Financial News vs. Noise
I am traveling Tuesday and Wednesday, and probably Thursday, be back Friday
Two down days in a row and now below the 10 day. My sense is that there is a buying opportunity in here somewhere, just depends on your time frame. I’m currently long in my trend following model, my countertrend model, and it’s on watch to add if it moves down 2% or more today. Red again this morning.
The stock market is in its longest stretch without a 2% sell-off since the financial crisis-CNBC.com
The laggards continue to do better…
The question still is whether this rotation is now a two day wonder trade or the start of something bigger. My best guess is that you will see people buying the dip on the AI stuff. My watchlist coming into today includes AAPL, META, HPE, WDC, NVDA, MU, AVGO, and two industrial names that have AIness to them JCI and CARR. I will only be adding on dips. Friday is quarter end and PCE, we also have the Russell reconstitution. Interestingly, according to Mike O’Rourke the S&P 500’s P/E is now at a record 30% premium to the S&P 500 Equal Weight P/E. The prior high of 25% was during Covid. One would expect this to reverse.
Speaking of AAPL and META…
Meta and other companies developing generative AI are hoping to take advantage of Apple’s massive distribution through its iPhones—similar to what Apple offers with its App Store on the iPhone.
I think news like this could be huge. AI on it’s own is helpful, but my iPhone has my calendar, contacts, and all sorts of other stuff I use every day. AI integrated with that could be a game changer.
Of course don’t forget this issue….
AI IS ALREADY WREAKING HAVOC ON GLOBAL POWER SYSTEMS-Bloomberg
The rise of artificial intelligence is now turbocharging demand for bigger data centers, transforming the landscape even more and taxing the region’s energy grids.
If this is not just a two day wonder rotation, I trust the Dowish names more than small caps. You are seeing some interesting looking charts on some of the “stuff” stocks.
Maybe, at least until we see if they can break through the highs. Buy Freeport-McMoRan, Alcoa Stocks to Bet on Copper, Aluminum, Says Analyst-Barron’s
Not all though as coal, fertilizers, and lithium are all still getting crushed. Did pick up some ALB Friday.
And watching HCC today.
Just be careful, a lot of these ETFs suck. These Hot New Funds Are ‘Boomer Candy’ for Retirees-WSJ
The funds generate higher dividend income than is typical in a stock fund—sometimes 8% to 10%—but they also cap investor gains and carry chunky fees.
Among the other drawbacks: In most cases, the funds can be bought and sold any time but must be held for the full one-year outcome period to work as intended. An investor who sells early isn’t guaranteed full protection against losses and might miss out on some of the gains as well.
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Matthew Tuttle is the Chief Executive Officer and Chief Investment Officer of Tuttle Capital Management, LLC.
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