Speaking of the Ten Year. 10-year yield climbs as investors await Fed speaker comments, economic data https://www.cnbc.com/2023/08/21/us-treasurys-investors-await-fed-speaker-comments-economic-data.html (BOLD is my opinion OR what I consider important content) "U.S. Treasury yields climbed on Monday as investors braced themselves for comments from Federal Reserve officials and economic reports expected throughout the week. The yield on the 10-year Treasury was up by more than 4 basis points at 4.29%, trading near levels last seen in 2022. The 2-year Treasury yield was trading over 2 basis points higher at 4.97%. Yields and prices move in opposite directions. One basis point equals 0.01%. Investors await a series of comments from Fed policymakers, including Chairman Jerome Powell, ahead of and during the central bank’s annual Jackson Hole symposium, which begins Thursday. Many are hoping for fresh clues about the outlook for interest rates. That comes after minutes from the Fed’s latest meeting, released last week, suggested further rate hikes could be announced depending on the state of the economy and whether inflationary pressures continue. Since the Fed’s last meeting in July, officials have expressed mixed views about whether further interest rate hikes are needed. Many investors had hoped and expected that the Fed’s latest interest rate hike at its July meeting marked the end of its rate-hiking campaign. The central bank has hiked interest rates 11 times since early 2022 in an effort to cool the economy and ease inflation. On the data front, investors will closely follow the latest existing and new home sales reports and durable goods orders figures which are slated for this week. No key data is due Monday. Elsewhere, China’s central bank cut its one-year loan prime rate by less than expected on Monday while leaving its five-year rate unchanged. That comes after the People’s Bank of China announced surprise interest rate cuts last week as weak economic data raised concerns about the state of the economy." MY COMMENT REALLY nothing going on right now.....so the NVDA earnings and the small amount of economic releases are being hyped and take on outsize expectations. The FED......who cares.....they either have one more rate hike in their bag of tricks.....or....they are done. Either way they are done. It is actually a very boring and meaningless news time for the markets. Earnings are warping up and were much stronger than expected. The FED is done. The economic data is uniformly coming in very nicely over the past months. The day to day click hunters continue to try to constantly ramp up the drama.....that is just the norm in the social media society.
Of course...having mentioned APPLE above it is down so far today......the little pariah of the BIG CAP TECH world right now. The disrespect continues. As we are now about an hour into the day.....the Ten Year yield is at 4.341%.....and the SP500 has lost most of its gains. The NASDAQ is still hanging in there but has moderated. NVDA is making a good run up today. The ONLY event that really matters.....in terms of the media..... this week are the NVDA earnings on Wednesday. I dont see it....but....this single stock earnings report will be extrapolated to the entire market perhaps for the rest of the year. This is just SILLY.....but that is how things work right now......short term.
Well we have now exhausted our art budget for this year. We received a Bronze Sculpture that we ordered this week. That is our final item for this year. We do have another Bronze on order....but it will not be ready from the foundry till early next year so that will come out of next years budget. Our Bronze purchases tend to be living artists.....versus....our paintings that tend to be dead artists and more historic. But....even though living....we are very picky in what we will buy as sculpture. We tend to stick with ICONIC items that are well recognized......and....will hopefully stand the test of time.
I just did my mid-morning account check. I have a very nice gain so far.....but it is one of the strangest days I have seen in a while. That gain is being generated by only three stocks.....NVDA, MSFT, and AMZN. ALL my other six stock are down for the day. BUT....I will take it. If only three stock can give me a good gain.....fine with me. It is all about the WHOLE portfolio....not the individual companies. The above gives me some clue that the averages today are not as strong as they look in terms of all the individual companies that make them up. It is a very selective rally today.....which means it can disappear on a dime as the day goes on.
Nice day for NVDA and AMD. I am sitting tight on both for now. I have no plans on selling NVDA but would like to reduce my AMD position at the right time. I am crunching the numbers on how early I want to pay my house off and some other financial planning. With the returns the market is giving me at the moment it doesn't make sense but that will not always be the case. It would create a less risky haven plus diversify my portfolio a little. My current goal is to pay off this house and build our 'forever home' and just roll the money right into the new house.
Sounds like a good plan TireSmoke. Nothing like a paid off house. The ultimate emergency hedge as a source of money and/or a safe haven to live in.
Looks like NVDA pulled the rest of the markets up by their bootstraps today. NVDA......up by $36.68 or 8.47% today. I hope someone has some inside information of the earnings.....and.....not just bare speculation. As to my account including NVDA.......a good gain today. Only three stocks down today.....the non-tech bunch.....COST HD, and NKE. I also kicked the SP500 in the butt today by 1.31%.
As to NVDA. Nvidia Targets Keep Rising as Analysts Bet on Earnings Blowout https://finance.yahoo.com/news/nvidia-targets-keep-rising-analysts-164157579.html (BOLD is my opinion OR what i consider important content) "(Bloomberg) -- Nvidia Corp. shares climbed as much as 5.4% on Monday, as more analysts raised their price targets on the stock, a sign of growing optimism about the chipmaker’s highly anticipated results later this week. The average price target for the stock has been moving steadily higher recently, and is above $520, up from $505 just a week ago. The current target implies an upside of about 15% from current levels. Nvidia has risen 212% this year, compared with a gain of 39% for the Philadelphia Stock Exchange Semiconductor Index. Much of the rally reflects optimism over artificial intelligence, which Nvidia is a key player in. HSBC, KeyBanc Capital Markets, and BMO Capital Markets are among the latest firms to boost their targets ahead of the Aug. 23 release of Nvidia’s second-quarter results. The report is expected to show significant demand for the chips used to process AI services. Revenue is seen rising 65% from the year-ago period, according to data compiled by Bloomberg. This is one of the first reports by Nvidia where AI is expected to be the primary focus. Generative AI services like ChatGPT were thrust into the spotlight earlier this year and the excitement surrounding applications of artificial intelligence buoyed stocks like Nvidia. Last quarter, Nvidia gave a forecast that was far stronger than expected, cementing its status of a primary beneficiary of spending on AI. “Although market expectations have clearly risen for Nvidia and the overall AI supply chain, we expect bullish AI server momentum continued to surpass market expectations,” wrote HSBC analyst Frank Lee, who has a buy rating on the stock. KeyBanc Capital Markets, meanwhile, expects Nvidia’s results and outlook will be “meaningfully above” consensus expectations, given strong demand trends. Rosenblatt Securities, Piper Sandler, UBS, and Morgan Stanley have also lifted their targets recently. The overall consensus on Nvidia is extremely positive, as nearly 90% of the analysts tracked by Bloomberg recommend buying the stock." MY COMMENT Lets hope so.....even though "hope" is not a strategy.
This is not your Grandfather's computer chip. At $40,000 Nvidia chip has become the world's most sought-after hardware Companies and governments want to deploy generative AI—but first they need access to Nvidia's H100 chips https://qz.com/a-40-000-nvidia-chip-has-become-the-worlds-most-sought-1850746956 (BOLD is my opinion OR what i consider important content) "It seems like everyone wants to get their hands on Nvidia’s H100 chips these days. Microsoft and Google, which are building out generative AI-driven search engines, are some of the biggest customers of Nvidia’s H100 chips. Server manufacturersclaim to have waited more than six months to receive their latest orders. Venture capital investors are buying up H100 chips for the startups they invest in. But it’s not just tech companies in search of securing H100s: Saudi Arabia and the UAE have reportedly snapped up thousands of these $40,000 chips to build their own AI applications, according to the Financial Times, which cited unnamed sources. This steep demand for one chip from one company has led to something of a buying frenzy. “Who’s getting how many H100s and when is top gossip of the valley,” as OpenAI’s Andrej Karpathy put it in a Twitter post. Even Elon Musk, amid his obsession with fighting Mark Zuckerberg, found time to comment on the scarcity of Nvidia’s chips. (Musk does not identify whether he’s referring to H100 chips—which debuted last year—or Nvidia’s chips in general. But chips for AI are certainly all the rage at the moment.) Musk’s Tesla is spending $1 billion to build a new supercomputer named Dojo, to train its fleet of autonomous vehicles and process the data from them. The Dojo plan began, Musk said, only because Tesla didn’t have enoughNvidia GPUs—graphics processing units, as these chips are called. “Frankly...if they could deliver us enough GPUs, we might not need Dojo,” Musk told investors and analysts on a conference call in July. “They’ve got so many customers. They’ve been kind enough to, nonetheless, prioritize some of our GPU orders.” If Tesla had been able to receive the number of chips from Nvidia it required, those chips would have gone into specialized computers that would train the vast amount of video data, which, Musk says, is needed to achieve a “generalized solution for autonomy.” The data needs to be processed somehow. So Dojo is designed to be optimized for video training, not generative AI systems, to process the amount of data needed for self-driving vehicles, Musk said, which matters for achieving autonomous driving that is safer than human driving. Large language models (LLMs) are trained on massive amounts of data to generate complex responses to questions. But integrating LLMs into real-world applications like search engines requires a lot of computing power. In a study, researchers at the University of Washington and the University of Sydney broke down the high costs of running LLMs. Google processes over 99,000 search queries per second. If GPT-3 were to be embedded into every query, and assuming that each query generates 500 tokens, which are objects that represent the right to perform some operation, Google would need roughly 2.7 billion A100 GPUs—an older Nvidia AI chip—to keep up. The cost of these GPUs would exceed $40 billion in capital expenditures alone, the researchers estimated. What Google and other companies need is a more powerful chip that performs better at the same price or lower, said Willy Shih, a professor of management practice at Harvard Business School and who previously worked at IBM and Silicon Valley Graphics.Enter the Nvidia H100, named for computer scientist Grace Hopper. The H100 is tailored for generative AI and runs faster than previous models. The more powerful the chips, the faster you can process queries, Shih said. The demand for high-performing AI chips has been a boon for Nvidia, which commands the market—in part due to luck—as competitors scramble to catch up. As generative AI startups work on scaling up and find themselves running short of H100s, that presents opportunities for competitors—such as Amazon and Google, which are working on building their own Nvidia-like chips—to rise to the occasion. Amazon’s chips are called Inferentia and Tranium; Google’s are Tensor Processing Units. “It’s one thing to get access to infrastructure. But it’s another thing when, for example, you may want to scale the application, then you suddenly realize that you don’t have enough capacity that’s available,” said Arun Chandrasekaran, a Gartner analyst who focuses on the cloud and AI. “So I think it’s going to take some time for really these challenges to even out.”" MY COMMENT This is why I say this company might end up being like owning MSFT between 1990 and 2000 in the old days. This demand is in its infancy.......and......could easily last for a decade. This boom could also be a massive victory for owners of Google and Amazon as they rush to develop their own version of these chips.
A little analysis/opinion on China. China’s economy may never eclipse America’s https://finance.yahoo.com/news/chinas-economy-may-never-eclipse-americas-202222283.html (BOLD is my opinion OR what I consider important content) "In 1997, economists at the International Monetary Fund pointed out that China’s economy was growing so fast it might be bigger than the US economy by 2017. That didn’t happen. China’s economy did go gangbusters, however, and its population of more than 1 billion people seemed to assure it would eventually become the world’s biggest market. In 2010, Goldman Sachs estimated that China’s economy could overtake America’s as the world’s largest by 2030. The Economist was bolder, predicting China would become the world’s largest economy by 2019. The shift, whenever it came, would signal that a new economic superpower was ready to challenge US influence everywhere in the world. Now it looks like that day may never come. China’s economy has hit the skids in ways that suggest 25 years of supercharged growth may be ending, well before China achieves economic superpower status. China’s economy never powered out of the COVID pandemic the way the US economy did — and it’s barely growing now. Instead of marveling at China’s prosperity miracle, economists are now pondering whether China’s woes will bring down other parts of the global economy. Desmond Lachman of the American Enterprise Institute recently told Reuters that China’s economy is unlikely to eclipse the United States anytime within the next 20 years. Economist Paul Krugman, also a New York Times columnist, likens China to Japan in the early 1990s. That's when runaway growth came to a screeching halt and worries about an Asian nation’s world domination proved wildly unfounded. Japan, at least, had become a rich country by then. China still isn’t, and it may never join the ranks of so-called advanced economies. China faces many structural and cyclical problems, including a declining population, likely to make India the world’s most populous country sometime this year or next. China has relied far too heavily on debt-fueled real estate projects to power its growth, which has now produced an ongoing real estate collapse some liken to a “Lehman Brothers moment” for China. Meanwhile, the unemployment rate among 16-to-24-year-olds in China has officially risen from 11% in 2018 to 21% now. The real youth unemployment rate might be as high as 46%, according to the Eurasia Group. China’s communist government has stimulated the economy out of many slowdowns during the last 25 years, but recent efforts, including interest rate cuts and other measures, have underwhelmed investors and triggered stock sell-offs. The slowdown could be chronic. “Given how long we’ll be living with China’s economic struggles, investors will have plenty of time to get up to speed,” Capital Economics advised in an Aug. 21 report. China’s stagnation could have unexpected effects on global investors, American policymakers, and even US elections. When Donald Trump first ran for president in 2016, he complained that China was “eating our lunch,” citing record-high US trade deficits with China. As president, Trump imposed tariffs on hundreds of billions of dollars of Chinese exports to the United States, hoping to trigger more US manufacturing and cut US reliance on China. Trump’s trade war with China mostly raised costs on US importers — including consumers — while failing to accomplish its stated goals. Yet Joe Biden kept those tariffs in place after he became president in 2021. And Biden has gone further. New export controls ban the sale of certain US technologies to China, to inhibit production of advanced military weapons. Bills Biden signed to promote US manufacturing of semiconductors and green energy technology appear to be diverting some investment away from China back to the United States. And a burgeoning trilateral alliance between the United States, Japan, and South Korea is in part an economic bulwark against China’s heft in Asia. The trajectory of China’s economy is more than a chest-thumping contest. It matters because China under President Xi Jinping has increasingly become a militant threat to neighbors, including Taiwan, and an antagonist of Western democracies. In the early 2000s, shortly after China joined the World Trade Organization and began its export boom, many Western analysts assumed China’s communist government would become more democratic and friendlier as capitalism made it wealthier. But that hasn’t happened. Xi, for instance, regularly promises to “reunite” China with Taiwan by invading it. As a coalition of US-led nations sanction Russia over its barbaric war in Ukraine, China has become Russia’s most important ally. It doesn’t yet provide Russia desperately needed military gear, but it is now Russia’s biggest energy customer and it provides Russia many products difficult to get elsewhere because of sanctions. Politicians in both US political parties become have become aggressive China-bashers. Biden, running for reelection, has violated diplomatic protocol by calling Xi a “dictator.” Trump, the leading GOP contender in the 2024 race despite 91 criminal charges against him, has plans to limit US trade with China even more if he gets elected. Florida Gov. Ron DeSantis, running a far second in GOP polls behind Trump, recently unveiled an economic vision centered on further reducing China’s economic power. China isn’t fading into the sunset. It’s a nuclear power that will probably remain the world’s biggest manufacturer for a long time. If it wants to cause trouble, it will continue to have the means to do so. But China may also have as many gremlins in its own system as it has competitors on the world stage. The US economy, by contrast, remains dynamic and resilient. American dominance isn't over, yet." MY COMMENT Well we will see if a country that: Is the worlds most brutal communist dictatorship, with ZERO free markets or business, that steals all their tech and has outrageously undependable fraudulent data, no freedom, etc, etc, can beat.... The worlds leading free market capitalistic country, that is the world leader in technology and innovation, with a stable business environment and reliable markets, etc, etc. I guess in the end it will depend on US......and how long we can sustain what made this country great to begin with.
WXYZ: I apologize for being rude in your thread. We are good, RC. I feel I did not make my point as intended. Please allow me to take another shot. Scenario 1: Person A -> "The sun will not rise tomorrow because <blah blah blah>." Person B -> "There is no way you are correct. You are obviously clueless." Scenario 2: Person A -> "The sun will not rise tomorrow because <blah blah blah>." Person B -> "The sun will rise tomorrow because <blah blah blah>." One of these responses is an attack while the other expands the perspective of the group. I respect your opinion, RC. Elon has about the best history of success of anyone in business, including Jeff Bezos. Your perspective is probably correct and, by far, the safer bet. Please continue to share your view with us. When I bought my first tranche of Tesla shares in 2016, I was both cursed out and threatened with violence. I was told I should not be allowed to manage my own money. None of that was productive. I left that forum and came to Stockaholics. An objective investor will read the perspective of the lunatic and move on without derision because it is not possible to know who's view of the future turns out to be factual until the future arrives. Happy investing, RC. I wish you well in the markets and in life.
OK....you guys make up. A very minor event by internet message board standards. You are both important members and contributors to this thread and the board and always welcome to post. (not that I have any say over this thread, no one OWNS a thread)
W, while our points of view are not 100% identical, there massive overlap. I find myself either agreeing with what you write or not having a perspective on it. I literally don't recall having a position contrary to yours. Most people seek out an echo chamber where their opinion is reinforced but I'll take a spicey Cajun who challenges me over people who think like me. Echo chambers narrow the mind while contrary points of view expand it. In fact, I'm not sure this forum needs both of us. For what it's worth, I'm glad you're here and I appreciate the heavy lifting you do regarding the long term investor perspective. Thank you.
First time I wished I own one… damn, that would’ve been a long looooong hold. Good news is that I own 400k worth of comic books & Art with approx 60k invested and over 500k worth of sold collectibles in the past 11 years. Not bad (I think)
Thanks Tom, no hard feelings! You and W are the two posters I have learned the most from on here. There are others but you guys are the OG’s who’s threads I have followed for a number of years now. To be truthful your Tesla thread has been very monetarily beneficial for me hah, definitely helped reinforce my Tesla investments over the past four years. I honestly did not mean to insult you, maybe I have a bit too much confidence in Mr. Musk and it’s always good to constantly re-evaluate perspectives. If it was a joe blow poster I probably wouldn’t even had responded to your statement but when I saw you post i guess it hit harder, since you are the Tesla guru in here. I did sell 10% of my Tesla shares for the first time a week ago, the first time I’ve taken profits in a few years. I still believe in Elon, going to chalk up twitter to something a billionaire did as a one off for a number of reasons. I’d be lying if I said it doesn’t worry me that a Tesla old timer as yourself that got in at the earlier stages is now out, while I’m still in riding the wave....but I realize we are all at different stages and different situations for our investments and Tesla is still the golden goose in my stock portfolio. We’ll see what happens, really curious what kind of reception the cyber truck gets.
A few earnings this morning. LOWE'S REPORTS SECOND QUARTER 2023 SALES AND EARNINGS RESULTS (LOW) Medtronic reports first quarter fiscal 2024 financial results (MDT) Baidu Announces Second Quarter 2023 Results (BIDU) Coty Delivers Outstanding FY23 Results (COTY) DICK'S Sporting Goods Reports Second Quarter Results (DKS)
WELL......the rating agencies did their dirty little job and have now driven up the Ten Year Yield. It is currently at 3.432%. I have NO DOUBT that this little recent jump is a result of the publicity from the rating agencies. The FED should be thanking them. BUT.....this is a short term hike....it will moderate and I am guessing that the rates we are seeing now in the ten year......assuming no further FED hikes and no further BS from the rating agencies.....will turn out to be the short term peak. All of which....leads me to this little article. Weekly Market Pulse: Is The Correction Over? https://alhambrapartners.com/2023/08/21/weekly-market-pulse-is-the-correction-over/ (BOLD is my opinion OR what I consider important content) "Stocks are now down from their late July peak by about 5%. It has been a very orderly pullback with most of the major averages shaving off about the same amount. The exceptions are the NASDAQ, which peaked a little earlier than the S&P, and REITs, both down about 7.5%. The NASDAQ is more volatile than the S&P so it isn’t surprising it’s down more. It also isn’t surprising REITs are down more since the pullback was driven by higher interest rates. Small cap and foreign stocks are down a little over 6% which is, again, about what we’d expect from those indexes given a 5% pullback in the S&P 500. So, is that it? There’s no way to know for sure but sentiment has certainly turned more negative. Put/call ratios have risen with the equity-only ratio rising above 1 last week, a level usually associated with the bottom of corrections. The index level ratio isn’t in overly bearish territory yet but that doesn’t always happen in a short, sharp pullback. The percentage of stocks in the S&P 500 above their 200-day moving average has dropped to 54% which is right around the 50-week moving average for that statistic, a level we’ve visited repeatedly – and held – since the bear market low last October: This pullback/correction, like the bear market last year, was driven by higher rates, specifically real rates. TIPS yields are now above 2% for the 5-, 7-, and 30-year maturities and very close for the 10- and 20-year. Those levels are the highest since 2009 and are near “normal”. It was the period from mid-2011 to 2022, when the 10-year TIPS yield rarely poked its head above 1%, that was abnormal. The average real return of the 10-year Treasury note is 1.88% since 1928 and 2.63% since 1973. Real returns were a lot higher in the 80s and 90s but that was during a period when rates and inflation were falling rapidly; that isn’t where we are right now. So a 10-year, inflation-protected bond today gets you very close to the long-term average real return; normal in other words. I would also point out that the nominal 10-year Treasury note yield is pretty normal at these levels too. The geometric average return since 1973 is 4.34% (as of the end of 2022) and today’s yield is what you’d get for the next 10 years if you bought it today. So, a return of 4.25% over the next 10 years for owning a 10-year Treasury would be just about average for the last 50 years. Of course, averages often obscure as much as they reveal so I’m not saying the rate rise is over for sure. Average 10-year note nominal returns by decade have varied from 0.83% in the 1950s to 12.6% in the 1980s to 4.35% in the 2010s. The average return over the last 3 years is -3.64% and if we close down this year, it would be the third year in a row, something that has never happened. Expecting rates to keep rising for the rest of the year is arguing for an extreme. It could happen but I’m not sure I’d bet on it. So, have rates peaked? I don’t have a crystal ball but the market seems to be saying yes. The 10-year nominal yield is still in an uptrend but shorter maturities have stopped rising. The 2-year Treasury note yield has not moved up with the 10-year: That is an indication that the market believes the Fed’s rate hiking campaign is essentially over. Other markets, such as SOFR (short-term rate that replaced LIBOR) and Fed Funds agree. Expectations for the Fed Funds rate show it essentially unchanged until May of next year. Of course, the market could be wrong – the crowd may have wisdom but it isn’t infallible – so maybe this just means the Fed is behind the curve and will have to hike more. But for now, that is the best guess you are going to get. And if short rates have peaked it is likely that long rates have too. If that is true, what it means is that earnings are now the key metric for stock prices, not interest rates. And, as detailed below, quarterly earnings are already rising, up 15% since the low in Q2 last year. That is a key difference between this year’s rise in rates and last year’s. Last year, earnings were falling while rates were rising. This year rates have risen but only back to where they were last October while earnings are already higher and expected to rise more. BTW, it probably isn’t a coincidence that the market made its initial low at the end of last year’s second quarter when earnings hit their nadir or that stocks started to rise in October as Q3 operating earnings were being reported 7.4% higher than Q2. The reporting on earnings this quarter that I’ve seen has all shown a decline in earnings year-over-year. That’s the top line at the far right in the chart above that shows a decline of 5.5%. Think for a moment though about what that decline represents. It is the sum of Q3 ’22 + Q4 ’22 + Q1 ’23 + Q2 ’23 compared to Q3 ’21 + Q4 ’21 + Q1 ’22 + Q2 ’22. The year-ago figure includes earnings from Q3 and Q4 2021, the peak of the post-COVID earnings rebound. Those earnings were produced with near-record profit margins of over 13% (before wages really started to rise). Is it any wonder that earnings have declined from those levels now that margins are more normal (11.8% this quarter)? If you look at the quarter-by-quarter figures you get a much different picture. Operating earnings hit their low a year ago in Q2 while reported earnings bottomed in Q4. If earnings estimates are right for the next two quarters, the year-over-year change in Q4 reported earnings will be 32%. And, oh by the way, earnings estimates are still rising. If you’re waiting on earnings to bottom out, you already missed it. I don’t know what interest rates and earnings will do in the future. No one really does. But if rates have peaked and earnings haven’t, what do you think stock prices will do?" MY COMMENT I guess you could call this a MINI-CORRECTION or a HALF-CORRECTION. In reality it is not a correction at all. A correction is a drop of 10% or more. We are at about half that level right now. I do agree with some of the discussion above that it is likely that the FED is done with their hikes. I also agree that from this point on the PRIMARY driver of stocks and funds will be.....EARNINGS. In other words.....we have now gone past the pandemic distortions and the FED hikes to get back to a normal operating market for investors. That does not mean that stocks will simply go up. Even in a normal market there will be corrections and small and large black swans once in a while. I dont discount further action from the rating agencies. BUT......up or down.....it will be nice to be in a normal market after the past 3.5 years of INSANITY.
The open today reminds me of yesterday. Same feel and about the same reaction by the big averages over the first hour. NVDA pulled the markets up by their boot straps yesterday. I dont think we will see the same thing today by NVDA. I suspect the action in that stock will be more muted today as we are on the eve of earnings day. SO......we will just have to wait and see how today plays out.
Here is how we start the day. Stocks edge higher, 10-year yield sits near 16-year high https://finance.yahoo.com/news/stoc...r-high-stock-market-news-today-134055361.html (BOLD is my opinion OR what I consider important content) "US stocks opened higher on Tuesday as Treasury yields remained a key focus for investors with the 10-year yield sitting near 4.35%, a roughly 16-year high. Shortly after the opening bell, the S&P 500 (^GSPC) rose about 0.3% while the tech-heavy Nasdaq (^IXIC) led the morning gains, up roughly 0.5%. The Dow Jones Industrial Average (^DJI) traded near the flatline. On Monday, the tech-heavy Nasdaq Composite (^IXIC) rose 1.6% while the Dow lagged, a return of the trade that has dominated markets for much of the year but been absent during a sluggish month of August for equities. All eyes for investors remain on results from Nvidia (NVDA) set for release after the close on Wednesday and a speech from Fed Chair Jay Powell set for Friday morning. Early Tuesday, shares of Dick's Sporting Goods (DKS) were among the notable movers with the sporting goods retailer seeing shares fall more than 20% after a disappointing quarter." MY COMMENT NOTHING going on today......as we are in count-down mode for the NVDA earnings. Even the FED......hanging out with the ELITES in Jackson Hole.......is being ignored today for the most part. You know if the FED wanted to actually be part of the real world....they would be meeting in some ball-room.... in an airport Holiday Inn....in a representative American city.......with a typical hotel seminar chicken lunch served in the adjoining room next door at big round tables..
The SAD TALE for home buyers.....or make that potential home buyers.....continues. Home sales fall again in July, as supply drops to near quarter-century low https://www.cnbc.com/2023/08/22/home-sales-drop-again-in-july-as-supply-drops-again.html (BOLD is my opinion OR what I consider important content) "Key Points The median price of a home sold in July was $406,700, an increase of 1.9% from July of last year. Sales fell month-to-month in all regions except the West, where they gained 2.7%. Sales fell the most in the Northeast, down 5.9%. There were 1.11 million homes for sale at the end of July, 14.6% fewer than July 2022 and about half of the pre-Covid supply. Sales of previously owned homes dropped 2.2% in July from June to a seasonally-adjusted, annualized rate of 4.07 million units, according to the National Association of Realtors. Sales were 16.6% lower compared with July of last year. Homes sold at the slowest July pace since 2010. This count is for closings, so contracts were likely signed in May and June, when mortgage rates went from around 6.5% to well over 7%. Sales fell month-to-month in all regions except the West, where they rose 2.7%. Sales dropped the most in the Northeast, down 5.9%. The National Association of Realtors is blaming higher rates and still tight supply for the decrease. There were 1.11 million homes for sale at the end of July, 14.6% fewer than July 2022 and about half of the pre-Covid supply. At the current sales pace, that represents a 3.3-month supply. A 6-month supply is considered balanced between buyer and seller. Short supply continues to push both competition and prices higher. The median price of a home sold in July was $406,700, an increase of 1.9% from July of last year. “The West is the most expensive region, but it’s also the region that experienced some price decline,” said Lawrence Yun, chief economist for the National Association of Realtors. Prices in July rose in all regions year over year except in the West, where they were flat. Roughly three-quarters of the homes sold were on the market for less than a month, indicating still strong demand. About 30% sold for above list price. “Home shoppers have seen the number of options dwindle as homeowners are largely content to stay put and enjoy their current home, especially those with a low mortgage rate,” said Danielle Hale, chief economist at Realtor.com. Sales fell across all price categories, but they fell the least in the highest price category: homes over $1 million. That is because there is much more supply on the high end, while the low end of the market is leanest. Buyers continue to use cash to gain a competitive advantage. All-cash sales made up 26% of transactions, the share same as June but up from 24% in July 2022. Investors, who tend to use cash most, bought 16% of homes in July. It marked a decrease from 18% in June but was up from 14% in July 2022. First-time buyers appear to be gaining steam again. The Realtors reported 30% of sales going to these buyers, up from 27% in June. Demand for FHA loans is also increasing. These loans, which offer low down payments, are favored by first-time buyers. “The housing market is at a pivotal point as we head into fall,” said Lisa Sturtevant, chief economist at Bright MLS, noting higher mortgage rates in particular. “The decision between renting and buying will tip in favor of renting for some consumers, particularly in markets where rents are falling and new apartments are coming online.” MY COMMENT I dont see much change for the housing market any time soon. We are stuck in a rising market with NO inventory. I hear people talk about lower mortgage rates......but dont expect to see them in the 2-4% range......it is not normal and not going to happen.
