The CPI report released... December CPI: Inflation rises 6.5% over last year. Inflation rose at a slower rate again in the final month of 2022, a welcome downtrend in consumer prices after the Federal Reserve raised interest rates to the highest level in 15 years. The Consumer Price Index (CPI) for December showed a 6.5% rise in prices over last year and a 0.1% decrease over the prior month, government data showed Thursday, on par with consensus estimates compiled by Bloomberg. On a "core" basis, which strips out the volatile food and energy components of the report, prices climbed 5.7% year-over-year and 0.3% over the prior month. The core CPI readings also came in as expected, based on Bloomberg's forecasts. Policymakers monitor "core" inflation more closely due to its nuanced look at key inputs like housing, while the headline CPI figure has moved largely in tandem with volatile energy prices last year.
From the US Bureau of Labor Statistics (CPI)....the deeper details show what we all know here lately. Your groceries continue to cost more. Food The food index increased 0.3 percent in December following a 0.5-percent increase in November. The food at home index rose 0.2 percent in December. Three of the six major grocery store food group indexes increased over the month. The index for meats, poultry, fish, and eggs increased 1.0 percent in December, as the index for eggs rose 11.1 percent. The index for other food at home rose 0.4 percent over the month, while the index for nonalcoholic beverages increased 0.1 percent in December. In contrast, the fruits and vegetables index fell 0.6 percent over the month with the fresh fruit index declining 1.9 percent. The index for dairy and related products decreased 0.3 percent in December, and the index for cereals and bakery products was unchanged. The food away from home index rose 0.4 percent in December, after increasing 0.5 percent in November. The index for limited service meals increased 0.5 percent over the month and the index for full service meals increased 0.1 percent. The food at home index rose 11.8 percent over the last 12 months. The index for cereals and bakery products rose 16.1 percent over the year. The remaining major grocery store food groups posted increases ranging from 7.7 percent (meats, poultry, fish, and eggs) to 15.3 percent (dairy and related products). The index for food away from home rose 8.3 percent over the last year. The index for full service meals rose 8.2 percent over the last 12 months, and the index for limited service meals rose 6.6 percent over the same period.
The markets this morning have been all over the place, at least early on. No doubt the reports and all of the comments are adding to it. Unfortunately, this is part of our environment the last several months and likely well into the upcoming months. Not that we can do much about it and if it wasn't this, it would likely be some other issue. A nice little excerpt from an article. INVESTING IS A TOXIC mix of fear and overconfidence that’s colored by the recent past and driven by unfounded forecasts. Want to introduce a bracing dose of rationality? Start by thinking about what you can control—and what you can’t. (Humble Dollar). I think that pretty much sums it up.
Todays close. SP 500 3,983 (+% 0.34) DJIA 34,189 (+% 0.64) NASDAQ 11,001 (+% 0.64) Russell 2000 (+% 1.74)
Our little green streak continues. Yes, it is over a "short term" in all respects, but it is just nice to see some consecutive days of up markets after all the things everybody has endured up to this point. Nothing wrong with some enjoyment from it. Plus, you have some "ownership" in the companies you have selected to invest your money in. When they do well, you reap some of those benefits as well. I think many long term investors have that "ownership" type of view with the selections they decide to choose. Yes, it may be a small slice in the grand scheme of things, but that type of thinking incorporated into your evaluation/selection and decision making does make a difference within the mindset of how you hold and construct what you are doing. Anyway, a good day and we will take all of those we can notch on our belt at this point.
Earnings reporting from some of the banks.... On the earnings front, JPMorgan (JPM) posted better-than-expected fourth-quarter earnings as CEO Jamie Dimon said the the U.S. economy "remains strong." JPMorgan said earnings for the three months ending in December were pegged at $11.1 billion, or $3.57 per share, up 7.2% from the same period last year. Bank of America (BAC) reported fourth-quarter earnings that showed the bank’s revenue benefited from higher interest rates. Bank of America reported revenue of $24.5 billion in the quarter, topping estimates of $24.2 billion. That was 11% higher from the year-ago quarter. Wells Fargo (WFC) also posted quarterly earnings that beat expectations, while revenue came in below Wall Street forecasts. The financial heavyweight reported fourth-quarter earnings of 67 cents a share on revenue of $19.7 billion, compared with year-earlier earnings of $1.38 a share on revenue of $20.9 billion. BlackRock (BLK) posted fourth-quarter profit dropped 23%, while reporting net income of $1.26 billion in the same period a year earlier. Citigroup (C) posted net income of $2.5 billion, or $1.16 per diluted share, which slightly topped expectations for $2.3 billion, or $1.14 per share. (Yahoo Finance).
A few other earnings that beat estimates... UnitedHealth Group (UNH) UnitedHealth Group Reports 2022 Results Delta Air Lines (DAL) Delta Air Lines Announces December Quarter and Full Year 2022 Profit
We start our Friday off in the red. Now that I think about it. WXYZ left us with a full plate of issues to look after. The CPI noise, earnings, and Friday the 13th..
We end Friday with all three index in the GREEN. SP 500 3,999 (%+0.40) DJIA 34,302 (%+0.33) NASDAQ 11,079 (%+0.71)
I am back and have everything all organized and am ready to go for the week. When you start a little road trip....you are entering a different world for as long as it lasts. When it is over.....you reenter the real world. It went nicely. I have to get one speaker re-coned......a JBL D120F......but otherwise all good. That re-cone will cost me about $200......but.....it is a business write off. You guys did a GREAT job of managing the markets on Thursday and Friday......those were not easy days. BUT.....you extended the GREEN to six days in a row.....at least for me. WELL DONE.
I have a small gain right now for the day and there is very good potential for the markets to firm up as the day goes on. The big drag on the DOW today is Goldman and Travelers earnings. At this moment I have five stocks UP and five DOWN.......the Up stocks are AAPL. MSFT. COST, NVDA, and TSLA. SP500 and NASDAQ are bounding back and forth between red and green.
What bear market? For investors that have some ability to focus on the long term and more than a few days.....things are looking significantly UP. The future looks good and the recent past ALSO looks good. LOTS.....of pluses in the list below. SP500 5 days +1.81% 1 month +4.50% 3 month +7.25% 6 month +1.35% 1 year (-14.43%) 3 year +21.07% DOW 5 days +0.64% 1 month +3.54% 3 month +11.12% 6 month +6.58% 1 year (-5.54%) 3 year +17.02% NASDAQ 5 days +3.12% 1 month +5.04% 3 month +2.84% 6 month (-5.41%) 1 year (-25.61%) 3 year +18.92% We are already moving beyond the big hole that we got into at the start of last year. I consider it EXTREMELY POSITIVE that the FED is close to the end of their rate increases over the next 2-4 months.
NASDAQ and the SP500 are in a hand to hand knife fight for direction today. We will see at the close. HERE is the problem with the DOW today. Stocks fall as Wall Street's big banks report profit drops https://finance.yahoo.com/news/stock-market-news-live-updates-january-17-2023-115704146.html (BOLD is my opinion OR what I consider important content) "U.S. stocks fell Tuesday morning as a shortened but busy week packed with corporate earnings got underway on Wall Street. The Dow Jones Industrial Average (^DJI) shed 350 points, or around 1%, weighed down by bank stocks after Goldman Sachs (GS) posted its largest earnings miss in a decade. The S&P 500 (^GSPC) and technology-heavy Nasdaq Composite (^IXIC) each Goldman Sachs recorded a larger-than-expected 69% drop in profit for the fourth quarter, taking a hit on a substantial decline in dealmaking revenue and a higher provision for loan losses. Shares fell nearly 7%. Morgan Stanley, meanwhile, reported a smaller-than-expected decline in profit. Like its Wall Street peers, the bank's investment banking operations took a big hit, but higher net interest income and a record quarter for its wealth management business helped cushion overall numbers. Shares rose roughly 6%. The reports come after a lackluster round of quarterly updates from peers late last week. Earnings reports out of other sectors will also ramp up in the coming days, with figures from Netflix (NFLX) on Thursday in focus. The update is likely to serve as a potential sign of things to come for the tech sector's results, which are set to begin in earnest the following week. The S&P 500 is expected to report a year-over-year decline in earnings of 3.9% for the fourth quarter, according to data from FactSet Research. This would mark the first year-over-year decline in earnings reported by the index since a 5.7% drop in the third quarter of 2020. "We expect earnings to take the center stage going forward, where reactions to earnings have been getting bigger, while reactions to inflation/FOMC have been waning," Bank of America's Savita Subramanian and Ohsung Kwon wrote in a note Friday. Global business leaders are gathering in the mountains of Davos, Switzerland, this week for the World Economic Forum. The prospect of a global recession, post-pandemic challenges, climate change, and the crisis in Eastern Europe are poised to top the agenda for the politicians, CEOs, and billionaires in attendance. European Central Bank President Christine Lagarde is among attendees. The week ahead will also be busy with Fedspeak, with several members of the U.S. central bank set to deliver remarks in speeches throughout the country in coming days. U.S. Treasury yields ticked higher Tuesday morning, with the benchmark 10-year note rising roughly 5 basis points to top 3.55%. Oil futures were up slightly. West Texas Intermediate Crude Oil (WTI) futures traded around $80 per barrel as of 6:55 a.m. ET. Tuesday's moves come after a long weekend that saw the U.S. stock and bond markets closed on Monday, January 16, in observation of Martin Luther King Jr. Day. On Friday, all three major averages closed out their second consecutive winning week. The technology-heavy Nasdaq Composite saw an outsized gain of 4.8% for the week, while the S&P 500 and Dow Jones Industrial Average registered their best performances since November, logging weekly advances of 2.7% and 2%, respectively." MY COMMENT BUMMER for Goldman.....but....who cares. these big banks jump all over the board quarter to quarter and have little relevance to the average investor. AND.....contrary to the tone of this little article.....the banks have in general been BEATING expectations so far this earnings season. NEGATIVITY....sells clicks in the financial media. I personally have ZERO earnings this week....but.....I am looking forward to AAPL, TSLA, and MSFT next week.
Just like the EXTREME low mortgage rates of the past 2-3 years were a golden opportunity.....NOW.....is a great opportunity over the next six months for those that want secure cash equivalent investments to produce SAFE income. the coming months will be a golden time to put in place a nice CD ladder. We have not seen the rates that we are seeing now for a long time.
YES......it is still going to be a day to day and week to week struggle.....but the mood is changing. Treasury yields edge up following better-than-expected economic data https://finance.yahoo.com/m/72f18d53-57b6-3c87-8262-5dfb9e08cc84/treasury-yields-edge-up.html (BOLD is my opinion OR what I consider important content) "U.S bond yields were slightly higher on Tuesday as traders returned from a three day holiday weekend a touch more optimistic about the global economy. What’s happening The yield on the 2-year Treasury TMUBMUSD02Y, 4.232% rose by 2.1 basis points to 4.241%. The yield on the 10-year Treasury TMUBMUSD10Y, 3.534% added 4.5 basis points to 3.550%. The yield on the 30-year Treasury TMUBMUSD30Y, 3.641% climbed 5.2 basis points to 3.666%. What’s driving markets A batch of better-than-expected economic data from across the globe Tuesday helped push U.S. bond yields higher as investors returned to their screens following the Martin Luther King holiday. First up was news that China’s economy grew 3% last year. Though this was the second weakest pace of expansion since the 1970’s, it was nevertheless better than analyst forecasts and raised hopes the world’s second biggest economy was more resilient than expected as it battled COVID. Next, data out of the U.K, showed the labor market remained in relatively robust health, while a survey of German business sentiment on the economy jumped from minus 23.3 in December to 19.9 in January. The building optimism about the European economy was reflected in comments from European Central Bank governing council member Mario Centeno, who told a panel in Davos that: “The economy has been surprising us quarter after quarter…The fourth quarter in Europe will be most likely still positive. Maybe we’ll be surprised also in the first half of the year.” U.S. Treasury yields tracked their European peers higher, with the 10-year German bund adding 1 basis point to 2.183 and the U.K. gilt up 3.2 basis points to 3.419%. U.S. data due for release on Tuesday include the Empire State manufacturing index due at 8:30 a.m. Eastern. Markets are pricing in a 91.2% probability that the Federal Reserve will raise its policy interest rate by another 25 basis points to a range of 4.50% to 4.75% after its meeting on February 1st, according to the CME FedWatch tool. The central bank is expected to take its Fed funds rate target to 4.9% by June 2023, according to 30-day Fed Funds futures. The Bank of Japan will deliver its monetary policy decision at 9:30 p.m. Eastern What are analysts saying “After trading near the cycle lows of late last year into 3.40% for the 10-year benchmark on benign inflation data last week and a series of very strong auctions for especially longer-dated US Treasuries, the 10-year yield rebounded toward 3.50% on Friday and traded slightly higher overnight after coming back from the long holiday weekend. The next US macro data point of note is perhaps tomorrow’s December retail sales release,” said strategists at Saxo Bank." MY COMMENT We are seeing a distinct backing off from the constant and total negativity of last year. Thank goodness for the new year. BUT....we will still have a lot to deal with and a lot ahead of for us this year. SO: COURAGE......ENDURE. I say.....the worst is behind us now. The bear market bottomed in June of 2022. When we look back in hindsight we might....emphasis on "might"......just see that the bear market ended at that time. Not that I really care. I dont invest according to whether we are in a bear or bull market or short term technicals. It is all about long term earnings, business fundamentals, and compounding those gains for the long term.
Amazon story of the day......not unexpected......and.....a good thing for stock owners. Lets get that productivity UP. Amazon begins cutting 18,000 workers in its biggest layoffs ever Amazon's layoffs are just a fraction of its 1.5M global workforce https://www.foxbusiness.com/lifestyle/amazon-begins-cutting-18000-workers-in-biggest-layoffs-ever (BOLD is my opinion OR what I consider important content) "Amazon's workforce reduction – the largest in its history – will begin Wednesday. Earlier this month, Amazon CEO Andy Jassy told employees in a blog post that the company was laying off about 18,000 people as it seeks to cut costs and would begin contacting impacted employees on Jan. 18. "Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," Jassy said in the Jan. 4 post. "These changes will help us pursue our long-term opportunities with a stronger cost structure." Amazon declined to comment beyond the blog post. The layoffs, which are just a fraction of its 1.5 million global workforce and part of the company's ongoing annual operative review, will mostly impact the company’s Amazon Stores division — which encompasses its e-commerce business as well as company’s brick-and-mortar stores — and its PXT organizations, which handle human resources and other functions. Jassy first warned employees in November that layoffs were on the horizon given the uncertain economy and the fact that the company rapidly hired over the pandemic. In the Nov. 17 post, Jassy told employees that Amazon decided to eliminate a number of positions across its devices and books businesses. He also announced a voluntary reduction offer for some employees in its PXT organization. Amazon's workforce reduction – the largest in its history – will begin Wednesday. Earlier this month, Amazon CEO Andy Jassy told employees in a blog post that the company was laying off about 18,000 people as it seeks to cut costs and would begin contacting impacted employees on Jan. 18. "Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," Jassy said in the Jan. 4 post. "These changes will help us pursue our long-term opportunities with a stronger cost structure. As part of the company's annual operating planning review, it looks at each of its businesses to see what changes need to be made for the long-term health of the business. However, Jassy further warned that there would be more role reductions in early 2023 as part of this annual planning process. Although the company didn't disclose a headcount at the time of the November announcement, the Wall Street Journal reported that 10,000 positions would be impacted." MY COMMENT This is very much needed across all the big tech companies. These companies need to get lean and mean. They got overly BLOATED during the past 10-15 years.....especially all the little.....day to day..... perks that some of them routinely provide to coddle employees.
STILL....trying to figure out why I was not invited to DAVOS to meet with all the other financial ELITES.
It was a good day in the old market neighborhood today.....at least for me. A small gain but still real money today. I am now POSITIVE for the past SEVEN market days. I also beat the old SP500 today by 0.32%. I will definately take it over a red day. I had five stocks UP today......AAPL, MSFT, COST, NVDA, and TSLA. I am now nicely up by nearly $10 per share on the TESLA shares that I mentioned buying about two weeks ago. Lets keep it going for the rest of the week......I want 14 days in a row.
