All posts by Greta Wall
David Prince Explains the Importance of Trading Beyond the Charts
Inner Circle’s David Prince uses a lot more than charts in his trading plan. He explains the other fundamentals he’s focused on when putting together a full picture for a trade: David covers: The importance of understanding the current market climate How to know how aggressive you can be What to do when the “wind is at your back” The mistake traders make with charts How to know when to size up or down Apply to join the Inner Circle VTF® and work with David here.
Continue Reading -->Amazon Saves the Bull Market + 9 Other Things You Need to Know
The Fed spooked the market this week about future rate cuts but big-tech earnings came in to save the day and keep the bulls running. Now it’s time to look ahead with the 10 things you need to know: 1. More Rate Cuts Aren’t Guaranteed Markets got the 25 basis point rate cut they were expecting from the Fed this week… but Chairman Jerome Powell quickly threw some cold water on future expectations. In his press conference, Powell said another cut in December is “not a foregone conclusion.” As of October 31, CME Group’s FedWatch Tool shows just under 65% of traders now expect a 25bp cut at the December meeting. 2. Amazon is the MAG7 Earnings Winner Amazon (AMZN) shares shot higher on Friday after beating Q3 expectations across the board Thursday. Here’s a look at how the company’s results compared to analysts’ estimates: Earnings per share: $1.95 vs. $1.57 estimated Revenue: $180.17 billion vs. $177.8 billion estimated Amazon Web Services Revenue: $33 billion vs. $32.42 billion expected Advertising Revenue: $17.7 billion vs. $17.34 billion expected In a statement, Amazon CEO Andy Jassy said that AWS is “growing at a pace we haven’t seen since 2022.” “We continue to see strong demand in AI and core infrastructure, and we’ve been focused on accelerating capacity — adding more than 3.8 gigawatts in the past 12 months” – Andy Jassy That seemed to temper market concerns about the company’s cloud business which have weighed on the stock this year. AMZN has been underperforming its MAG7 peers in 2025, up just 0.7% for the year as of Thursday’s close. 3. Is the AI Trade Unwinding? One reaction to this week’s big tech earnings seemed key to the future of the AI trade theme. Meta Platforms (META) tumbled as increased AI spending overshadowed strong Q3 results for the company. The social media giant hiked its capital expenditure guidance for 2025 to a range between $70 billion and $72 billion vs $66 billion to $72 billion previously. On the earnings call, CEO Mark Zuckerberg defended the massive spending. “It’s pretty early, but I think we’re seeing the returns in the core business. That’s giving us a lot of confidence that we should be investing a lot more, and we want to make sure that we’re not underinvesting.” -Zuckerberg This appears to be the first negative market reaction to big spending on AI… with companies previously being rewarded for such investments. But maybe that’s just a META thing… 4. Nvidia CEO: AI Is In A Virtuous Cycle Speaking at the APEC CEO Summit in South Korea on Friday, Nvidia (NVDA) CEO Jensen Huang said AI has reached a “virtuous cycle”. “The AIs get better. More people use it. More people use it, it makes more profit, creates more factories, which allows us to create even better AIs, which allows more people to use it. The virtual cycle of AI has been designed, and this is … the reason why you’re seeing the world’s capex going so fast.” -Jensen Huang Basically, demand creates more products, which creates more demand, and more products, and more demand, and more products, and so on. Take a listen to Jensen’s speech below: 5. More Important Earnings Are Ahead This will be another packed week of earnings reports. Highlights include: Monday PM: Palantir (PLTR), Hims and Hers (HIMS) Tuesday AM: Shopify (SHOP), Uber Technologies (UBER), Pfizer (PFE), Spotify (SPOT) Tuesday PM: Advanced Micro Devices (AMD), Super Micro Computer (SMCI), Astera Labs (ALAB), Pinterest (PINS) Wednesday AM: McDonald’s (MCD) Wednesday PM: Applovin (APP), Qualcomm (QCOM), Arm Holdings (ARM), Robinhood (HOOD), Doordash (DASH) Thursday PM: Airbnb (ABNB), Block (XYZ), Trade Desk (TTD), Affirm (AFRM) 6. It’s Jobs Week… With No Jobs Report The government is still shutdown, which means next week’s October nonfarm payrolls report won’t be released. The September JOLTS report scheduled for Tuesday also isn’t likely to be published. That puts all eyes on ADP’s Private Employment Report at 8:30am ET on Wednesday. For now that appears to be the only number the market will be getting to determine the health of the labor market. Here’s the full calendar for the week: 7. Trade Truce Between the U.S. and China President Donald Trump and Chinese President Xi Jinping came to a trade truce this week. The two leaders met at the ASEAN Summit in South Korea on Thursday. The agreement includes: A one-year pause of Beijing’s rare earth export controls The U.S. cut fentanyl tariffs on China to 10% from 20% China’s original announcement of rare earth export controls on October 9th sparked the latest round of the trade war with Trump threatening 100% tariffs. But China quickly came to the table for negotiations after that threat. Trump told reporters aboard Air Force One after his meeting with Xi that the rare earths agreement will be “very routinely extended as time goes by.” “We have a deal. Now, every year we’ll renegotiate the deal, but I think the deal will go on for a long time, long beyond the year. But all of the rare earth has been settled, and that’s for the world.” -Trump The lower fentanyl tariffs reduces the overall tariff rate on Chinese goods to around 47%. Trump said he will visit China in April and Xi will come to the U.S. at a later date. 8. Sentiment Turns Bullish The latest AAII Sentiment Survey shows that 44.0% of investors are bullish. That was up 7.2 points from the week before and higher than the historical average of 37.5% for the fifth time in the past seven weeks. 9. Netflix Announces Stock Split Netflix (NFLX) stock is about to become more accessible for the retail community. The company announced a 10-for-1 stock split after hours on Thursday. Netflix will issue 9 additional shares for every one share held on November 10. The stock will then begin trading on a split-adjusted basis at the market open on November 17. Netflix said the move will make its stock more accessible to employees participating in its stock option program. 10. David Prince Teaches You How Small Accounts Should Use Options David Prince, the leader of T3 Live’s Inner Circle VTF®, often uses options to add Alpha to a stock
Continue Reading -->9 Things You Need to Know: Inflation Is Back In Focus
We just wrapped up an exciting week that was all about the Fed. So what’s next for the market? This week we’ll be focused on inflation, the housing market, chipmakers, and more! Read on to find out what you should have your eyes on. 1. The Fed Still Cares About This Week’s Inflation Number Remember at Jackson Hole when Fed Chair Jerome Powell basically told the market they don’t care about inflation anymore and are instead focused on jobs? “The time has come for policy to adjust… The inflation and labor market data show an evolving situation. The upside risks to inflation have diminished. And the downside risks to employment have increased… We will do everything we can to support a strong labor market as we make further progress toward price stability.” -Jerome Powell, Jackson Hole 2025 Well that seemed to change at this week’s Fed meeting when the head of the Central Bank paired a dovish dot plot with hawkish language. The Fed cut rates by 25 basis points as expected on Wednesday with the dot plot showing two more cuts this year and one in 2026. But the Chairman called that move a “risk management cut” and said the Fed expects the impact of inflation on goods price “to continue to build” over the next year. So that means Friday’s PCE Price Index — which is the Fed’s preferred inflation gauge — means a little more to the market now than it would have before this Fed meeting. That number will be out at 8:30am ET on Friday morning and it could be a market mover if it comes in hot or cool. Plus, the week starts on Monday with a big group of Fed speakers including the Presidents of the New York Fed President, St. Louis Fed, Cleveland Fed, and Richmond Fed. 2. Key Housing Data Is On Deck Headed into this week’s Fed meeting, mortgage rates saw a massive drop with Mortgage News Daily showing the average 30-year rate hit a low of 6.13% on Tuesday ahead of the rate cut. But as the bond market rallied post-Fed, mortgage rates jumped alongside the 10-year Treasury yield. As of Friday, here’s a look at where rates stand: We’ll get some important data on the health of the U.S. housing market this week with two reports: August New Home Sales, 10:00am ET Wednesday August Existing Home Sales, 10:00am ET Thursday 3. Can Micron Keep Running? Micron Technology (MU) still hasn’t reported earnings… why do these chipmakers report so late? The company reports Fiscal Q4 earnings after the close on Tuesday and analysts love this stock: Expectations for this earnings report are: EPS: $2.86, +49.5% from last quarter Revenue: $11.13 billion, +19.6% from last quarter MU notched a fresh all-time high of $170.45 per share this week and is up over 30% from its last earnings report. So how good does that earnings report need to be? We’ll see on Tuesday. 4. Is Intel the next MP Materials? Nvidia (NVDA) announced a massive $5 billion investment in Intel (INTC) on Thursday. That deal comes after the U.S. government took a 10% stake in the chipmaker back in August. It’s all a little reminiscent of MP Materials (MP). In mid-July, the Department of Defense said it would invest $400 million in the rare-earth materials company and Apple (AAPL) announced a $500 million partnership with the company. Since then, the stock price has rocketed higher from around $30 to over $70 per share. INTC surged 22.8% on Thursday, the day the deal was announced, for its best daily performance in 38 years. Inner Circle’s David Prince discusses whether INTC is next in line for a massive move like MP: P.S. David is hosting a free webinar next week, sign up here for a special opportunity to join his elite community inside the Inner Circle VTF®. 5. Still Waiting on a TikTok Deal After a call on Friday, President Trump and Chinese President Xi Jinping still haven’t come to an agreement on a deal for the U.S. to take over TikTok. In a Truth Social post, Trump said it was a “very productive call”. In a follow-up post, the President also said he agreed to “go to China in the early part of next year” and that XI “would, likewise, come to the United States at an appropriate time.” Oracle (ORCL) is expected to be the biggest beneficiary of a TikTok deal after it was confirmed this week the company is part of the consortium of investors looking to take over the U.S. arm of the social media site. Oracle already hosts TikTok’s U.S. data and a new agreement could present additional revenue opportunities for the tech company like advertising revenue. 6. Quarterly Earnings Reports Could Go Away The SEC Chairman told CNBC on Friday the agency will propose a rule change to do away with quarterly earnings reports for publicly traded companies. This comes after President Trump called for the change in a post on Truth social earlier in the week. “In principle, I think to propose change in what our rules are now, I think would be a good way forward, and then we’ll consider that and move forward after that.. for the sake of shareholders and public companies, the market can decide what the proper cadence is.” -Paul Atkins, SEC Chair President Trump floated the idea of semi-annual reports saying such a move “will save money, and allow managers to focus on properly running their companies.” 7. iPhone 17 Global Sales Begin All eyes are on Apple (AAPL) as its newly announced iPhone 17 line hit store shelves globally on Friday. The company’s iPhone sales have been under pressure in recent years as it faces more and more competition – especially in China. But data from JD.com showed the first minute of iPhone 17 series preorders surpassed day-one order volume for the iPhone 16 series. That may be a good sign for the tech giant. Apple launched 4 phones in the 17 series: the iPhone 17, iPhone 17
Continue Reading -->10 Things You Need to Know: The Fed Heads to Jackson Hole
We just closed out another exciting week which saw: Conflicting inflation reports with a cool CPI and hot PPI CoreWeave (CRWV) report a wider loss than expected, crushing the stock Circle (CRCL) report a loss in its first post-IPO earnings report Warren Buffett bet big on a major U.S. healthcare provider A face-to-face meeting between President Trump and Russian President Putin And MORE! So it’s time for the 10 things you need to know right now. Starting with… 1. Traders Pare Rate Cut Bets – Fed Heads to Wyoming A 50 basis point rate cut was creeping up in conversation after the cooler-than-expected CPI report on Tuesday. But Thursday’s hot PPI put an end to that talk. Traders are still overwhelmingly betting the Fed’s first rate cut of the year will come at the September 17 meeting : The PPI signaled more tariff-related pain may be ahead for consumers as companies pass down rising costs to buyers. Fundstrat’s Tom Lee shook off the hot PPI on Thursday saying, “I don’t think that one data point is enough to change a thesis around the trajectory of inflation. Our base case remains that this is going to ultimately be viewed as transitory by the market.” We’ll get a clearer picture on the Fed’s outlook as the annual Jackson Hole Symposium begins on Thursday. This year’s theme is “Labor Markets in Transition: Demographics, Productivity, and Macroeconomic Policy.” Fed Chair Jerome Powell’s speech is slated for Friday, August 23. Coincidentally, the Fed cut rates for the first time in 4 years at its September 2024 meeting. And that was a 50 basis point cut. 2. Next Week’s Earnings Are All About Retail The retail sector is in focus for next week’s slate of earnings. Here’s the schedule: Tuesday AM: $HD Wednesday AM: $TJX $LOW $TGT Thursday AM: $WMT $BABA Friday AM: $BJ Analysts are loving Walmart (WMT) right now: That may just be the name to watch in this group next week. Friday’s retail sales report showed U.S. consumers are still spending. July retail sales rose 0.5% monthly, while retail sales excluding autos rose 0.3%. Both were in line with expectations. 3. Ethereum Inches Toward New All-Time High Ethereum crossed $4,700 early Thursday morning before pulling back and stalling. The previous all-time high is $4,868. Is a new record mark ahead? Tom Lee remains extremely bullish. In a note on Wednesday he wrote, “We have stated multiple times we believe Ethereum is the biggest macro trade over the next 10-15 years.” While Ethereum gets closer to its record high, Bitcoin notched a new one this week. Bitcoin rose to a high of $124,496 overnight on Wednesday before getting hit by the hotter-than-expected PPI Thursday morning. 4. Is The Next Big Crypto Play Bullish? New crypto exchange Bullish (BLSH) debuted on the NYSE Thursday at $90 per share, 143% higher than its IPO price of $37. The company is led by former New York Stock Exchange President Tom Farley and backed by Peter Thiel. Thiel also bet big on BMNR – buying a 9% stake in the company back in July – and we all know how that’s worked out since then. Here’s what the Bullish CEO had to say about their future: “The last leg of growth in crypto, the last 10 years, was basically all retail and … the institutional wave has begun. It’s here, and it’s a question of how big it will be. Based on the reception we’ve gotten thus far as part of our IPO, it feels like institutional investors feel like this could be the moment.” 5. Housing Market Updates Ahead It’s going to be a busy week for those focused on the housing market. We’ll kick things off Monday with the National Association of Homebuilders August sentiment index at 10:00am ET. Will the recent cooling of rates have builders feeling better about the future? The market will also get a look at how building is going with July Housing Starts and Building Permits out at 8:30am ET and then existing home sales on Thursday at 10:00am ET. In addition to all that data, homebuilder Toll Brothers (TOL) reports earnings after the market close on Tuesday, the first of the largest builders in the U.S. to report Q3 results. Of note, Berkshire Hathaway appears to believe in the future for homebuilders as they added Lennar (LEN) and D.R. Horton (DHI) to their portfolio this week. Speaking of… 6. Warren Buffett Bets Big on UNH Warren Buffett triggered a huge rally in UnitedHealth Group (UNH) on Friday after Berkshire Hathaway (BRK.A) revealed a $1.6 billion stake in the company in a regulatory filing Thursday. As of Thursday’s close, UNH was down nearly 122% from the April high: UNH is the largest private health insurer in the U.S. and has been under fire in the face of public scrutiny over the rising costs of health care. The company is even facing a DOJ investigation into its Medicare billing practices. So why would Berkshire buy the stock now? Buffett has a history of bargain investing and this appears to be the latest move in that direction. UNH is now the 18th largest position in the Berkshire portfolio. Other names added this week include Nucor (NUE), Lamar Advertising (LAMR), and Allegion (ALLE). 7. The Week Could Be Light Although we are getting data on the housing market and some key retail earnings, there aren’t any big market-moving numbers set to be released next week. Take a look at the full calendar: But one earnings name could be one to pay attention to… 8. Keep An Eye On PANW Earnings Palo Alto Networks (PANW) reports earnings after the market close on Monday. Software stocks have been beat up lately on fears of AI disrupting the space. The market expectations are: $2.50 billion in revenue, +9.31% from last quarter $0.89 EPS, +10/7% from last quarter And the overall consensus from analysts is positive on this name: PANW is down over 20% from its most recent post-earnings high of $210.39 on July 29. This earnings season, it’s been all about where a stock is
Continue Reading -->10 Things Traders Need to Know Next Week
It was a range-bound week in the market… but there was still some excitement including: The ongoing trade war with China The U.S. banning Nvidia (NVDA) from selling its chip in China Big bank earnings Mark Zuckerberg’s Meta Platforms (META) antitrust hearing UnitedHealth’s (UNH) plunge after earnings Eli Lilly’s (LLY) surge on trial success for its new weight loss pill So let’s dig in to the 10 Things You Need to Know Happening In The Markets Next Week 1. Will the U.S. make a deal with China? During a meeting with the Italian Prime Minister at the White House on Thursday, President Trump told reporters, “Nobody can compete with us…you will see we will make a very good deal with China.” President Trump on China: “Nobody can compete with us…you will see we will make a very good deal with China.” pic.twitter.com/XNjHSygUmj — Trump War Room (@TrumpWarRoom) April 17, 2025 So far, the trade war with China has been contentious with Beijing retaliating with its own tariffs. But the market seems to be less rattled by the tariff turmoil as time goes on. 2. Fed In Focus The Philadelphia Fed, Chicago Fed, and St Louis Fed Presidents are all scheduled to speak next week. Plus, Fed Governor Christopher Waller. The market is looking for more clarity on the Central Bank’s future plans after Chairman Jerome Powell signaled they are well positioned to wait and see the impact of tariffs before cutting rates. Powell said on Wednesday, “We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension.” President Trump meantime continues to demand rate cuts. In a post on Truth Social, he referred to the Chairman as “Too Late” Jerome Powell and seemed to hint he may be considering terminating him: Trump originally nominated Powell to the position on November 2, 2017 and his term is set to end in May 2026. The Fed also releases its Beige Book on Wednesday which gives the market a look at economic conditions across all 12 Fed districts. 3. Big Tech Earnings Are Starting Earnings will pick up steam next week with some big tech names in the mix. The question for the market remains centered around future outlook and how many companies will pull their guidance due to tariff uncertainty. Taiwan Semiconductor (TSM) maintained its full-year outlook on Thursday after beating Q1 expectations on the top and bottom line. Here’s what names to have on your radar next week: Tuesday: 3M (MMM), Tesla (TSLA) Wednesday: Boeing (BA), Lam Research (LRCX), IBM (IBM), Chipotle Mexican Grill (CMG) Thursday: Alphabet (GOOGL), Intel (INTC) How will these names move? Well, it all depends how the stock is trading headed into the report. 4. Is The Bond Market Back to “Normal”? Action in the U.S. bond market seemed to be much healthier last week after talk that something was “broken” in the week before. Is the sell-off of U.S. Treasuries over? Only time will tell. For now, the 10-year yield is hovering around 4.3% after falling as low as 3.9% at the start of the tariff drama. 5. Is The Housing Market Stalled? We will get updated data on the housing market next week with New Home Sales and Building Permits on Wednesday and Existing Home Sales on Thursday. The recent volatility in the Treasury market has directly impacted mortgage rates as they follow the 10-year Treasury yield. As of Thursday morning, Mortgage News Daily showed the average 30-year fixed mortgage rate just under 6.9%. The Mortgage Bankers Association reported an 8.5% drop in total mortgage application volume last week as rates spiked from 6.61%. That drop came even as active inventory increased by 30%, a bad sign for sellers. MBA said more buyers are opting for riskier adjustable-rate mortgages, with the ARM share of mortgages at 9.6% — the highest since November 2023. 6. Gold Takes A Breather… After Hitting New Record Gold prices continued to spike last week, hitting another fresh record high of $3,357.57 on Wednesday. But on Thursday prices pulled back as investors appeared to book profits ahead of the long weekend. It’s hard in this market to hold anything over a long weekend, knowing the President could announce progress on trade talks or even a new trade deal at any moment. Other metals also pulled back on Thursday including Silver, platinum, and palladium. 7. Consumer Sentiment Update The University of Michigan releases its final Consumer Sentiment Survey for April on Friday. That reading is expected to be unchanged from 50.8 originally. That’s the lowest level for the index since June 24, 2022. The market — and the Fed — are focused on consumers’ inflation expectations with the new tariffs. 8. The VIX Has Pulled Way Back The VIX has dropped below 30 after peaking above 60 on April 8… does that mean the bottom is already in? The market was very boring at times for active traders last week due to the lack of volatility. Treasury Secretary Scott Bessent told Bloomberg, “If we measure uncertainty by the VIX… I think the VIX spiked and has likely peaked.” Will volatility pick back up with earnings this week and the possibility of new trade deals? CNN’s Fear & Greed Index still shows Extreme Fear driving the market now: 9. Will XBI Continue to Outperform? Biotechs outperformed other major sectors in the market over the past week. Since April 10, XBI is up 6.08% while XLE is up 5.86%, XLF is only up 1.64%, and SMH is down 1.84%. Will that strength continue next week? 10. Is Palantir Set to Breakout Many traders are focused on Palantir (PLTR) for a breakout play. The stock closed just under $94 on Thursday. Is this at a discount here? PLTR has been outperforming the entire MAG7 group, despite being overvalued on a forward P/E basis. This name seems to bucking the “revaluation of stocks” thesis that’s going around. Have a great long weekend! P.S. Want to learn how to trade with X-Ray Vision? Check out JR’s Romero’s Tape Reading Course. It’s LIVE this weekend!
Continue Reading -->Alpha In This Market Is Under The Hood
David Prince says “there’s a lot of alpha under the hood” in this market. That means he’s trading less MAG7 names and focusing on themes. Two big themes lately have been FinTech, with stocks like Affirm (AFRM) and Upstart (UPST), and Chinese names like Alibaba (BABA). David joined an X Space with other traders to discuss the current market and what he’s doing, his comments start at 26:00 in: https://t.co/xPKRJDJhEU — Jake Wujastyk (@Jake__Wujastyk) October 15, 2024 He also discusses: Why he doesn’t subscribe to “black swan” events How he’s sizing big on good opportunities Expectations for XBI and IWM into the end of the year Want to trade with David? Apply to join the Inner Circle now!
Continue Reading -->Bank Earnings Prep
Second quarter earnings season is ramping up starting Friday. Some of the biggest banks in the U.S. are reporting before the market open: JPMorgan Chase (JPM) Wells Fargo (WFC) Citigroup (C) Here’s a look at how the stocks are looking heading into these reports and the consensus estimates for results. JPMorgan Chase (JPM) Expectations Adjusted Revenue: $46.66 billion Adjusted EPS: $4.51 Wells Fargo (WFC) Expectations Adjusted Revenue: $20.23 billion Adjusted EPS: $1.28 Citigroup (C) Expectations Adjusted Revenue: $20.09 billion Adjusted EPS: $1.39 And the earnings action will continue with more banks next week! Goldman Sachs (GS), Bank of America (BAC), and Morgan Stanley (MS) are all set to report. There are several key questions for analysts when its comes to banks this earnings season. How are deposits faring? How is commercial lending holding up in the high rate environment? And, for the investment banks, are trading profits still at record highs? We’ll get those answers and more starting Friday morning!
Continue Reading -->Coffee With Greta: Hot Labor Market
Editor’s Note: Coffee With Greta will be on pause until mid-July as Greta takes maternity leave to bond with her new baby. DJIA Futures: +148 (+0.4%) SPX Futures: +26 (+0.5%) NASDAQ Futures: +103 (+0.6%) Good morning friends! Futures are holding onto gains despite the release of a hotter-than-expected jobs report. Let’s get right to it! Hot Job Growth The U.S. labor market is still running hot. The Labor Department reported the economy added 303,000 jobs in March vs 200,000 expected. But looking deeper into the report, the rest of the numbers are mostly in line with expectations. The unemployment rate dipped as expected to 3.8% from 3.9% from previously. Average hourly earnings, which are in focus as the Fed looks for signs of cooling inflation, rose 4.1% year over year. That was down from 4.3% in February and in line with estimates. The labor force participation rate rose to 62.7% from 62.5% in February vs 62.6% expected. February’s job growth was revised lower by 5,000 to 270,000 while January was revised higher by 27,000 to 256,000. Yields Pop Treasury yields are popping this morning after the release of that jobs data. The 10-year yield is up seven basis points to 4.39% while the 2-year yield is six basis points higher at 4.72%. CME Group’s FedWatch Tool shows traders starting to dial back rate cut expectations. Just 50.7% now say they expect the first cut at the June meeting, down from over 70% last week. Kashkari Spooks Market On Rates Minneapolis Fed President Neel Kashkari spooked markets on Thursday with comments about zero rate cuts in 2024. During an interview, Kashkari said, “If we continue to see inflation moving sideways, then that would make me question whether we need to do those rate cuts at all.” His comments come after several other Fed officials, including Chairman Jerome Powell, spoke this week and said more evidence is needed on cooling inflation. The next piece of important data after today’s jobs report will be the March CPI and PPI next week.
Continue Reading -->Coffee With Greta: Waiting For The Jobs Report
DJIA Futures: +189 (+0.5%) SPX Futures: +32 (+0.6%) NASDAQ Futures: +153 (+0.8%) Good morning friends! Futures are higher as traders await Friday’s jobs report. Let’s get right to it! Weekly Jobless Claims Climb Weekly jobless claims rose more than expected last week. The Labor Department reported 221,000 Americans filed initial claims for unemployment benefits. That was up by 9,000 from the week before and the highest total in nine weeks. Economists expected claims to rise to 213,000. Continuing jobless claims dropped by 19,000 to 1.79 million in the week ending March 23. Powell Emphasizes Need For More Data On Inflation Fed Chair Jerome Powell says the Central Bank is in no rush to start cutting interest rates. Speaking at Stanford University on Wednesday, Powell said, “On inflation, it is too soon to say whether the recent readings represent more than just a bump.” He said officials still need more data of inflation cooling in order to start cuts. Powell said, “We do not expect that it will be appropriate to lower our policy rate until we have greater confidence that inflation is moving sustainably down toward 2 percent. Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy.” His comments came hours after Atlanta Fed President Raphael Bostic told CNBC he only expects one rate cut in 2024, in the fourth quarter. CME Group’s FedWatch Tool shows 61.5% of traders still anticipating the first rate cute at the Fed’s June meeting. Levi Rises On Strong Fiscal Q1 Levi Strauss (LEVI) shares are rallying 13.3% ahead of the open after beating fiscal Q1 expectations on the top and bottom line. Here’s how the denim company’s results compared to analysts’ estimates: Adjusted EPS: $0.26 vs $0.21 expected Revenue: $1.56 billion vs $1.55 billion expected Sales were down about 8% year over year, primarily due to a shift away from wholesale orders to retailers. Direct-to-consumer sales made up 48% of Levi’s overall sales, up from 42% a year ago and 25% two years ago. The company forecast full-year sales will rise between 1% and 3% with adjusted EPS between $1.17 and $1.27. Analysts were anticipating 2.4% full-year sales growth and EPS of $1.21. In Case You Missed It Growth in the U.S. services sector slowed in March. The Institute for Supply Management’s services PMI fell to 51.4% last month from 52.6% in February. That was lower than expectations for an increase to 52.7%. The business activity index rose 0.2% to 57.4%, new orders fell 1.7% to 54.4%, and the employment index rose 0.5% to 48.5%.
Continue Reading -->Coffee With Greta: Strong Labor Market
DJIA Futures: -33 (-0.1%) SPX Futures: -9 (-0.2%) NASDAQ Futures: -56 (-0.3%) Good morning friends! Futures are falling after the release of strong jobs data. Let’s get right to it! Strong Private Job Growth The U.S. private sector added more jobs than expected in March. Payroll firm ADP reported private employers hired 184,000 workers last month vs 155,000 expected. That was the fastest pace of growth since July 2023. Wages also rose 5.1% year over year, the same rate as February. ADP’s chief economist said, “March was surprising not just for the pay gains, but the sectors that recorded them. Inflation has been cooling, but our data shows pay is heating up in both goods and services.” The leisure and hospitality sector led job gains last month, adding 63,000 workers. Construction added 33,000, trade, transportation, and utilities added 29,000, education and health services added 17,000, while professional and business services lost 8,000. This data comes ahead of the official March jobs report on Friday which is expected to show growth slowed to 200,000 jobs with the unemployment rate ticking lower to 3.8%. Yields Jump After Jobs Data Treasury yields are pushing higher this morning after the release of that hotter than expected jobs data. The 10-year yield is up four basis points at 4.40% while the 2-year yield is up three basis points at 4.74%. Continued strength in the labor market is not a good sign for traders who are hoping for three rate cuts in 2024. Fed Speakers Dampen Rate Cut Hopes Atlanta Fed President Raphael Bostic does not see any cuts happening this year until Q4. Speaking this morning, Bostic expressed concern about the continued pace of inflation and said he only anticipates one cut instead of three. This comes after several Fed officials have spoken so far this week. Cleveland Fed President Loretta Mester said on Tuesday that she still expects cuts this year but ruled out the first coming in May. Mester said, “I continue to think that the most likely scenario is that inflation will continue on its downward trajectory to 2 percent over time. But I need to see more data to raise my confidence.” She indicated the long-run path of inflation is higher than officials had previously thought. San Francisco Fed President Mary Daly echoed that need for more convincing data that inflation has been subdued. Daly said, “Three rate cuts is a projection, and a projection is not a promise. We’re getting there, but it’s not going to be tomorrow, but it’s not going to be forever.” Bostic, Mester, and Daly are all voting members of the Federal Open Market Committee this year. In Case You Missed It Tesla (TSLA) shares dropped 4.9% on Tuesday after reporting disappointing Q1 delivery numbers. The electric automaker delivered just 386,810 vehicles in the first quarter and produced 433,371. Production was down 1.7% year over year while deliveries tumbled 8.5%. Deliveries were well below consensus estimates for around 457,000 vehicles.
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