D&D Note (7.6.2022) ~ FED Minutes Spark Late Day Rally ~
Treasury Rates where volatile today swinging the overall markets. Post the FED minutes release bond yields reversed to 2.93% on the 10 Year Note and stocks rallied in the last hour of trading. Markets gave back some of the gains but finished in the green for the day.
The 2-10 year spread remains inverted at -5.09% down -3.18bp.
FED minutes from the last meeting released today show that its likely appropriate they do a 50-75bp rate hike at the July meeting. But also say pressure for additional hiking is slowing. Overall the FED reaffirms their commitment to curbing inflation over job creation.
There has been a noticeable rotation out of Energy and into Growth Tech. We might be coming near the end of the Energy Sector flush as investors reallocate back into Growth Tech which is being funded by proceeds from the energy complex.
Stock Specific News:
Apple introduces new Lockdown Mode designed to protect iPhones from state-sponsored hacks.
Toyota sold its 200,000th electric vehicle and joins Tesla and General Motors in phasing out of US tax credits for customers.
Uber & Doordash fell today after Amazon agreed to take a stake in Grubhub where Prime subscribers get a one-year membership to the food delivery app.
Coinbase fell after being downgraded at Atlantic Equities to neutral and cut price target citing increased volatility in the crypto space.
Netflix fell after Barclays cut its price target to $170 from $275 with an anticipation of subscriber loss in the 2nd quarter.
Rivian surged over 10% after saying they produced 4,401 vehicles, delivered 4,467 in line with expectations and are on track to deliver 25,000 this year.
GameStop announced a 4 for 1 stock split and the stock rallied 8% before quickly retreating back in the after-hours.
Closing Markets (as of 1:15pm PST)
DOW up 0.23%
S&P 500 up 0.36% (3,845.08)
NASDAQ up 0.35%
VIX down -2.90% to 26.74
2 Year Note up 15.18bp to 2.97%
10 Year Note up 11.80bp to 2.92%
Oil down -1.035% to $98.47 a barrel.
Gold down -1.423% to $1738.80 an ounce.
Bitcoin down -2.07% to $20,318.88
Ethereum up 0.64% to $1,157.33
~ Dave James / Principal Trader and Market Strategist