The Woke Street Journal
Market
I will be on a Twitter spaces with @Wolf_Financial this morning at 9:30am EST to talk about some of our new product filings.
Weaker than expected retail sales on Tuesday helped the bad news is good news narrative. This market continues to be about trend following on NVDA and select AI/tech stocks and counter trend moves on everything else.
‘Long Magnificent Seven’ is now one of the most crowded trades on record, new poll shows-MarketWatch
I do think this is different as you need Nvidia’s chips for AI. Nvidia’s Ascent to Most Valuable Company Has Echoes of Dot-Com Boom Chip maker passes Microsoft for top spot, just as John Chambers-led Cisco Systems did two decades ago. He says the situation now is different.-WSJ
Nvidia’s chips have been the workhorses of the AI boom, essential tools in the creation of sophisticated AI systems that have captured the public’s imagination with their ability to produce cogent text, images and audio with minimal prompting.
How long can this narrow leadership continue? That’s the million dollar question. At some point either the rest of the market joins in, or we get a correction in the AI stuff. Both of those things are going to happen, we just don’t know when or in what order.
Steve Cohen’s Point72 looks to raise $1 billion for new AI-focused fund: report-MarketWatch
Cohen, who owns the New York Mets baseball team, also said he believes markets are “discounting” the benefits of AI while dismissing the notion that the world is experience an AI bubble.
Rates also retraced the prior two days rise, which didn’t hurt equities.
We have talked about gold and the miners, GDX seems to have found some support at the 33 area. Some talk that JP Morgan upgrading South Africa could be a positive for gold miners as well. Then there is also this. Gold can help hedge inflation risks of Republican sweep, says Goldman Sachs-MarketWatch
Silver not quite as strong but could be looking to find some support here as well. My favorite silver miner to trade, PAAS, tried to pull an undercut and rally at the 50 day.
The Dow and small caps have now been up two days in a row. Not quite a trend yet, but a promising development nonetheless.
Regional banks had an undercut and rally at the 200 day. Not a fan longer term, but this could be a spot for a bounce.
Not quite sure what to make of this but suspect it will help regional banks stay volatile, which creates trading opportunities. Regional Banks Want to Slim Down. Hedge Funds Smell a Bargain. After failures, the lenders are paying fund managers to share risk-WSJ
Ohio-based Huntington Bancshares recently entered into an arrangement to sell investors some of the risk that its borrowers won’t repay their loans. That helps the bank meet new proposed standards meant to make lenders look healthy to regulators.
In EM, Mexico and Brazil have been brutal. Keep an eye out for potential bounces here, especially Mexico.
China looks to be finding some support.
I bought the dip in PDD Tuesday and will be looking for add spots today.
Aerospace and defense stocks (ITA) had an undercut and rally at the 50 day.
I bought LMT on Tuesday.
And right on cue, looks like another war. Israel and Hezbollah Inch Toward Wider War-WSJ
Oil stocks are trying to find some support. I already own XOP and XOM and added CVX on Tuesday. I also flipped short to long on OIH.
Solar’s look like they are also trying to bottom.
I did add FSLR the other day, a bit early
ESG
‘Weakened and Reshaped’: The State of Legislative Attacks on ESG More than 150 bills and resolutions have been proposed. Few are getting anywhere.-Institutional Investor
In 2024, legislators wrote 161 bills and resolutions in 28 states for consideration, a high volume and continuation of a trend in recent years. Out of those proposed, including 58 that carried over from the 2023 legislative session, only six bills passed in 2024 (each in a different state). Five of those six have become law; one is awaiting a governor’s signature.
The success rate is worsening. In 2023, 23 laws were passed and 6 resolutions resolved out of 198 total pieces of legislation.
DEI
Best Buy, J&J, Lazard Among Companies Downplaying DEI Executive Pay Goals-Bloomberg
A review of about 1,200 companies found that the proportion of corporations using a diversity, equity and inclusion metric to set compensation has dropped to 28% from closer to 33% in 2023, according to an analysis of regulatory filings by Farient Advisors. So far this year, 56 companies, including Best Buy Co., Chipotle Mexican Grill Inc. and Johnson & Johnson, removed or de-emphasized DEI when setting executive pay, the consulting firm said.
TUBERVILLE INTRODUCES BILL TO BOOST AMERICAN MANUFACTURING, REMOVE WOKE DEI REQUIREMENTS FROM CHIPS ACT-Tubberville.senate.gov
Today, U.S. Senator Tommy Tuberville (R-AL) and U.S Senator Mike Lee (R-UT) introduced the CHIPS Improvement Act—legislation that rights the wrongs of the CHIPS and Science Act (CHIPS). Signed into law in 2022, the CHIPS Act was intended to move the semiconductor manufacturing industry from China to America. Unfortunately, the final version of the CHIPS Act includes so much red tape, including DEI requirements and “environmental justice” initiatives, that companies are experiencing significant delays in the implementation of the law and in accessing its related funding opportunities. Senator Tuberville’s bill corrects the issue in two ways—by removing every unnecessary provision from the CHIPS Act that does not directly support domestic manufacturing and by removing woke criteria used to determine a company’s eligibility for the program.
GOP Bill Aims To Remove ‘Woke Regulations’ From CHIPS Act-Daily Wire
“The Biden administration has put American manufacturing, and the American worker, last on the world stage,” Tuberville said in a press release. “Our country simply cannot afford to allow China to continue to out-compete us in technology and innovation over the next generation.”
He added, “The CHIPS Act has potential, but it needs reforms to become effective. By removing the woke regulations that have nothing to do with job creation and are putting significant bureaucratic burdens on private industry, we can get government out of the way and allow this bill to do what it was designed to do: end American reliance on China.”
Republicans Should Get Behind Vance’s Anti-DEI Bill-National Review
The bill would bar school-accreditation agencies from requiring DEI in schools, and stop financial agencies like Nasdaq and the New York Stock Exchange from instituting diversity requirements for corporate boards.
The bill would also effectively rescind President Biden’s June 25, 2021, executive order, which pushed DEI requirements and ideas into “all parts of the Federal workforce.”
PricewaterhouseCoopers and JPMorgan Chase JPM 1.04%increase; green up pointing triangle are among those that recently removed or altered descriptions of their programs for underrepresented students. The shift came after an “anti-woke” movement took aim at U.S. companies and a Supreme Court decision overturned affirmative action in college admissions.
Woke
No, this is not from the Babylon Bee. Pilot’s Union Suggests Changing ‘Cockpit’ to ‘Flight Deck’ for Inclusivity-Breitbart
California Senate approves ban on requiring schools to notify parents of child’s pronoun change-Breitbart
Things That Get Blamed For Climate Change
I’m sure nothing can go wrong with this idea. These guys should just deface Stonehenge instead Wealthy Liberals Barrel Ahead With Plans To Block The Sun-Daily Caller
The initiative, which aims to lower global temperatures by making clouds brighter and thus better able to reflect sun rays, has faced hurdles as local officials in California are hesitant to allow scientists to spray the aerosols, such as liquefied salt, into the atmosphere. Nonetheless many of the program’s financial backers, including Hyatt Hotel heiress Rachel Pritzker, remain undeterred, according to Politico.
Will this apply to billionaires with private jets? European Commission To Consider Carbon Point System For Air Travel-Daily Caller
Under the scheme, carbon points would be allocated to citizens annually, with one point equal to one kilogram of carbon dioxide, the statement explained.
Fisker Group declared bankruptcy late Monday, the second U.S. electric-vehicle startup to fail in a year. Building a new car company isn’t easy, but Fisker ironically may have been harmed by President Biden’s force-fed EV transition.
Immigration
Cynicism thy name is immigration politics, and President Biden is proving it again with his Tuesday announcement that he’ll bestow legal status on the undocumented spouses and children of U.S. citizens. The order might be illegal, it could be reversed by a new President next year, and it will further poison the immigration debate. But, hey, any port in an election-year storm.
‘Unconstitutional’: Biden’s ‘Amnesty’ Executive Order Poised For Slew Of Legal Challenges -Daily Caller
But like DACA, the action is set to face legal challenges from conservative groups and immigration hawks, who say the executive order is unconstitutional and inappropriately interprets its underlying statute.
Covid
Really? Fauci Doubles Down On COVID Origins, Says Natural Occurrence ‘More Likely’ Than Lab Leak-Daily Caller
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