Friday, February 2, 2024

👀The Fed’s Mixed Messages Mean a Market Breather Here

Good morning. Wednesday's Federal Reserve meeting went about as expected. There were no changes...
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. Wednesday's Federal Reserve meeting went about as expected. There were no changes to interest rates. But the Fed threw a few curve balls anyway. Chairman Jerome Powell threw cold water on the idea of a March rate cut, which the market expected to be the first in a series.

More ominously, the Fed dropped language about "banking system soundness." With the market coming up on the 1-year anniversary of the collapse of Silicon Valley Bank, it's a sign that we may see interest rate cuts not because of a resilient economy, but because something has broken.

For now, investors should steer wide of the regional banks, as there could be more danger ahead. Traders may want to look at short positions in those smaller banks that have yet to report earnings.

Now here's the rest of the news:

Sponsored Content
9,530x the Last Time this Happened
The last of three historically bullish crypto events is expected to happen around April 14.

It's only the fourth time in crypto history.

The last time, in 2020, certain altcoins exploded.

Some as high as 531,735% or even a 953,018% gain.

A tiny $100 investment would have returned just short of a million dollars.

Here's what our expert says you should buy before April 14.

MARKETS
DOW 38,519.84 +0.97%
S&P 4,906.19 +1.25%
NASDAQ 15,361.64 +1.30%
*As of market close
Markets rallied yesterday, reversing part of Wednesday's losses.
Oil dropped 2.7 percent, closing at $73.81 per barrel.
Gold rose 0.3 percent, ending at $2,072 per ounce.
Cryptocurrencies trended higher, with bitcoin at $43,105 at the stock market close.

Today's TOP TIPS
This Commodity Trend Points to Strong Returns for a Merger Play
Big tech earnings took some of the froth out of the recent market rally. It's also causing growth names to sell off. The selloff will likely take a few weeks to play out. That could give investors an opportunity to buy into the big-cap tech names before their next move higher.

With some companies still reporting, the real focus now should be on the big tech play with the best valuation and opportunities moving forward.

» FULL STORY

Insider Activity Report: Kimberly Clark (KMB)
Mark Smucker, a director at Kimberly Clark (KMB), recently bought 827 shares. The buy was a new position for the director, and came to a total cost of $100,051.

This marks the first insider buy at the company in the past two years. Company insiders have been regular sellers of shares, particularly division presidents and the company CEO. Most of the sales have occurred following the exercise of stock options.

» FULL STORY

Unusual Option Activity: Chevron (CVX)
Oil and gas giant Chevron (CVX) is down 12 percent over the past year as energy prices have trended lower. One trader is betting on a further decline in the months ahead.

That's based on the September $105 puts. With 230 days until expiration, 3,000 contracts traded compared to a prior open interest of 1,005, for a 29-fold rise in volume on the trade. The buyer of the puts paid $0.88 to make the bearish bet.

» FULL STORY

IN OTHER NEWS
Gundlach Warns on Recession

Jeffrey Gundlach, billionaire investor and CEO of DoubleLine Capital, sees the potential for a recession forming. The reason is the fact that investors are citing "Goldilocks" conditions with declining inflation and moderate corporate growth, even following the Federal Reserve's fastest interest rate hike in over 40 years.
FCC Proposes Outlawing AI-Generated Robocalls

The Federal Communications Commission (FCC) is proposing a rule that voice cloning tech be banned for use in robocalls, which would make it easier to prosecute those who use the technology. The technology to make automated calls was not designed with robocalls in mind, which are already illegal.
Allen Media Group Makes Buyout Offer for Paramount Global

Entertainment giant Paramount Global (PARA) is getting a buyout offer from Allen Media Group, valued at $14.3 billion. This is the second bid Allen Media Group has made for the company in less than a year. Paramount Global owns CBS and the Paramount Hollywood studio. Media companies have been out of favor over the past few years.
Regional Banks Slide as New York Community Bancorp Slashes Dividend

New York Community Bancorp (NYCB) reported a surprise loss on Wednesday, and slashed its dividend by 70 percent. The news sent down other regional bank stocks, as potential loan trouble at the company may not be contained to the wider banking industry.
Samsung Sees Future in AI-Driven Smartphones

Korean electronics giant Samsung posted its fourth consecutive quarter of declining profits, now down 35 percent over the past year. The company has lost the global smartphone race to the iPhone, but the company does see the potential to regain the top position with the rollout of AI-powered smartphones.

S&P 500 MOVERS
TOP
CTVA 18.756%
FMC 10.285%
ETSY 9.27%
NSC 9.175%
PH 7.408%
BOTTOM
CHRW 12.731%
AFL 10.179%
ZION 6.097%
MET 5.734%
QCOM 5.07%

Quote of the Day
Although inflation has come down, the Fed signaled today that it has not yet secured price stability, and will hold off cutting rates for now. This will likely strengthen the dollar over the short-term, and may be a temporary headwind for bitcoin.
- Zach Pandl, head of research at Grayscale Investments, on the Fed's policy meeting on Wednesday, which may lead to a reduction in appetite for risk assets such as tech stocks, as well as cryptocurrencies such as bitcoin.

Sponsored Content
9,530x the Last Time this Happened
The last of three historically bullish crypto events is expected to happen around April 14.

It's only the fourth time in crypto history.

The last time, in 2020, certain altcoins exploded.

Some as high as 531,735% or even a 953,018% gain.

A tiny $100 investment would have returned just short of a million dollars.

Here's what our expert says you should buy before April 14.


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