Insider Trading Report: Occidental Petroleum (OXY)
Berkshire Hathaway (BRK-B), a major holder of Occidental Petroleum (OXY), has added another 9,551,454 shares. The buy increased the company's holdings of shares by 6.7 percent, and came to a total purchase price of just under $529 million.

Berkshire has been a regular buyer of shares at the company throughout the year. So as the company President and CEO this year. Insiders have been far more likely to be buyers rather than sellers.

» FULL STORY

Unusual Options Activity: Marathon Digital Holdings (MARA)
Shares of cryptocurrency mining company Marathon Digital Holdings (MARA) are down 77 percent in the past year, thanks largely to a decline in the price of Bitcoin. One trader is betting on a further decline through next year.

That's based on the January 2024 $2.50 puts. With 571 days until expiration, 11,496 contracts traded hands compared to a prior open interest of 288, for a 40-fold rise in volume on the trade. The buyer of the puts paid $1.11 to make the trade.

» FULL STORY

IN OTHER NEWS
Americans Adjust Spending Amid Rising Inflation

As inflation soars and gas prices approach $5 per gallon on average, many households are shifting to lower-cost substitutes. That means things like eating more frozen pizza at home instead of going out, and making coffee at home, among other ways to avoid higher prices.
Consumer Sentiment Shows Slightly Lower Inflation Expectations

Consumers expect inflation to rise at a 5.3 percent annualized rate, a slight drop from 5.4 percent last month. That's based on the latest consumer survey from the University of Michigan. The latest read is significantly lower than the current level of inflation, but is still near a record high.
Ethanol Prices Rise Faster than Oil

Ethanol, a fuel based on corn or soybeans, has seen its futures prices hit a record high. The fuel has even outperformed the performance in gas prices year-to-date. The move higher is based on strong fuel demand, and a reluctance by energy companies to drill for new sources of oil in the current market and regulatory environment.
Flight Cancellations Rise

Airlines continue to cut flights, for a variety of reasons. They include high fuel costs, weather issues, and a lack of pilots. That's putting pressure on the share price of these companies, but may also keep fares higher than average for some time.
Alexa Offers Controversial Voice Options

Smart speaker platform Alexa, owned by Amazon (AMZN) is now capable of a new feature, including the ability to change its voices to that of deceased relatives. The goal is to create a smart speaker that has a more natural and nuanced voice pattern as a way of providing more flexibility for users.

S&P 500 MOVERS
TOP
RCL  15.775%
NCLH  15.358%
PENN 12.662%
CZR 12.525%
CCL 12.435%
BOTTOM
VZ 2.169%
CTXS 1.859%
SEDG 1.78%
DVN 1.772%
WMB 1.184%

Quote of the Day
Recession talk remains the focal point on Wall Street and that means whatever stock market rebounds emerge will probably be short-lived. Wall Street won't have any answers anytime soon for the questions on when will inflation peak, how soon will we see a recession, and how high will the Fed raise rates?
- Ed Moya, senior analyst at Oanda, on why the market's rallies will likely only be part of a larger downtrend given current economic conditions.

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