The Woke Street Journal
Market
Market started off strong on Friday only to selloff into the close. The Magnificent 7 was down across the board, except TSLA which was up slightly. Speaking of TSLA, if you are into breakouts it looks interesting, especially if it can clear it’s 200 day.
In AI, NVDA is down again this morning and it looks like it is going to open below it’s 20 day EMA. Be interesting to see if the other AI names can move higher without them joining in. Speaking of AI, keep an eye on this. Larry Connors puts out a great AI report every week, and on Sunday he talked about nuclear. Always one to be ahead of the curve on this stuff. Tech Industry Wants to Lock Up Nuclear Power for AI-WSJ
Tech companies scouring the country for electricity supplies have zeroed in on a key target: America’s nuclear-power plants.
The owners of roughly a third of U.S. nuclear-power plants are in talks with tech companies to provide electricity to new data centers needed to meet the demands of an artificial-intelligence boom.
Among them, Amazon Web Services is nearing a deal for electricity supplied directly from a nuclear plant on the East Coast with Constellation Energy CEG -2.20%decrease; red down pointing triangle, the largest owner of U.S. nuclear-power plants, according to people familiar with the matter.
I bought the dip in CEG on Friday, a bit too early, and am looking to add on any dips.
The forecast demand from data centers and electric vehicles alone through 2030 is equivalent to the entire electric demand of Turkey.
Speaking of NVDA. No Nvidia in Your Portfolio? ‘You’re Just Toast’ The average stock in the S&P 500 is lagging behind the index by most since at least 1990-WSJ
Much of the rest of the index has languished. The average stock within the S&P 500 is up 4.1% this year, while the broad index is up 14.5%. That is the largest underperformance since at least 1990, according to Dow Jones Market Data. Six of the 11 sectors in the index declined in the second quarter, including financials, energy and industrials.
In tech, strength has shifted towards software as the semi’s have cooled off.
ABDE especially. After getting crushed on earnings and being left for dead it’s come back with a vengeance. My overreaction model actually went short on Friday, but if I was trading this on a discretionary basis would be using the 200 day as a sign one way or the other.
Microsoft and 3 More Stocks to Play a Software Rebound-Barron’s
Other strategists similarly think investors shouldn’t avoid software: Earlier this week 22V Research argued much the same, and at the start of the month Capital Economics argued that the preference for semiconductor stocks likely wouldn’t last forever.
With the first half of the year drawing to a close, AI momentum looks likely to keep driving the market’s direction, and potentially begin to bring software along for the ride once more.
The Mag 7 Trade Is Aging. Software Is New Again.-Barron’s
That’s a sign that market sentiment toward software may have started to shift, especially as investors begin to identify companies that can benefit from AI, including Adobe, Salesforce, and ServiceNow. “We think the inflection for software stocks is more than just a short-term sentiment swing,” Cossel writes.
Some other previously lagging areas are looking strong. Regional banks…
Transports
Is this the start of a broadening out? Of did these areas just get beaten up so much they were due? Doubt we get any real answers in a holiday shortened week.
Speaking of broadening out, this from BTIG….
The equal-weight S&P 500 (SPW) has underperformed the SPX by nearly 10% over the first six months, one of the worst such stretches on record back to 1990 and by far the worst 'first six months' of the year. If small-caps are going to work, we think they have to start soon or they become the 'canary in the coalmine' rather than a rotation opportunity. At this point small-cap growth (IWO) looks better than value, but it's still in a 'show me' state.
Don’t forget about GEO. ‘Trump’ Stocks Are Rising: Banks, Managed Care, Steel-Barron’s
Nothing that interesting on my watchlist today. Looking to possibly add to MU and CEG on further dips. On the short side I have ADSK.
Of course these will expand. You can go completely broke, but only if you are a moron and you put all your money into one of these things. These are a tool, just like any other tool. The fact that they come out every day offers some strategies that you can’t do with other tools. Wall Street’s Hottest Lottery Ticket: Zero-Dated Options Bets on market moves have taken off with these options. Stocks like Nvidia and Apple could be next.-Barron’s
Hate to break it to you, but whether Trump wins or not, Social Security and Medicare are in trouble. You should be saving anyway. Opinion: Another Trump presidency spells trouble for Social Security and Medicare. Start saving now.-MarketWatch
Biden
My sense is that this was a carefully choreographed Plan A and Plan B. Plan A is you get State of the Union Joe and push him over the finish line. Plan B is you get senile Joe, the donors revolt and there is plenty of time to replace him. Obama’s tweet, and when it came out, in the afternoon the day after, seems to imply that they are not replacing Joe.
But, real interesting take here. Instead of the shock and surprise they were showing, perhaps they were playing chess while Trump is playing checkers?
Yet they had already become increasingly apparent in Washington’s corridors of power and across the world for months. In interviews, top officials abroad and Democrats said they have witnessed other moments when Biden’s behavior concerned them. Some were quickly relieved when Biden appeared to regain his footing. Others were left shaken by the experiences.
The main stream media narrative around the debate was that everything Trump said was a lie, but what if he wasn’t lying about Iran? How Iran Defied the U.S. to Become an International Power Despite decades of Western pressure, Tehran poses a greater threat to U.S. interests thanks to its ties to Russia and China-WSJ
Today, Tehran poses a greater threat to American allies and interests in the Middle East than at any point since the Islamic Republic was founded in 1979.
Did they pose the same threat four years ago?
Speaking of lies. EXCLUSIVE: Gold Star Mother Calls For Leadership ‘Change’ After Biden Falsely Claimed No Troops Died Under His Watch-Daily Caller
Biden falsely claimed during a debate against former President Donald Trump on Thursday that he was “the only president in a century” who has not had any U.S. troops die or get killed anywhere in the world during his tenure. Alicia Lopez, mother of Cpl. Hunter Lopez — one of the 13 servicemembers who was killed during the botched Afghanistan withdrawal in 2021 — told the Daily Caller News Foundation that Biden’s comments were “sad” and said it was “time for a change” in White House leadership.
Finally this, looks like he’s staying. After all, who is going to pardon Hunter? Biden’s Family Urges Him To Stay In 2024 Race After Fumbling Debate: Report-Daily Wire
ESG
BlackRock throws support behind effort to move pensions beyond ESG-Financial Times
BlackRock has thrown its weight behind a coalition of US police and firefighter labour groups that is making the case for getting politics out of pensions, in its latest effort to navigate the backlash to environmental, social and governance investing. The world’s largest money manager is the only financial group among the founding members of the Alliance for Prosperity and a Secure Retirement, a Delaware-registered non-profit that warns on its website that “politics has no place in Americans’ investment decisions”. After coming under fire over its advocacy for sustainable investing, BlackRock has increasingly highlighted the primacy of investor choice.
Not dead yet. BlackRock launches five climate transition ETFs in Europe-Financial Times
The List of Money Managers Axing Oil Stocks Just Got Longer-Bloomberg
There’s a growing list of institutional investors in Europe who are stripping oil and gas stocks out of their portfolios, in a move they say reduces the risk of ending up with stranded assets and financial losses.
The latest to do so is PFA, Denmark’s largest commercial pension fund with roughly $110 billion of assets under management. The investor has just offloaded its $170 million stake in Shell Plc based on an assessment that the company’s capital expenditure on renewables is worryingly low.
But with the demand for power that AI is going to need the utilities are where you want to be. Climate Fund Seeks To Satisfy Investors Frustrated By ESG Funds-Forbes
The Sphere 500 Climate Fund (SPFFX) seeks to decarbonize the benchmark by providing a fossil-free portfolio for people who don’t want to invest in companies helping to destroy the environment or adding to global warming. The fund takes the S&P 500 and removes all energy and utility stocks.
DEI
Three weeks later, Tractor Supply delivered its decision: Diversity, equity and inclusion at the rural chain were over, including related job roles, and so were some of its environmental initiatives and other causes frequently championed by social progressives.
Starbuck, in an interview, said “we definitely proved a model” of blitzing a company with a primarily conservative customer base. He intends to target other companies soon, he said.
Since 2015, the approach has been tested in the fire of the marketplace and failed. Academics have tried to repeat McKinsey’s findings and failed, concluding that there is in fact no link between profitability and executive diversity. And the methodology of McKinsey’s early studies, which helped create the widespread belief that diversity is good for profits, is being questioned.
The ultimate DEI hire. The Mess Democrats Have Made, Kamala Harris Edition Imagine if Biden had chosen a Vice President for competence rather than identity politics.-WSJ
The path out of this nightmare might be easier if not for another problem the press refused to recognize—that Kamala Harris wasn’t remotely qualified to be Vice President when Mr. Biden chose her. He had promised to pick a woman as his Vice President, and Mr. Biden selected Ms. Harris because she was a woman of color, not because of her qualifications.
How DEI is coming for lawyers-NY Post
In April, for example, the New York City Bar Association (NYCBA) presented me with an intellectually painful opportunity to earn the diversity credit required to keep my license. The class focused on “inclusive language,” enumerating the terms and words that the NYCBA now believes to be unacceptably “offensive.” What do these include?
Referencing the “criminal justice system” is now verboten because there’s not enough justice in the system. Don’t cite a “white paper,” because you’re implying that valuable things must be white. Also, instructed the training, “low hanging fruit” is now an inappropriate phrase (for reasons left dangling).
Things That Get Blamed For Climate Change
Pollution Curbs, Non-Compete Bans at Risk by Chevron Ruling-Bloomberg
The Supreme Court’s decision to undercut the ability of administrative agencies to interpret vague laws casts a long shadow over federal auto emission limits, bans on non-compete agreements and efforts to regulate broadband internet.
The 6-3 ruling Friday overturning the so-called Chevron doctrine could have its biggest impacts on environmental, tech and health policy, where partisan gridlock has stymied lawmaking by Congress, forcing federal agencies to use old statutes to regulate newer problems such as climate change.
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