Monday, July 17, 2023

😬This Trend Could Prove the Real Economy Killer

Good morning. Stocks are off to a strong year. And despite the seasonal likelihood of a market...
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. Stocks are off to a strong year. And despite the seasonal likelihood of a market decline, so far stocks have held strong in the past few weeks. However, there's one trend that isn't looking strong. And it's big enough to upend the economy.

That trend is government spending. While headlines have quieted down since the debt ceiling, fiscal 2022 spending year-to-date is up 170 percent compared to the last year. And with interest rates rising, the government is on track to spend about $900 billion on interest payments on our $31 trillion in debt payments alone.

Some see a $1 trillion annual debt payment as a point of no return for the economy with spending moving out of control. While it may not mean an immediate crisis, it's a troublesome trend that could make the next recession worse. For now, traders may want to get a bit more cautious following the market rally this year.

Now here's the rest of the news:

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MARKETS
DOW 34,509.03 +0.33%
S&P 4,505.42 -0.10%
NASDAQ 14,113.70 -0.18%
*As of market close
Markets traded mixed on Friday, but still had a strong rally last week.
Oil dropped 2.0 percent, closing at $75.38 per barrel.
Gold dipped 0.2 percent, last going for $1,959 per ounce.
Cryptocurrencies slid lower, with bitcoin at $30,130 at the stock market close.

Today's TOP TIPS
Brands Continue to Reward Patient Investors
In a bull market, investors want what's going up. But fast-moving stocks can also quickly move down in a bear market. However, companies that have built strong brands tend to mostly just go up over time, even if the gains are more slow-and-steady.

That's why investors should consider strong brands as part of their portfolios. Especially when companies with strong brands are able to beat on earnings and raise estimates in uncertain times.

» FULL STORY

Insider Activity Report: Asana (ASAN)
Dustin Moskovitz, President and CEO at Asana (ASAN), recently bought 160,000 shares. The buy came to a total price of $3.475 million, and increased his stake by less than 1 percent.

This is the fourth purchase of 160,000 share lots in the past four weeks. And he has been a buyer of shares on 30 occasions going back to late 2021, without being a seller of shares.

» FULL STORY

Unusual Options Activity: JPMorgan Chase (JPM)
Megabank JPMorgan Chase (JPM) is up about 10 percent so far this year, as regional banks have plunged into turmoil. One trader sees shares moving even higher in the coming days.

That's based on the July 28 $157.50 calls. With 10 days until expiration, 22,806 contracts traded compared to a prior open interest of 104, for a staggering 219-fold jump in volume on the trade. The buyer of the calls paid $0.59 to make the bullish bet.

» FULL STORY

IN OTHER NEWS
Fed President Daly Warns Inflation Fight Isn't Over

San Francisco Fed President Mary Daly has warned that "it's really too early to declare victory on inflation." Her comments came following the report that inflation slowed to 3 percent year-over-year for the month ending in June. The Fed appears to be on track for a further quarter-point interest rate hike at the end of the month.
Despite Growth Numbers, Chinese Economy Feels Slow

While China, the world's second-largest economy, continues to post a growing gross domestic product (GDP), many measures at the consumer level point to a slowing economy. It may even feel like a recession for the average citizen, given trends such as a slowing real estate market and a lack of wage growth.
Russian Oil Prices Exceed G7 Price Cap

Recent sales of Russian crude oil have exceeded the $60 per barrel price cap employed by G7 nations as a punitive measure for the nation's invasion of Ukraine. The move is likely due to high temperatures, which has led to a surge in demand for energy, and as global oil supplies remain tight following production cuts earlier this year.
Crypto Market Jumps on Ripple/SEC Ruling

A partial win for cryptocurrency Ripple (XRP) against the Securities and Exchange Commission (SEC) in a court last week led to a jump higher for the crypto, and for the space in general. The ruling provides some regulatory clarity on whether or not cryptocurrencies are a token and subject to the SEC's regulations.
Flipkart Gives Employees $700 Million Payout

Startup company Flipkart is giving employees a one-time cash payout, amounting to $700 million. That's a record for an Indian-based startup company. The payout comes as Flipkart has spun off its PhonePe business, separating out the two companies entirely.

S&P 500 MOVERS
TOP
UNH 7.57%
ELV 5.231%
CI 4.88%
LLY 3.544%
CNC 3.236%
BOTTOM
STT 11.806%
BK 6.738%
JNPR 6.487%
GLW 6.24%
NTRS 5.986%

Quote of the Day
Regardless of how much volatility we end up seeing, given the year-to-date strength and the macroeconomic challenges, we'd expect the calls for second-half underperformance to get even louder. Amid the noise, just remember that a strong start to the year is a bullish signpost – not a bearish one – and has preceded solid second half performance far more often than not.
- Ross Mayfield, analyst at Baird, on why the market will likely rally in the second half of the year following a strong start in the first half.

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It's lifting Artificial Intelligence to a new level, answering follow up questions… admitting mistakes… challenging incorrect premises… rejecting inappropriate requests… and more.

That's why Zacks just released a Special Report that names and explains 5 tickers to lead the way.

Among them is a "Sleeper Stock" that is still cruising under Wall Street's radar.

All 5 have exceptional profit potential. There couldn't be a better time for this investor briefing.

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