Good morning. We'll jump the gun going into April and the big financial event of your year: Tax...
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. We'll jump the gun going into April and the big financial event of your year: Tax season. While you're putting together all that paperwork, the IRS just put out a report on the taxes it collected for 2021. It shows that the top 1 percent of American taxpayers – the ones so reviled by politicians – paid nearly half of all taxes at 48 percent.
And the top 10 percent of American taxpayers, which includes many members of the investment class, paid 72 percent. Finally, the bottom 40 percent of investors paid no net income taxes at all. Chances are, if you're investing in the market, you're paying some federal taxes. Overall, the picture shows that there's a high price to creating wealth.
Think you're paying too much? There are a few big things you can do to save a bundle. Investors can use structures like an IRA, Roth IRA, or 401(k) for tax benefits. And in some places, investing in municipal bonds can avoid local taxes. Finally, seven states have zero taxes on income… and it's no surprise these states have seen sizeable population growth in the past few years.
Now here's the rest of the news: | | | | | |
| | |  | DOW 32,717.60 | +1.00% | | | | | S&P 4,027.81 | +1.42% | | | | | NASDAQ 11,926.24 | +1.79% | | | | | *As of market close | | | • | Markets moved higher on Wednesday, as banking concerns eased. | | | • | Oil dipped 0.4 percent, last going for $72.90 per barrel. | | | • | Gold also dipped 0.4 percent, ending at $1,965 per ounce. | | | • | Cryptocurrencies generally moved higher, with bitcoin at $28,397 at the stock market close. | | | | | | | |
| | | Buy Assets When They're Out of Favor | | | | The market drop that started over a year ago has morphed into fears into specific sectors, such as banking. But other industries have likewise dropped to the point where investors can buy $1.00 in assets for less than $1.00.
One measure of a company's assets is its book value, or the value of its assets per share. Investors may be able to buy up bank shares for far less than book value right now – but that book may include non-performing loans.
» FULL STORY | | | | |
| | Insider Trading Report: Dollar General (DG) | | | | Timothy McGuire, a director at Dollar General (DG), recently bought 3,550 shares. The buy increased his holdings by 47 percent, and came to a total cost just over $717,000.
This marks the first insider buy at the retail chain in over two years. Company insiders have been sellers of shares otherwise, nearly entirely after the exercise of stock options. That includes the company CEO and CFO, among others.
» FULL STORY | | | | |
| | Unusual Options Activity: Alibaba (BABA) | | | | Chinese tech giant Alibaba (BABA) soared on Tuesday, amid news that the company would break into six separate companies. One trader sees further upside ahead as those plans move forward.
That's based on the August $125 calls. With 140 days until expiration, 9,704 contracts traded compared to a prior open interest of 262, for a 37-fold rise in volume on the trade. The buyer of the calls paid $4.75 to get in.
» FULL STORY | | | | |
| | • | Home Sales Rise in February
Pending home sales rose in February, by 0.8 percent. That move occurred even as interest rates started to move higher after pulling back to 6 percent. 30-year fixed rate mortgages closed in at 7 percent to end the month. The move shows that there's still demand for housing, but that buyers are sensitive to today's high interest rates. | | | | • | Corporate Profits Rise Faster than Wages
Data from 2020 to 2022 shows that employee wages rose by 14 percent, some of the best gains in years. However, corporate profits grew by 28 percent. Some see this as a sign of "greedflation" on the part of companies, and the rising prices driving those profits may be a factor in keeping inflation higher. | | | | • | Russia's Economy Shows Signs of Strain
While strong oil prices helped Russia's economy following its invasion of Ukraine, cracks are starting to show as energy prices have come back down. Investment to the country is down, and the government's budget is strained as the invasion of Ukraine enters its second year. | | | | • | Musk Calls for Pause to ChatGPT AI
Billionaire Elon Musk has joined a number of other AI researchers calling for a pause in the use of developing more AI systems. The proposal is for a six-month halt, which would allow companies to better analyze the data collected so far and make changes if appropriate. | | | | • | Microsoft Tests AI Software in the Cybersecurity Space
Tech giant Microsoft (MSFT) has introduced Security Copilot, an AI-driven program designed to summarize and make sense of threat intelligence by correlating data on attacks and prioritizing incidents. The program is similar to a number of tools that perform this tool, albeit without generative AI programming. | | |
| | | | TOP | | | INTC | 7.614% | | | | MU | 7.186% | | | | PAYX | 6.469% | | | | LRCX | 6.323% | | | | CCL | 6.002% | | | | BOTTOM | | | BBWI | 2.077% | | | | ZTS | 1.442% | | | | UNH | 1.268% | | | | TGT | 1.039% | | | | ULTA | 1.027% | | | | |
| | |  | | A lot of the move in Tech so far this year appears to be about interest rates and Fed expectations that have been falling. Tech has historically been the best performing sector after both final hikes and first cuts. But our valuation and earnings revisions work suggests there's more to the story. We remain overweight, though our call may take a breather if money flows into Banks and Small Caps return. | | - Lori Calvasina, head of U.S. equity strategy at RBC, on why tech stocks have been hit hard in the past year, and why the sector may take off as interest rates stop rising, or even start to get cut later in the year. | |
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