 | | |  Good morning, and happy Labor Day. Friday's payroll data showed that the US economy grew by 315,000 jobs last month. That's just over expectations for a rise of 300,000. Overall, that's good news. And most of the time, the market would cheer that on, as more jobs means more people being paid, and more spending in the economy as a result.
This time, however, is a bit different. That's because the Fed is working to fight inflation. And in order to fight inflation, people need to spend less. For that to happen in aggregate, there need to be fewer jobs. This latest data likely sealed the deal for a 0.75 percent interest rate hike later this month, and raised the chances of rates continuing to rise into the end of the year.
That's bad news for assets like stocks and bonds. Traders should lighten up long-side trades, and investors should continue to look for trades that can benefit from a further decline in stocks.
Now here's the rest of the news: | | | | | |
| | |  | DOW 31,318.44 | -1.07% | | | | | S&P 3,924.26 | -1.07% | | | | | NASDAQ 11,630.86 | -1.31% | | | | | *As of market close | | | • | Stocks moved lower on Friday, following the latest jobs report. | | | • | Oil rose 0.5 percent, closing at $87.03 per barrel. | | | • | Gold rallied 0.6 percent, last going for $1,720 per ounce. | | | • | Cryptocurrencies traded lower, with Bitcoin at $19,892 at the stock market close. | | | | | | | |
| | | Don't Let a Buying Opportunity Go to Waste in a Crisis | | | | There's an old saying that the Chinese character for "crisis" can also be interpreted as "opportunity." That's often the case in the stock market, where a big selloff can lead investors to years of profits relatively quickly when the fears fade and prices rebound.
Right now, some tech stocks are getting hit hard on news that the US government is limiting chip exports to China. That can have an impact on a number of companies, but two look to be hit the hardest.
» FULL STORY | | | | |
| | Insider Trading Report: Freeport-McMoRan (FCX) | | | | Ryan Lance, a director at Freeport-McMoRan (FCX), recently added 31,000 shares to his holdings. The buy increased his stake by a staggering 368 percent, and came to a total price of just over $988,000.
The move comes as another director bought 3,000 shares back at the start of August. Over the past three years, insiders have generally been more active as sellers rather than buyers of the company stock.
» FULL STORY | | | | |
| | Unusual Options Activity: Ovintiv Inc (OVV) | | | | Shares of oil exploration and production company Ovintiv (OVV) are up 87 percent over the past year thanks to a strong energy market. One trader sees the possibility for a short-term drop in the coming weeks.
That's based on the October $45 puts. With 46 days until expiration, 12,906 contracts traded compared to a prior open interest of 299, for a 43-fold rise in volume on the trade. The buyer of the puts paid $2.43 to make the downside bet.
» FULL STORY | | | | |
| | • | China Locks Down Chengdu Over Covid 19
Chengdu, one of China's most populous cities with over 21.2 million people, is shutting down due to an outbreak of Covid 19. These shutdowns have been common across Chinese cities, and they have often resulted in factory shutdowns and delays that have further hampered global supply chains. | | | | • | Americans Buy European Properties Amid Strong Dollar
With the Euro trading at its lowest level against the US dollar in 20 years, many Americans are looking at buying property in Europe. With the dollar up nearly 15 percent over the past year compared to Europe's currency, other goods and services are providing a boost for American buyers overseas. | | | | • | Bank of America to Offer Zero-Down-Payment Mortgages in Some Minority Communities
Financial giant Bank of America (BAC) has launched a new loan program offering zero-down-payment mortgages for first time homebuyers. The catch? It's offered in only some African American or Hispanic markets, in a move to reduce racial inequality in the housing market. The loans also ditch traditional credit scores, instead looking timely payments for rent and other bills. | | | | • | Cruise Recalls 80 Robotaxis Following Crash
Cruise, the autonomous vehicle division of General Motors (GM), has recalled 80 robotaxis following a crash in June, in which two people suffered minor injuries. The vehicles have had their software updated. The company stated that the event was a "rare occurrence" as only one incident has occurred out of 123,560 similar conditions. | | | | • | Mickey Mantle Baseball Card Sets Record
A Mickey Mantle rookie baseball card has set a record for the most valuable piece of sports memorabilia ever sold, with the buyer paying $12.6 million. The card dates back to 1952, and is considered the finest example known of that card. Sports memorabilia has seen its popularity explode since the pandemic. | | |
| | | | TOP | | | CF | 4.218% | | | | MOS | 3.653% | | | | HAL | 3.611% | | | | HES | 3.512% | | | | MRO | 2.929% | | | | BOTTOM | | | DISH | 4.745% | | | | GNRC | 4.034% | | | | ZBRA | 3.826% | | | | J | 3.754% | | | | VRTX | 3.57% | | | | |
| | |  | | The June lows are in play in the coming weeks as equity investors finally recognize the intensity of the Fed's mission. Inflation and recession are typically accompanied by lower market multiples and markets need to reassess valuation as interest rates rise. A successful test of June lows may also prove important as the double-bottom formation could help alleviate fears of further volatility in the months ahead. We believe consensus profit forecasts for next year are too high and technical support will be necessary as forecasts come down. | | - John Lynch, chief investment officer at Comerica Wealth Management, on why the market may form a double-bottom in the weeks ahead as stocks re-test the June lows. | |
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