D&D Note (8.1.2022) ~ Stocks Slip Into the Red to Start the Month ~
Markets start August slipping into the red after posting the best month since 2020 and finishing the worst first half of the year in 50 years.
Treasury yields continue to fall with the 10 Year Yield now at 2.59% on signs inflation may be cooling.
The first grain shipment in months leaves Ukraine port of Odesa which is huge in bringing down global food prices.
The S&P 500 is now back at the top of the recent trading range. Levels need to break out above and hold 4200 to really confirm a bottom was put in earlier this year.
It’s likely the market takes a break here and grinds back down. We don’t have to go all the way back down to the bottom of the trading range or put in a new bottom, but with earnings this week being mostly unprofitable companies there could be downward pressure on the overall markets.
Some stocks the bottom is most likely in, the overall market is less likely as the FED isn’t going to “pivot” at least until September and that will be the driving force for stocks to rally into year end.
Today D&D did some selling with cutting our position in SPCE in half, reducing our position in GM by 1/3, and liquidated our holding of ABNB ahead of their earnings this week.
Stock Specific News:
Amazon launches same-day delivery for some brick-and-mortar retail brands.
Boeing gained 7% after the FFA approved protocol revisions that should allow to resume deliveries of its 787 Dreamliner.
Target rose 2% after being upgraded to overweight at Wells Fargo citing investors are too down on the stock.
Advanced Micro Devices rose 2.5% in sympathy with other semiconductor stocks rising today.
Check Point Software Technologies fell 4% after reporting disappointing billings revenue below estimates.
Bumble dropped 5.1% after being downgraded to hold at Jefferies citing decline on paying subscribers going forward.
Closing Markets (as of 1:15pm PST)
DOW down -0.14%
S&P 500 down -0.28% (4,118.63)
NASDAQ down -0.18%
VIX up 6.89% to 22.80
2 Year Note up 0.49bp to 2.89%
10 Year Note down -5.762bp to 2.59%
Oil down -4.898% to $93.79 a barrel.
Gold up 0.359% to $1788.30 an ounce.
Bitcoin down -3.87% to $22,972.97
Ethereum down -5.85% to $1,621.63
~ Dave James / Principal Trader and Market Strategist