The Long Term Investor

I missed the close yesterday and the markets all day today. I got a call in the early afternoon yesterday to fill in with another group last minute. So I jumped in the car.....drove for 4.5 hours.......checked into the motel. I than did the show that evening......and got up just before checkout today......and drove 4.5 hours back here. Just a few minutes ago was my first chance to check how the markets did today.

I was of course red.....moderately today. I had only two stock UP today.....TSLA and NVDA. I also lost out to the SP500 by 0.17%.

I did catch some of the market day today while driving.....it sounded like we were up for some part of the day and than faded.

 

I did hear while driving that GOOGL blew it on their new AI demo......and....that is why they got punished yesterday and today.

 

For my own benefit....to see what happened today.

Stock market news live updates: Stocks give up gains, close lower amid more earnings

https://finance.yahoo.com/news/stock-market-news-live-updates-february-9-2023-123928495.html

(BOLD is my opinion OR what I consider important content)

"U.S. stocks edged lower Thursday, giving up early-session gains in a day of topsy-turvy trading as investors parsed more corporate earnings and economic data.

The S&P 500 (^GSPC) dipped 0.9%, and the Dow Jones Industrial Average (^DJI) ticked down 0.7%. The technology-heavy Nasdaq Composite (^IXIC) slid by 1%.

The yield on the benchmark 10-year U.S. Treasury note ticked up to 3.66% Thursday. The dollar index weakened on Thursday against the euro, trading at $103.24.

Stocks closed lower Wednesday following recent Fed officials' speeches signaling that more interest rate hikes are likely to continue and that rates could remain elevated for a longer period.

Some of the standout commentary came from Federal Reserve Governor Christopher Waller, who said that an effort to reach the central bank’s 2% target “might be a long fight.” Meanwhile, New York Fed President John Williams hinted that more hikes may be needed as interest rates were “barely in restrictive territory.”

The number of Americans filing new unemployment claims rose to 196,000 for the week ended Feb. 4, the Labor Department said on Thursday, higher than the 190,000 expected by economists.

In specific stock moves, shares of Disney (DIS) rose Thursday morning after the company reported an earnings beat and revealed new restructuring plans that include eliminating 7,000 jobs from its workforce and trimming $5.5 billion in costs. It pared gains later in the session, closing 1.3% lower.

The world’s largest entertainment company delivered an adjusted earnings per share of $0.99, higher than the Street’s estimates of $0.74 cents per share. Disney lost 2.4 million streaming subscribers. Revenue jumped to $23.5 billion against forecasts of $23.4 billion.

"Disney is a bellwether for the state of the consumer and the double-digit quarterly revenue growth in its theme parks division helps to calm recession fears in the near-term," David Trainer, CEO of New Constructs, an investment research firm, based in Nashville, wrote in statement following the results.

CEO Bob Iger told CNBC’s “Squawk on the Street” that he doesn't plan to stay longer than two years at the company in his second stint at the helm of the company. Meanwhile, the highly publicized proxy "fight is over," activist investor Nelson Peltz announced on CNBC Thursday morning.

Alphabet (GOOG, GOOGL) shares slumped again Thursday, building on a big decline from Wednesday's session after the Google parent unveiled a batch of new AI-powered features for its Search, Maps, and Lens apps.

Affirm (AFRM) stock sank 17% after the company announced a 19% reduction of its staff. The move comes as the buy-now-pay-later company posted a wider-than-expected quarterly loss per share. Revenue came in at $399.6 million against estimates of $146.9 million.

Robinhood (HOOD) shares slipped after the company reported quarterly results that came in below expectations as revenue reached $380 million, against $389 million analysts forecasts.

Tesla (TSLA) shares climbed 3% Thursday following a government report that found the fatal Tesla crash in 2021 was caused by excessive speed, not by Tesla’s advanced driver-assistance features.

PepsiCo (PEP) shares rose nearly 1% after the snacks and drink giant posted an earnings beat, with earnings per share of $1.67 compared to $1.65 expected by analysts. Revenue came in at $28 billion, against $26.84 billion forecasted.

More earning results on deck for Thursday include PayPal (PYPL) and Lyft (LYFT).

In corporate news, JPMorgan also joined the array of companies making a shift in its workforce. The bank reported laying off hundreds of mortgage employees, while looking to add 500 small-business roles in the next two years.

Credit Suisse (CS) is dealing with a disaster. The Swiss lender reported its biggest quarterly loss since the financial crisis in 2008 as a slew of customers pulled out over $100 billion in funds in the latest quarter, and warned of more losses ahead.

Looking ahead, investors will be preparing for Tuesday’s CPI print, “given a dearth of catalytic information this week,” Andrew Tyler, US Market Intelligence team at JP Morgan, wrote in a note to clients. As a result, “We may be in store for a choppy next few trading sessions as, in 2022, bond [volume] tended to its largest increases around both the CPI and Fed Days.”"

MY COMMENT

All the short professionals on Wall Street are trying to revive their short strategy which got blown out of the water recently. They did not get what they wanted from Powell......so they had to revert to secondary FED members speeches today.....to try to stop the rally and bloodbath for the short sellers.

This might work for a short while....but......if the markets want to go up they are going to go up.

 

Speaking of the shorts....taking it in the shorts.

Tesla stock rally a 'short covering for the ages,' analyst says

https://finance.yahoo.com/news/tesl...ring-for-the-ages-analyst-says-193438614.html

(BOLD is my opinion OR what I consider important content)

"Tesla's stock (TSLA) has gone bananas since its early January lows, and pros say it all makes sense.

The EV maker's stock has exploded 98% to $207 from its Jan. 3 nadir as of the market close on Thursday. At this point, the gains appear to be feeding themselves in the latest FOMO (fear of missing out) Tesla stock rally.

"The demand outlook for 2023 has surpassed even the bull case scenario and caused a short covering for the ages," Wedbush tech analyst Dan Ives told Yahoo Finance via email.

The short-covering rally appears to have been set in motion by Tesla's recent price cuts.

In early January, Tesla cut the price of the Model 3 base version by $3,000 to $43,990. The Model 3 Performance variant saw a price cut of $9,000 to $53,990.

Tesla also dropped the price for the Model Y Long Range by $13,000 to $52,990 while the Performance model was cut to $56,990, about $13,000 cheaper than the prior price.

The price cuts have led to renewed demand (and perhaps market share gains) for Tesla, as CEO Elon Musk hinted at in the company's latest earnings call.

"The price cuts have been a genius move by Musk and are paying massive dividends in the field," Ives said.

Longtime Tesla bull and Ark Invest founder Cathie Wood told Yahoo Finance she believes the price cuts stem from Tesla's cost leadership position in battery technology. With that leadership position in place, Tesla could continue to bring down prices and stoke even more demand.

Or at least that's one thesis that may be underpinning the latest surge in the stock.

"I think traditional auto manufacturers are going to have trouble keeping up with the price declines that Tesla's technology is enabling," Wood said on Yahoo Finance Live (video above).

To be sure, not everyone on Wall Street shares the bullish optimism on Tesla, even while the stock rips higher.

Some pros think price cuts will prove to be damaging to the Tesla brand over the long term while hurting profit margins at the same time.

"Based on the statement that [Elon Musk] made on the fourth quarter earnings call, saying that his demand is 2x his supply, you'd be silly to cut price," BofA analyst John Murphy told Yahoo Finance Live. "You would just be eating into your profitability and not achieving any more incremental volume in the near term.""

MY COMMENT

I just LOVE all the armchair experts telling Musk what to do and how he should be doing it. After all what does Musk know.......he is just the face of the entire USA space program.....the most successful EV maker in the world......the person behind the company giving the world the internet and other digital content in the near future (Starlink)......and now.....one of the founders of the new darling company......OpenAI.

The guy most be an idiot not to follow all the free advice he gets from.....analysts.

 

My view of this week is the 10 year Treasury Yield is the primary factor.

 

I have not been doing anything but listen to the markets since the open. I have been busy making spaghetti sauce. You see where the markets today rank in my order of importance. First things first.

Seems like a typical open hour for this week. Ten Year Treasury is UP and the markets are lingering to the down side and trying to move down a little more.

SOMEONE BUY SOMETHING.

 

DUH......

As investors cheer 'disinflation,' Jamie Dimon says not so fast: Morning Brief

https://finance.yahoo.com/news/jami...on-inflation-yet-morning-brief-110029706.html

(BOLD is my opinion OR what I consider important content)

"Investors betting on U.S. stocks took a victory lap last week after Federal Reserve Chair Jerome Powell embraced the presence of “disinflation” in the U.S. economy.

JPMorgan (JPM) chief executive Jamie Dimon, however, argues this excitement is premature.

“I just think people should take a deep breath on this one before they declare a victory because a month’s number looked good,” Dimon said Wednesday in an interview with Reuters in Miami, Florida, referring to recent signs inflation pressures have eased in the economy.

“I think it’s perfectly reasonable for the Fed to go to 5% and wait a while and see” the lagged effects of its policy on inflation in the economy, Dimon added.

Dimon's pushback on recent confidence that the price increases are stabilizing came one day after Powell said in an interview with financier David Rubenstein at The Economic Club of Washington, D.C. that the "disinflationary process has begun" in the U.S. economy.

Even as Powell added "additional rate hikes were needed," investors again seemed to shrug off this promise for tighter policy.

Last year when Dimon correctly prophesied the aggressive bout of interest rate increases that the U.S. central bank would proceed to unleash on the economy, he issued the following warning during an earnings call: "This whole notion that it’s somehow going to be sweet and gentle and no one is ever going to be surprised I think is a mistake."

At the time, investors were bracing for three or four rate hikes.

In the end, the Fed raised rates at the most aggressive pace in two generations, increasing its benchmark interest rate at each of its final seven meetings of 2022, bumping up its benchmark interest rate target by a cumulative 4.25% in the process.

Dimon's comments, as ever, are made as a bank executive, not a monetary policymakers.

But it was a little more than one year ago that Dimon was among the first voices on Wall Street to predict as many as six or seven increases would be on the table in 2022.

"Inflation may not come down like people think," Dimon told Reuters on Wednesday.

DataTrek's Nicholas Colas pointed out Powell's comments did not sway the market's expectations of the likely path of monetary policy this year. In the aftermath of the speech, the rate-sensitive two-year Treasury yield was unchanged at 4.46% — while federal funds futures were at 4.50-4.75%.

These moves, or the lack thereof, indicated policy rates over the coming 24 months could remain where they are now, rather than the 5% Fed officials have warned about.

Dimon said if inflation comes down to 3.5% or 4% and fails to budge, the Fed may have to "go higher than 5% – and that could affect short rates [and] longer rates."

Dimon's position is also shared by Federal Reserve officials, who have consistently asserted the terminal rate for its current hiking cycle will likely be above 5%.

And if last year's experience tells us anything, bet against Jamie Dimon at your own risk."

MY COMMENT

LOL.....this article is simply a PR puff piece for Diamon. As the article notes in the end.....what Diamon is saying is the same as what the FED is saying.

The article has it backwards.....the FED is not sharing Diamons opinion.....he is sharing and repeating their OBVIOUS opinion.

The FED has told us for at least 6 months now that their target is about 5 to 5.5%. I have no idea why the financial media constantly pushes the story line that "investors shrug off the promise of tighter policy". I dont see or hear that....except in media articles.....everyone I know has a very clear view of where the FED is going. They are going to do exactly what they say they re going to do.

All I can say is......DUH.

 

Cue the scary, fear mongering headlines.

Stock market news live updates: Stocks fall, S&P 500 on track for worst week of year

https://finance.yahoo.com/news/stock-market-news-live-updates-february-10-2023-123111493.html

(BOLD is my opinion OR what I consider important content)

"U.S. stocks fell Friday morning as the indexes were on track to end the week on a downbeat note.

The S&P 500 (^GSPC) was down 0.4%, on pace for its worst week of 2023, while the Dow Jones Industrial Average (^DJI) sunk 0.2%. Contracts on the technology-heavy Nasdaq Composite (^IXIC) slid 0.9%.

The yield on the benchmark 10-year U.S. Treasury note ticked up to 3.7% Friday morning. The dollar index ticked up 0.2% to trade at $103.40. Crude oil jumped on news that Russian would cut production, with the US benchmark WTI futures rising over 2% in early trading.

Stocks ended the day lower on Thursday, reversing earlier gains from the day’s trading session as traders parsed through more corporate earnings and economic data.

The S&P 500 has seen choppy price action over the past week, losing more than 1%, after the Federal Reserve raised its short-term interest rate by a quarter percentage point. Data from Bespoke Investments shows that most sectors are trading on the downswing — excluding energy, which has rallied 1% — while communication services has been the weakest performer.

Meanwhile, low liquidity in the market pushed a move in bonds, as the bond market is repricing higher terminal rates and fewer rate cuts in second half of 2023 after last week's hot jobs report, Fedspeak and the “comeback in auto prices,” Andrew Tyler, US Market Intelligence team at JP Morgan, wrote in a note to clients.

On the macro front, the consumer sentiment index rose 66.4 in February, raising it to the highest level since January 2021. The results were higher than January's reading of 64.9 and consensus expectations of 65.

"The improvement could reflect a strengthening in labor market conditions over the past couple of months evident in the payrolls and official job openings data," Andrew Hunter, Senior US economist at Capital Economics, wrote in a statement following the release.

In specific stock moves, shares of PayPal (PYPL) rose after the platform company posted quarterly results after the bell on Thursday. PayPal’s total payment volume missed by 2% from analyst expectations. Net revenue climbed 6.7% year over year. PayPal’s adjusted earnings per share of $1.24 beat analyst expectations by 3%, which helped drive stronger-than-expected guidance.

On the corporate side, President and CEO Dan Schulman announced his retirement from the company at the end of the year. Schulman will continue to serve on the board of directors while the company searches for a successor.

Meanwhile, Lyft (LYFT) stock sank more than 30% after the ride-share company reported first quarter earnings that came in at $975 million, which was below consensus expectations of $1.09 billion. The adjusted net loss of $270.8 million was more than the $90.2 million loss from the same period a year ago.

Cloudflare (NET) stock climbed Friday after the company reported earnings that came in above analyst expectations.

Expedia (EXPE) shares fell before the opening bell after the travel company posted quarterly revenue of $2.62 billion, below expectations of $2.71 billion. Adjusted earnings per share of $1.26 missed analysts' consensus of $1.77.

On the retail side, Adidas faces a billion-dollar problem. The German sportswear giant warned of a $1.3 billion loss in revenue this year as the company was unable to sell Yeezy clothing and shoes.

Coinbase (COIN) shares dipped Friday morning after rival Kraken faced regulatory penalties of $30 million as part of a settlement with the Securities and Exchange Commission. The crackdown sparked Coinbase CEO Brian Armstrong to tweet concern about “rumors” that the SEC would “like to get rid of crypto staking in the U.S.”

Bitcoin stands at about $21,844 Friday morning, leading to the assumption that the digital asset “appears to have entered into a correction phase,” said Craig Erlam, a senior market analyst at Oanda."

MY COMMENT

This week is all about the Ten Year Treasury yield.

I love the headline.......STOCKS FALL...WORST WEEK OF THE YEAR. OMG....run for the hills it is the worst week of the whole year. Well yeah....the year only being about 6 weeks long at this point......and....considering that nearly every week so far has been POSITIVE.....ok, yeah.

YES....we are going to have many down weeks this year. We are even going to see many down weeks in a row at times. We might even see a correction this year. It is going to be a typical....."normal".....market year. Very erratic and many up and down times.

Welcome to reality.

 

I love thee headlines.....here is another example.

U.S. stocks waver as S&P 500 heads for worst week since December; traders eye inflation report

https://finance.yahoo.com/m/4d07b202-fad8-31d3-a5d0-594d90c386cb/u-s-stocks-waver-as-s-p-500.html

LOL......worst week since December.......yeah about 6 weeks ago. See comment above no need to repeat myself.

 

Here is one from the Wall Street Journal....seeing a theme here today?

Stocks Waver as S&P 500 Heads for Worst Week So Far This Year

https://finance.yahoo.com/m/e5d25b26-ab3a-3f02-aa12-8832fa7bd0b7/stocks-waver-as-s-p-500-heads.html

 

For some mysterious reason we are seeing a concentrated focus on moving the markets down today with all the negative media. You got to love the short term markets and financial media

 

Just nothing going on today other than Treasury Yields . It is such a slow day i saw one article touting the Consumer Sentiment data as a big deal that investors were waiting for today.

You have got to be kidding.....any day where Consumer Sentiment is the big deal of the day is a real SNOOZE-FEST.

Of course.....we will also have the usual FED talkers out in force today trying to talk things down.

 

Way to go Emmett. Keep up the good work.

 

After scanning all my usual financial news and other sources.....I cant find anything else. it is really a boring market day with nothing new going on.

Add in the fact that I am a long term investor and normally do nothing......and it is really BORING today.

I guess I will go and start my siblings tax return.

 

I just looked at my account for the first time today. I have a low/moderate loss going on today. Most of my stocks are showing a minor percentage loss. Gives me some slight hope for a turn around this afternoon since the losses I am showing on most of my losing stock holdings are very shallow. I do have a few items positive today....at the moment.