Monday, August 29, 2022

🎮Your Game Plan for An Autumn Selloff

Good morning. On Friday, Federal Reserve Chairman Jerome Powell warned of "economic pain" ahead...
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. On Friday, Federal Reserve Chairman Jerome Powell warned of "economic pain" ahead, as the central bank remains committed to further increasing interest rates. Markets didn't like the news, as it means a pivot away from that policy may not occur until next year.

That likely means markets are back in a downtrend, and will potentially retest their June lows in the coming weeks. Adding to that possibility is historical seasonality: September and October are the two worst months of the year for the stock market.

Traders should look to sell out of any speculative names now, and continue to look for short-term trades to benefit from a market decline in the coming weeks.

Now here's the rest of the news:

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MARKETS
DOW 32,283.40 -3.03%
S&P 4,057.66 -3.37%
NASDAQ 12,141.71 -3.94%
*As of market close
Stocks sank on Friday, following a hawkish speech by Fed Chairman Jerome Powell.
Oil rose 0.4 percent, closing at $92.87 per barrel.
Gold slipped 1.2 percent, last going for $1,750 per ounce.
Cryptocurrencies dropped, with Bitcoin at $20,669 at the stock market close.

Today's TOP TIPS
Investors Still Love Industry Leaders Now
It's a challenging market, but a few themes have been playing out in recent weeks. Great companies are holding up better than lower-quality ones in the same industry. And even with all the uncertainty out there right now, investors are willing to buy great companies well off of last year's highs.

That theme is playing out this earnings season. Companies that have been reporting poor numbers may be selling of, but investors have been swooping in to buy.

» FULL STORY

Insider Trading Report: Flowers Foods (FLO)
Thomas Chubb, a director at Flowers Foods (FLO), recently added 3,000 shares. The buy increased his stake by nearly 15 percent, and came to a total cost of $82,500.

The buy came a few days after the company President and CEO sold just over 143,000 shares. Insider trading history has been mixed over the past three years, with a few periods with large buys and sells by executives and directors

» FULL STORY

Unusual Options Activity: Petroleo Brasileiro (PBR)
Shares of oil giant Petroleo Brasileiro (PBR) are up 36 percent in the past year thanks to strong energy prices. One trader sees the possibility of a pullback in the coming weeks.

That's based on the October 21st $14 put option. With 53 days until expiration, 150,545 contracts traded compared to a prior open interest of 4,570, for a 34-fold rise in volume on the trade. The buyer of the puts paid $1.16.

» FULL STORY

IN OTHER NEWS
Powell Warns on Continued Rate Hikes

Speaking from the Federal Reserve's annual retreat in Jackson Hole, Wyoming, Chairman Jerome Powell warned that the central bank remains committed to fighting inflation, even as the economy shows signs of slowing. The market interpreted the comments are more hawkish than expected, leading to rising expectations for a 0.75 percent rate hike in September.
Russia flaring Nearly $10 Million in Natural Gas Daily Amid Nord Stream Shutdown

Russia is losing nearly $10 million daily as it flares natural gas at a facility near the border with Finland. Approximately 4.34 million cubic meters of gas daily are being flared at an LNG facility. The move comes as gas that would otherwise have been exported to Western Europe has been stranded amid a shutdown of the Nord Stream pipeline.
Midwest Drought Keeping Grain Prices High

In addition to high fuel and fertilizer costs, the outlook for grain markets has dropped in recent days as extreme heat and a drought have impacted the Midwest. Corn yields in Nebraska have recently been dropped by 13 percent, and other grains such as soybeans also look on track for lower production this year.
T-Mobile Phones To Connect to Starlink For Free Next Year

T-Mobile (TMUS) has inked a deal with SpaceX to link its phones to Starlink satellites next year. The uplink will use existing cellular bands, and should allow the company to enable global roaming anywhere with satellite coverage. The process has been described as similar to a cell tower, but with more technical challenges for a better range.
Ford Raises Prices on Electric Mustang Due to Higher Battery Costs

Ford Motors (F) will increase prices on its electric Mustang crossover. The price could increase by as much as $8,000 for some models. The company says the increase is due to market conditions, ongoing supply chain issues, and higher material costs for EV batteries.

S&P 500 MOVERS
TOP
EA 3.585%
WDAY 3.16%
MOH 3.07%
TTWO 1.474%
CF 0.899%
BOTTOM
MMM 9.159%
HPQ 8.805%
NVDA 8.798%
ALGN 7.458%
DLTR 7.355%

Quote of the Day
If we get a real sense that inflation is entrenched, and we're at 9% inflation or something like that, no one is happy about that. It doesn't matter what [the Fed will] say — 50, 75, 100 — that level of inflation is not good for stocks, particularly growth stocks…We need some evidence. Otherwise, we're gonna have inflation that's too high for too long and that is not good for the stock market.
- Karen Firestone, analyst at Aureus Asset Management, on why the stock market is looking at inflation as the prime mover up or down in the months ahead.

Sponsored Content
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Something astronomical is happening…

We're seeing a major shift of institutional capital.

I'm talking billions and billions of dollars.

Moving from tech-focused areas of the market toward energy-related stocks.

Presenting investors with a once-in-a decade buying opportunity.

But only if you get into the best stocks.

Click here for my free report which will give you two low-priced and undervalued Energy stocks.

(By clicking you agree to receive email updates and special offers from True Market Insiders)


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