Edition #31-Tuesday, May 30th 2023
Summary 📝
Markets had a nicely green week as the prospect of a deal on the debt ceiling increase moved in the right direction, with a deal progressing on Sunday. With the potential of credit downgrades if no deal is reached, this really matters.
Semiconductor giant Nvidia NVDA 0.00%↑ had a tremendous week as it reported earnings, with forward guidance considerably higher, sending AI and technology stocks upwards.
The Fear and Greed index climbed further into Greed category at 68/100.
The Volatility Index at 17.2 continues to remain low when compared to the last few years, climbing down further from the range of the last few weeks.
Overall, the debt ceiling will likely continue to be the main issue. Whether the resolution leads to a “sell the news” event, or if the relief felt in the market leads stocks higher is anyone’s guess. I want to keep some cash on the side-lines in the event of some volatility.
Quiz Question of the Week ❓❓
Answer at the bottom!
This Week in History 📰
Provided by The History Place
May 30, 1783 - The Pennsylvania Evening Post became the first daily newspaper published in America.
June 3, 1937 - The Duke of Windsor married Wallis Warfield Simpson in Monts, France. As King Edward VIII, he had abdicated the British throne in December of 1936 amid tremendous controversy to marry Simpson, an American who had been divorced.
June 4, 1944 - During World War II in Europe, Rome was liberated by the U.S. 5th Army, led by General Mark Clark.
Major Events This Week 🔬
Economic Events (EST)
Provided by Unusual Whales
Monday - Markets Closed
Tuesday
9:00 am S&P Case-Shiller home price index (20 cities)
10:00 am Consumer confidence
1:00 pm Richmond Fed President Barkin speaks
Wednesday
8:15 am ADP employment
9:45 am Chicago Business Barometer
10:00 am Job openings
12:30 pm Philadelphia Fed President Patrick Harker speaks
2:00 pm Federal Reserve Beige Book
Thursday
8:30 am Initial jobless claims
8:30 am U.S. productivity
9:45 am IS&P U.S. manufacturing PMI
10:00 am ISM manufacturing
10:00 am Construction spending
1:00 pm Philadelphia Fed President Patrick Harker speaks
Friday
8:30 am U.S. employment report
8:30 am U.S. unemployment rate
8:30 am U.S. hourly wages
8:30 am Hourly wages year over year
Incoming Earnings Reports
Provided by Earnings Whispers
Notable Upcoming Earnings
Provided by Unusual Whales
Tuesday
HPQ (afterhours) Implied move: +/- 6.4% Sector: Technology
HPE (afterhours) Implied move: +/- 8.1% Sector: Technology
Wednesday
AAP (premarket) Implied move: +/- 8.3% Sector: Consumer Cyclical
CRM (afterhours) Implied move: +/- 8.4% Sector: Technology
AI (afterhours) Implied move: +/- 24.7% Sector: Technology
CRWD (afterhours) Implied move: +/- 9.9% Sector: Technology
JWN (afterhours) Implied move: +/- 13.4% Sector: Consumer Cyclical
Thursday
M (premarket) Implied move: +/- 12.9% Sector: Consumer Cyclical
DG (premarket) Implied move: +/- 5.5% Sector: Consumer Defensive
AVGO (afterhours) Implied move: +/- 7.4% Sector: Technology
VMW (afterhours) Implied move: +/- 6.4% Sector: Technology
LULU (afterhours) Implied move: +/- 8.1% Sector: Consumer Cyclical
Post of the Week 💌
❗️Oak Investing website launch👇🚀
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What’s Moving Markets? 🏃♂️
Provided by CNBC
Stock futures rise after GOP and White House reach tentative U.S. debt ceiling deal: Live updates
‘Everyone is a programmer’ with generative A.I., says Nvidia chief
Nvidia’s Chief Executive Jensen Huang says “everyone can be a programmer” as generative artificial intelligence will understand multiple forms of input, including speech.
A.I. will not only be able to create new applications, but enhance existing ones.
Wall Street sees further upside for Japan stocks as they notch a fresh three-decade high
Goldman Sachs strategists see Japan stocks benefiting from “structural changes” in the economy.
BofA strategists see the Topix index rising to 2,300 points, an additional 7% gain from current levels.
BofA’s bull case is for the Topix to rise to 2,400 points.
Japan’s Topix (Tokyo Price Index) has marked new peaks in the past two weeks, seeing its highest level since July 1990 on Monday.
Chart of the Week 📈
Provided by Chart of the Day
Investors are increasingly on edge as debt ceiling talks have yet to produce a deal. Going down to the wire in 2011 was disastrous for the stock market — something nobody wants to repeat this time around.
The 2011 debt ceiling standoff led to about a 17% decline in the S&P 500 from late-July to mid-August 2011. The X-date back then was Aug. 2, and a deal was finally struck on July 31 — about as close to the deadline as you can get.
The risks of the current dance turning out like 2011 — especially with Fitch now placing the United States’ AAA rating on a negative rating watch — are plain to see looking at this chart.
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Quiz Question of the Week- Answer ❓
Answer- C 6.6%
Description: The January 2023 World Economic Outlook Update projects that global growth will fall to 2.9 percent in 2023 but rise to 3.1 percent in 2024. The 2023 forecast is 0.2 percentage point higher than predicted in the October 2022 World Economic Outlook but below the historical average of 3.8 percent. Rising interest rates and the war in Ukraine continue to weigh on economic activity. China’s recent reopening has paved the way for a faster-than-expected recovery. Global inflation is expected to fall to 6.6 percent in 2023 and 4.3 percent in 2024, still above pre-pandemic levels.
Source- https://www.imf.org/en/Publications/WEO
Thanks for reading, have a great day!
Gordon
Disclosure ✅
This newsletter provides general information only. Before making any financial or investment decisions, please consult a financial planner to take into account your personal investment objectives, financial situation and individual needs.