Thursday, December 22, 2022

🔦Contradictory Data Strikes Again

. One of the frustrations for traders today is the contradictory economic data that continues to...
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. One of the frustrations for traders today is the contradictory economic data that continues to come out. For instance, the latest Conference Board data showed that inflation expectations are coming down. That's good news.

However, the labor market continues to remain strong, with the past month showing a modest increase in the ease to get a job. Some of that shift may be seasonal. But until the job market slows, it's likely that we won't see an end to the persistent inflation running rampant today.

The economy is often a mix of good and bad news. Investors should weigh those factors accordingly. The biggest factor is monetary policy. And as long as interest rates are rising, the stock market will likely continue to trend lower. Trade accordingly.

Now here's the rest of the news:

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MARKETS
DOW 33,376.48 +1.60%
S&P 3,878.44 +1.49%
NASDAQ 10,709.37 +1.54%
*As of market close
Stocks rallied on Wednesday, following strong consumer data.
Oil rose 2.9 percent, closing at $78.44 per barrel.
Gold dropped 0.1 percent, at $1,824 per ounce.
Cryptocurrencies traded lower, with Bitcoin going for $16,779 at the market close.

Today's TOP TIPS
Use Bear Markets to Accumulate Companies That Can Buck the Trend
In a bull market, investors can buy just about any stock and make money. While it's tougher in a bear market, there are several stocks that can hold their own and even gain. That's true of every bear market. 28 of the 30 Dow stocks dropped in 2008, but 2 of them managed to move higher.

In this current market, with rising interest rates and a slow economy, it's no surprise investors are turning to defensive stocks once again.

» FULL STORY

Insider Trading Report: F&G Annuities & Life Insurance (FG)
Christopher Blunt, President and CEO at F&G Annuities & Life Insurance (FG), recently added 10,000 shares. The buy increased his holdings by 2.6 percent, and came to a total cost just over $195,000.

This is the 7th buy from Blunt so far this month. These trades constitute the only insider activity at the company. F&G was recently made public via a spinoff from parent company Fidelity National Financial (FNF). Consequently, initial insider data is not yet finalized.

» FULL STORY

Unusual Options Activity: Deutsche Bank (DB)
Shares of global money center bank Deutsche Bank (DB) are down about 15 percent over the past year. One trader sees a further decline in the months ahead.

That's based on the February 2023 $10 puts. With 57 days until expiration, 9,298 contracts traded compared to a prior open interest of 149, for a 62-fold rise in volume on the trade. The buyer of the puts paid $0.32 to make the downside bet.

» FULL STORY

IN OTHER NEWS
Corporate America Largely Fine with Higher Interest Rates

About two-thirds of company CFOs in a recent survey saw now change in their spending plans as a result of rapidly rising interest rates. Interest rates now stand at a 15-year high, raising the cost for companies to borrow. About 30 percent of companies have already cut back on spending plans, but most don't see an issue as they're not planning to raise debt.
Companies Increase Collection Efforts

Several companies are increasing their collection efforts. The move is designed to bring in more cash and limit the potential of future write-offs. It can also improve working capital, as lower accounts receivable can mean a healthier balance sheet going into a recession.
Landlords Face Rising Costs

Rising repair costs are eating into the profits of small landlords looking to earn a passive income. Rising interest rates are also pricing out potential landlords, as mortgage rates have more than doubled this year. Added to the rising home prices of the past two years, and it's clear that the trend will take some time to normalize.
One in Three Adults Relying on Parents for Financial Support

Nearly one-third of GenZ and millennials over the age of 18 are still getting financial support from their parents. And nearly half of parents with adult children still have a child living at home. Nearly one-quarter of parents also provide their adult children with a regular allowance.
Starbucks NFT Program Could Increase Digital Collaborations

Starbucks Odyssey, the NFT program launched by the coffee chain, could provide an opportunity for more digital collaborations amid the rise of digital ownership of assets. That's because the program could be expanded to include other digital points, rewards, and assets beyond its starting rewards program.

S&P 500 MOVERS
TOP
NKE  12.053%
ETSY  5.641%
APA 5.586%
HAS 5.486%
ENPH 5.154%
BOTTOM
HST  5.973%
WBA 2.391%
WDC 2.19%
CTLT 2.142%
RXO 1.842%

Quote of the Day
Over 90% of central banks have hiked interest rates this year, making the (mostly) global coordinated effort unprecedented. The good news? We think we're close to the end of these rate hiking cycles, which could lessen the headwind we've seen on global financial markets this year.
- Lawrence Gillum, fixed income strategist at LPL Financial, on this year's steep global rise in interest rates, which is likely to end next year and make the investment climate less challenging for investors.

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