Monday, November 13th 2023
Hi Oak Investors,
Welcome to another recap on the week’s action and events!
At Oak Investing, I look to provide value for all levels of investor, whether it’s pulling together the week’s best articles, insights and breaking news, or clarifying new concepts for beginners.
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Thanks,
Gordon
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Summary 📝
ANOTHER generously green week across the market as tech companies continued to rally the market higher.
Despite Federal Reserve Chair Jerome Powell spooking markets on Thursday with hawkish comments on interest rates, the market appears to be looking past these with hopes for a strong finish to 2023.
S&P 500- 1.17%
NASDAQ- 2.10%
Dow Jones Industrial Average- 0.56%
The Volatility Index continued to slide as fears of further rate hikes were priced out. This spiked somewhat towards the close on Friday as Moody’s downgraded the US.
At present, markets are pricing in a 91% chance of no change in rates at the next Fed meeting in mid December, with a 9% chance of 25BPS hike.
October’s US CPI data coming on Tuesday will give us a critical look into whether more work is needed to bring inflation closer to the 2% goal. I suspect there won’t be any further rate hikes, but the Fed need to remain firm in their language to prevent inflation from surging back.
Expectations for the October CPI Report tomorrow are as follows:
The CPI is forecast to rise 0.1% in October after increasing 0.4% in September.
Core CPI is forecast to rise 0.3% in October after increasing the same amount in September.
The CPI year over year is forecast to rise 3.3% in October after rising 3.7% in September.
Core CPI year over year is forecast to rise 4.1% in October after rising the same amount in September.
The Fear and Greed index is flat on the week, but still in Fear territory, at 42/100.
Seasonality is never far from my mind at this time of year, and it looks like the market is thinking the same thing despite some negative headlines. The average across the last 20 years has been great for the next few months, and many institutions seemingly don’t want to miss out!
Of course, nothing is a guarantee these days, but as always, if you keep to your strategy, don’t let the noise change your plan, and learn as much as you can, you can’t go too wrong over the long term!
This Week in History 📰
Source- The History Place
November 14, 1994 - The first paying passengers travelled on the new rail service through the Channel Tunnel linking England and France.
November 15, 1969 - The largest antiwar rally in U.S. History occurred as 250,000 persons gathered in Washington, D.C., to protest the Vietnam War.
November 17, 1800 - The U.S. Congress met for the first time in the new capital at Washington, D.C. President John Adams then became the first occupant of the Executive Mansion, later renamed the White House.
What’s Moving Markets? 🏃♂️
Three stories I’ve got my eye on this week. Sourced from CNBC.
Former UK Prime Minister David Cameron made foreign minister in surprise political comeback
Former U.K. Prime Minister David Cameron was appointed foreign secretary Monday in a sweeping reshuffle of current Prime Minister Rishi Sunak’s cabinet.
Downing Street confirmed the appointment after Cameron was seen walking into No. 10 to meet with Sunak.
James Cleverly was appointed as home secretary following the abrupt sacking of Suella Braverman.
Treasury Bond yields rise as investors assess U.S. economic outlook
U.S. Treasury yields were higher on Monday, as investors considered the state of the economy and awaited key inflation data due out this week for indicators of monetary policy decisions ahead.
At 4:11 a.m. ET, the yield on the 10-year Treasury was over two basis points higher at 4.6538%. The 2-year Treasury yield was last trading at 5.0665% after rising by less than one basis point.
Yields and prices move in opposite directions, and one basis point equals 0.01%.
As Biden and Xi gear up for a high-stakes meeting, experts have low expectations
Major Events This Week 🔬
Economic Events
Source- Unusual Whales
Monday
8:50 am Fed Governor Lisa Cook speaks
2:00 pm Monthly U.S. federal budget
Tuesday
3:00 am New York Fed President John Williams speaks
5:30 am Fed Vice Chair Philip Jefferson speaks
6:00 am NFIB optimism index
8:30 am Consumer price index
8:30 am Core CPI
8:30 am CPI year over year
8:30 am Core CPI year over year
10:00 am Fed Vice Chair for Supervision Michael Barr testifies to Senate panel
12:45 pm Chicago Fed President Austan Goolsbee speaks
Wednesday
8:30 am Producer price index
8:30 am Core PPI
8:30 am PPI year over year
8:30 am Core PPI year over year
8:30 am U.S. retail sales
8:30 am Retail sales minus autos
8:30 am Empire State manufacturing survey
9:25 am New York Fed President John Williams speaks
10:00 am Business inventories
10:00 am Fed Vice Chair for Supervision Michael Barr testifies to House panel
3:30 pm Richmond Fed President Tom Barkin speaks
Thursday
7:10 am Fed Vice Chair for Supervision Michael Barr speaks
8:30 am Initial jobless claims
8:30 am Import price index
8:30 am Import price index minus fuel
8:30 am Philadelphia Fed manufacturing survey
8:30 am Cleveland Fed President Loretta Mester speaks
9:15 am Industrial production
9:15 am Capacity utilization
9:25 am New York Fed President John Williams speaks
10:00 am Home builder confidence index
10:30 am Fed Governor Christopher Waller speaks
10:35 am Fed Vice Chair for Supervision Michael Barr speaks
12:00 pm Fed Governor Lisa Cook speaks
Friday
8:30 am Housing starts
8:30 am Building permits
8:45 am Boston Fed President Susan Collins speaks
9:45 am Fed Vice Chair for Supervision Michael Barr speaks
9:45 am Chicago Fed President Goolsbee speaks
10:00 am San Francisco Fed President Daly speaks
10:15 am Boston Fed President Susan Collins TV appearance
Incoming Earnings Reports
Source- Earnings Whispers
Notable Upcoming Earnings
Monday
TSN (premarket) Implied Move: +/- 6.39% Sector: Consumer Defensive
MNDY (premarket) Implied Move: +/- 11.77% Sector: Technology
FSR (afterhours) Implied Move: +/- 15.19% Sector: Consumer Cyclical
Tuesday
HD (premarket) Implied Move: +/- 3.62% Sector: Consumer Cyclical
SE (premarket) Implied Move: +/- 15.71% Sector: Communication Services
TME (premarket) Implied Move: +/- 7.80% Sector: Communication Services
Wednesday
TJX (premarket) Implied Move: +/- 3.64% Sector: Consumer Cyclical
TGT (premarket) Implied Move: +/- 6.95% Sector: Consumer Defensive
JD (premarket) Implied Move: +/- 6.45% Sector: Consumer Cyclical
XPEV (premarket) Implied Move: +/- 8.30% Sector: Consumer Cyclical
CSCO (afterhours) Implied Move: +/- 4.32% Sector: Technology
PANW (afterhours) Implied Move: +/- 7.42% Sector: Technology
Thursday
WMT (premarket) Implied Move: +/- 3.16% Sector: Consumer Defensive
BABA (premarket) Implied Move: +/- 5.01% Sector: Consumer Cyclical
AMAT (afterhours) Implied Move: +/- 4.34% Sector: Technology
ROST (afterhours) Implied Move: +/- 4.41% Sector: Consumer Cyclical
GAP (afterhours) Implied Move: +/- 8.51% Sector: Consumer Cyclical
Chart of the Week 📈
Source- Chart of the Day
The overall unemployment rate rose 0.1% to 3.9% last month, the highest level since January 2022, against expectations that it would hold steady at 3.8%.
The labor force participation rate declined slightly to 62.7% overall, while the labor force contracted by 201,000.
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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.
Great summary Gordon!!
Loving that summary graphic! The Acorn tree is a nice touch too.