Edition #22- Monday March 27th 2023
Quiz Question of the Week ❓
Answers at the bottom!
This Week in History 📰
March 28, 1979 - Near Harrisburg, Pennsylvania, the Three Mile Island nuclear power plant accident occurred in which uranium in the reactor core overheated due to the failure of a cooling valve
March 30th, 1853- Vincent Van Gogh (1853-1890) was born in Groot Zundert, Holland. He was a Postimpressionist painter, generally considered the greatest Dutch painter after Rembrandt.
April 2, 1792 - Congress established the first U.S. Mint at Philadelphia.
Summary 📝
Another wild week in the market as uncertainty in the banking world continued to dominate headlines.
The market rose after a bumpy week in which the Fed hiked interest rates by 25BPS, and indicated that some more work is needed, but that progress was encouraging.
Defensive names in healthcare, consumer staples and industrials continue to perform well, with more speculative companies suffering as investors look to protect their cash.
With no FOMC meeting in April, the next meeting on May 3rd looks to be more than likely a skip month, with no rate hikes expected by 65% of respondents, and only 35% expecting another 25BPS hike.
If inflation continues to cool in the next CPI/PPI readings, and the banking crisis starts to calm down, we might see a period of minimal disruption, but it’s never that easy in the market right?
Volatility is going nowhere, as Block SQ 0.00%↑ dropped 20% last week, GamestopGME 0.00%↑ soared 45%, and First Republic Bank FRC 0.00%↑ rose 46%. Plenty of investors will be tempted to time the market with such investments, but never forget the essentials of a good investment:
Long term plan- entry and exit price, investment duration;
Solid fundamentals- cash reserves, profit, growing metrics;
Clear understanding of what the company does;
Confidence in the management.
Major Events This Week 🔬
MONDAY, MARCH 13
Dallas Fed Manufacturing
Fed Gov. Jefferson speaks
TUESDAY, MARCH 14
Consumer Confidence
Fed Gov. Barr testifies to Senate on banks
WEDNESDAY, MARCH 15
Fed Gov. Barr testifies to House on banks
THURSDAY, MARCH 16
US PCE
US GDP
Initial jobless claims
FRIDAY, MARCH 17
University of Michigan Confidence
Fed Gov. Waller speaks
New York Fed President Williams speaks
Fed Gov. Cook speaks
Incoming Earnings Reports This Week
Provided by Earnings Whispers
Notable Upcoming Earnings
Monday
CCL (premarket) Implied Move: +/- 12.7% Sector: Consumer Cyclical
BNTX (premarket) Implied Move: +/- 5.8% Sector: Healthcare
Tuesday
WBA (premarket) Implied Move: +/- 6.0% Sector: Healthcare
FUTU (premarket) Implied Move: +/- 10.5% Sector: Financial Services
MU (afterhours) Implied Move: +/- 7.5% Sector: Technology
LULU (afterhours) Implied Move: +/- 8.2% Sector: Consumer Cyclical
JEF (afterhours) Implied Move: +/- 9.9% Sector: Financial Services
Wednesday
TIGR (premarket) Implied Move: +/- 14.2% Sector: Financial Services
PAYX (premarket) Implied Move: +/- 6.8% Sector: Industrials
RH (afterhours) Implied Move: +/- 9.7% Sector: Consumer Cyclical
CNXC (afterhours) Implied Move: +/- 8.9% Sector: Technology
Thursday
NEOG (premarket) Implied Move: +/- 7.1% Sector: Healthcare
BB (afterhours) Implied Move: +/- 10.4% Sector: Technology
SKLZ (afterhours) Implied Move: +/- 25.4% Sector: Communication Services
Market Futures
Provided by Unusual Whales Futures
Follow my CNBC Watchlist at- Oak Investing Watchlist
Post of the Week 💌
✅ I get a lot of questions about why I chose an oak tree as the symbol for this amazing investing community. 🌳
✅ Think about the ideal investment. It survives any environment, is stable through difficult times, and continues to grow the whole time. Sound familiar? 🌳
✅ Investing legend Warren Buffett is quoted as saying “Someone's sitting in the shade today because someone planted a tree a long time ago.”. If you can put your money to work, it might just look after you in the future. 🌳
What’s Moving Markets? 🏃♂️
Netanyahu survives no-confidence vote as angry protests, strikes paralyze Israel over judicial reforms
Israeli Prime Minister Benjamin Netanyahu’s administration proposed a series of widely contested government reforms that would empower his position while weakening the judiciary.
Netanyahu fired his defense minister who opposed the motion, triggering renewed protests across the country.
Israel’s largest union body announced a general strike as flights out of Israel’s Ben Gurion airport in Tel Aviv were suspended.
China’s debt-heavy local governments look for new ways to raise cash
Local governments’ direct debt exceeded 120% of revenue in 2022, S&P Global Ratings analysts said, noting that’s more than what Beijing has unofficially said was an acceptable debt level.
In the annual government work report released this month, an entire section was dedicated to preventing and defusing major risks in real estate and local government debt.
A few local governments are trying other ways to generate extra income — at the cost of fair market access for bike-sharing businesses. That’s according to two reports in the last half year from China’s National Development and Reform Commission, which oversees economic planning.
TikTok wants to distance itself from China — but Beijing is getting involved
China would “strongly oppose” a forced sale of TikTok from its Beijing-based parent ByteDance, Ministry of Commerce spokesperson Shu Jueting said Thursday.
This comes after TikTok’s CEO Shou Zi Chew was grilled by U.S. lawmakers in an intense five-plus hour hearing in Congress on Thursday over concerns of the app’s links to China.
“At the end of the day, it was clear from the testimony that Mr. Chew reports to the CEO of ByteDance. ByteDance controls TikTok,” said Cameron Kelly, visiting fellow at Brookings Institution, on CNBC’s “Squawk Box Asia” on Friday.
Chart of the Week 📈
Yet again we find ourselves in the middle of two key levels of support and resistance as investors take a cautious stance following uncertainty in the financial sector.
With interest rates approaching a potential peak, and inflation starting to cool off, some investors may speculate that the worst is behind us, but with memories of 2008 lingering, nobody wants to get too carried away.
I suspect that if we can get some clarity on the state of the banking sector, including the more systemically important such as Deutsche Bank, then investors may start to put their money to work. However, there are still many events and risks which could hijack a rally. Having a suitable balance of risk and growth is going to be critical for investors over the next year until the following can be understood or resolved:
China/Taiwan tensions;
Recession severity;
Inflation and interest rate response;
Ukraine/Russia geopolitics.
Wealth Builder’s Podcast 📻🎧
Last week, I made an appearance on the latest episode of the Wealth Builder’s Podcast, talking about my approach to investing, the mistakes and lessons learned along the way, and what I think is next for the market.
Investor’s Toolkit ⚒️
Unusual Whales- Options Flow and Analysis
5% off with code OAK2022
5% Discount with code OAK
Follow for More 🎉
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.
Quiz Question of the Week- Answer ❓
Answer C- BSE India
The BSE India Limited exchange holds 5,519 listed companies. This is the largest number globally. The North American exchange with the greatest choice is the TMX Group in Toronto, which has 3,413 listed stocks.
Source: World Federation of Exchanges.