Tuesday, March 7, 2023

😟China’s Slowdown May Prove a Boon for U.S. Consumers

Good morning. China put forward its latest economic growth targets… and it's less than expected....
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. China put forward its latest economic growth targets… and it's less than expected. The country was expected to see a boom this year as harsh Covid lockdown measures were finally lifted in the country at the end of 2022.

If China doesn't grow as much as expected, then chances are commodity prices will take a breather. The biggest beneficiary may be U.S. consumers, as gas prices may stay lower at the pump for longer, freeing up money to spend elsewhere. Energy prices have held up well the past few years, but remain well under the spike higher they made when Russia initially invaded Ukraine.

Investors may want to scale back more speculative energy trades right now. Overall, slower global growth may also continue to weigh on stocks, so expect market volatility to continue.

Now here's the rest of the news:

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MARKETS
DOW 33,431.44 +0.12%
S&P 4,048.42 +0.07%
NASDAQ 11,675.74 -0.11%
*As of market close
Markets traded mixed on Monday, with the Nasdaq closing slightly lower.
Oil rose 1.1 percent, last going for $80.55 per barrel.
Gold dipped 0.1 percent, ending at $1,852 per ounce.
Cryptocurrencies traded flat, with bitcoin at $22,362 at the stock market close.

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Follow Real Operational Growth for Big Profits, Not Just a Fast-Moving Stock
While a share of stock is a fraction of a company, its valuation can vary wildly. Intense fear or greed can lead to big swings in valuation, often quickly. Over time, however, growing earnings and revenue tend to be a reliable indicator of a company's performance.

But if you combine a company with improving operational results that's also seeing interest in its shares exploding higher, you may be on track to profit from a big trend.

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Insider Trading Report: NextEra Energy (NEE)
Kirk Hachigain, a director at NextEra Energy (NEE), recently added 10,000 shares. The buy increased his holdings by 25 percent, and came to a total cost of $700,000.

Insiders have been notable buyers of shares so far this year, with 8 total buys. That includes both company executives, including the CFO, as well as directors. The last sale occurred from an option exercise back in December.

» FULL STORY

Unusual Options Activity: Apple (AAPL)
Consumer tech giant Apple (AAPL) dropped about in-line with the overall stock market last year. Shares look ready to move higher, however, and one trader is betting on a sizeable move in the coming weeks.

That's based on the April 14 $160 calls. With 37 days until expiration, 3,871 contracts traded compared to a prior open interest of 110, for a 35-fold rise in volume on the trade. The buyer of the calls paid $1.89 to make the bullish bet.

» FULL STORY

IN OTHER NEWS
Housing Market Stalls as Spring Approaches

Mortgage applications have slid to their lowest level in decades, as interest rates have started to creep higher again. 30-year fixed rate costs went from a peak of 7 percent in November to just over 6 percent in February before moving higher again. Home sales and activity have continued to slow as borrowing costs have soared.
Car Debt Delinquencies on the Rise

Total auto loan debt has jumped to $1.55 trillion, and rising interest rates are leading to higher total car payments. The typical new car owner is now paying an average of $700 per month, up from $567 in early 2020. Payment delinquencies are also on the rise.
Taiwan Semiconductor Plans to Hire 6,000 This Year

Taiwan Semiconductor (TSMC), which produces an estimated 90 percent of the world's most advanced chips, is planning to add 6,000 jobs this year. The move comes as the rest of the industry sees a slowdown, with a number of companies reporting a rise in inventories. The company is largely hiring across Taiwan for engineering and production line operators.
Microsoft to Add Copilot to Business Apps

Tech giant Microsoft (MSFT) is adding its Copilot AI program across the company's portfolio of business apps. The company describes it as the "next generation" of AI product updates. The Copilot AI is designed to automate the most repetitive tasks for sale sand customer service jobs.
SiriusXM Plans to Cut 8 Percent of Staff

Satellite radio provider SiriusXM (SIRI) plans to lay off about 475 workers, or about 8 percent of its workforce. The move is part of a broader reorganization, that recognizes the challenges of the current economic environment. Sirius is also looking to scale back its content and marketing spending.

S&P 500 MOVERS
TOP
LUMN  4.574%
DPZ  3.988%
MRK 3.972%
ENPH 3.864%
NRG 2.319%
BOTTOM
DXCM 7.598%
NWL 7.261%
VFC 5.065%
MTCH 5.043%
EW 3.986%

Quote of the Day
The stock market is very sensitive to bond yields at this point and looking for some respite to the recent upward moves in yields. There's a nervous anticipation to upcoming data releases for jobs and inflation after the difficult readings last month. The market is unlikely to have sustained traction until data points resume a cooling trend.
- Yung-Yu Ma, BMO Wealth Management chief investment strategist, on why investors will want to watch for a change in direction on bond yields before getting overly bullish on the stock market.

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