Morning News: March 21, 2024
Posted by Eddy Elfenbein on March 21st, 2024 at 7:03 am

Why the Panama Canal Didn’t Lose Money When Ship Crossings Fell

Why the Yen Is So Weak and What That Means for Japan

Biggest Kenyan Bank’s Bid to Fix Bad Debts Hit by State, Courts

Switzerland Surprises With Rate Cut, Moving Ahead of ECB and Fed

Julius Baer Hits Reboot to Escape Swiss Banking’s New Malaise

Swatch CEO Says ‘It’s a Pity’ SNB Didn’t Cut Rates Sooner

Bank of England Holds Key Rate Steady at 5.25%

The Fed’s Conundrum: Interest Rates Are Both Too High—and Too Low

U.S. Debt Races Toward Record This Decade, C.B.O. Warns

Fidelity’s Abby Johnson Tightens Grip on Far-Flung Family Empire

Barclays Readies Hundreds of Job Cuts in Investment Bank

Wall Street’s Biggest Names Share March Madness Tips

Why Texas Is Banning Banks Over Their ESG Policies

Wall Street and Silicon Valley Elites Are Warming Up to Trump

Apple CEO Opens New Shanghai Store in Show of China Commitment

Seven Things to Know About Reddit’s Unusual IPO

Is Microsoft Building an Unassailable Lead in A.I.?

Cash-Rich Cisco Shifts to Net Debt Position for Growth, Returns

GE Bet on Being the Biggest, Then It Had to Break Up to Keep Up

Airline CEOs Seek Meeting With Boeing Directors to Address Production Problems

Biden Approves $5.8 Billion in Additional Student Debt Cancellation

What Comes Next for the Housing Market?

Biden Suggests a Bigger Federal Role to Reduce Housing Costs

Weight-Loss-Drug Users Pay Up for Help Ditching the Pricey Meds

Target Is Doubling Its Employee Bonuses This Year

Build-A-Bear’s Shipping Expenses Pushed Up By Red Sea Attacks. Will Stuffed Bears Cost More?

A Japanese Startup Is Shipping $89 Strawberries, $120 Melons

The First Name in Ranch Dressing Is Coming for Breakfast

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Morning News: March 20, 2024
Posted by Eddy Elfenbein on March 20th, 2024 at 7:04 am

Fitch Upgrades Qatar to Third-Highest Rating on Gas Investments

How the BOJ’s Plan for a Smooth Exit from Negative Rates Unraveled

ECB Could Cut Rates in June if Inflation Continues Easing, Lagarde Says

Indonesia’s Central Bank Stands Pat as Expected, Fed Decision Looms

Inflation Fears Bloom for the Fed’s Rite of Spring

Fed to Give Fresh Clues on Path of Interest-Rate Cuts

US Crypto Firms Paying $300,000 Wages Leave Foreign Peers Behind

Finma Plans Stress Tests at UBS After Scrutiny on Lender Rises

BlackRock Ditched by Texas Fund Shows Limits of Fink Persuasion

Tech Giant Linked to France’s Cybersecurity Tumbles in Value

Google Fined Roughly $270 Million in France Over Dispute With News Publishers

Apple Keeps Losing Patent Cases. Its Solution: Rewrite the Rules

US Weighs Sanctioning Huawei’s Secretive Chinese Chip Network

Intel Gets $20 Billion in US Grants, Loans for Chip Plants

The Global Effort to Make an American Microchip

Hiring Booms at SpaceX and Blue Origin Making It Hard for NASA to Attract Talent

Boeing Sees Massive Cash Drain as 737 Max Episode Takes Toll

Nikola’s Rollout of Hydrogen Trucks Is Hitting Supply-Chain Hurdles

China’s MG Motor Venture Bringing Electric Sports Car to India

Why Mainland Chinese Flocked to Hong Kong’s New Global Visa

Lonza to Buy U.S. Manufacturing Facility From Roche For $1.2 Billion

HP Is Turning Printers Into a Subscription

To Catch Retail Thieves, This Unlikely Duo Treats Them Like the Mob

Luxury Stocks Fall After Gucci Owner Kering Warns of Sales Drop

Shohei Ohtani, the Dodgers’ $700 Million Man, Will Transform Baseball—If He Wants To

For Women’s Basketball, Caitlin Clark’s Lasting Impact May Be Economic

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CWS Market Review – March 19, 2024
Posted by Eddy Elfenbein on March 19th, 2024 at 8:57 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

Why You’re Not Diversified When You Think You Are

One of the themes I stress to investors, especially newer investors, is the importance of owning a diversified portfolio. So often, I’ll hear investors say, “sure I’m diversified! I own AMD and TSM.” Well, that’s not exactly proper diversification. Owning two stocks that closely mimic each other does little to lower your risk.

Diversification is an important topic and it’s more difficult than it may appear. By not being properly diversified, investors can leave themselves exposed to risks they’re unaware of.

For example, an investor may load up on several stocks that are highly sensitive to the U.S. dollar. When adding those stocks, they may have had no idea that that was the case. Then, after a few days of trading, they see how their portfolio can be impacted by, say, the decisions of a foreign central bank. They had no idea that’s what they were getting themselves into.

I’ve also seen many investors become overly exposed to technology stocks. This leaves them open to the twists and turns of the capital investment cycle of some large companies they don’t own.

I even fell prey to this effect last year when I had both Danaher and Thermo Fisher Scientific on our Buy List. I like both stocks, and it’s no wonder because the companies are similar. Not surprisingly, both stocks tend to behave very similarly, especially in the short term. I should have realized this beforehand.

An investor can own Lowe’s and Home Depot. There’s certainly no law against it, but understand the position and risks you’re taking. To quote Winston Churchill, “Money is like manure, it’s only good if you spread it around.”

Oftentimes, you’ll see an investor who had a particularly strong year but on closer inspection, they were merely overly exposed to a particular risk that paid off. Was the investor brilliant or did some category like small-cap growth have a banner year? Humphrey B. Neill said, “Don’t confuse brains with a bull market.”

Our Buy List is a good example of the portfolio that’s well diversified. You don’t need to own every stock, but a healthy sample can start you on your way to owning a high-quality portfolio that’s properly diversified.

The Worst Environment for Defensive Stocks in Decades

I highlight this point because right now, we’re seeing this effect play out. In particular, I’m referring to the lagging performance of many defensive stocks. Sectors like Consumer Staples and Utilities are at their worst relative performance levels in decades.

Check out this chart below:

The chart shows the S&P 500 Consumer Staples divided by the S&P 500 (in black) and the S&P 500 Utilities divided by the S&P 500 (in red). If those lines are rising, then they’re beating the market, but if they’re falling then they’re lagging the market.

Right now, the lines are as low as they’ve been in at least 25 years. These lines are important to watch because it reflects how popular defensive stocks are, and right now, they’re very unpopular.

What’s going on? Defensive stocks, as the name implies, generally move opposite to the overall economy. When the economy gets weak, investors want to own safe and secure defensive stocks. But when the economy is strong, or is perceived to be strong, then investors shy away from defensive stocks in search of cyclical stocks.

It’s not that one group is in any sense better than another. Rather, time and chance happens to them all. You’ll notice that both lines got a little bump four years ago at the start of Covid. Again, I need to stress that this is relative performance. Both sectors were falling severely, just not as severely as everyone else was.

Defensive stocks tend to do well when interest rates are falling, which also tends to align with a weak economy. Defensive stocks did indeed trail the market as the Federal Reserve hiked interest rates.

Lately, there appears to be a disconnect between defensive stocks and the state of the economy. The economy certainly has its strong points, but I’m still surprised by how poorly defensive stocks have been behaving. I always pay attention when good stocks have underperformed for some time. I wouldn’t be surprised to see the cyclical/defensive cycle soon turn.

On our Buy List, Hershey (HSY) is a good example of a defensive stock that’s been hurting. See the chart below which shows the relative performance of Hershey, meaning HSY divided by the S&P 500.

That’s quite a run-up followed by a rundown. During an economic downturn, folks don’t cut back on their purchases of Hershey Kisses. Over the last ten months, shares of Hershey are down by more than 20% while the S&P 500 is up by more than 20%. Yet, Hershey’s earnings reports have been quite good.

Certainly, some of the damage has been caused by the soaring price for cocoa. Thanks to heavy rains in west Africa, the price for cocoa has jumped 150% in the past year. In response, Hershey has been able to pass on some of those price increases.

Right now, Wall Street expects that Hershey will have flat earnings growth this year. That may be right, but I highly doubt that flat earnings growth will last long. At some point, cocoa production will return to normal, and Hershey will prosper.

I certainly understand the danger in being too defensive, but I think all Street is currently overdoing its aversion to defensive stocks. The cycle will turn.

Tennant: The Floor Cleaner that Beats the Market

I enjoy highlighting superior stocks that may not be well-known. This week, I wanted to bring Tennant Company (TNC) to your attention. The company “designs, manufactures, and markets floor cleaning equipment.”

Tennant has a market cap of just over $2 billion, and only three Wall Street analysts follow the stock.

A few weeks ago, Tennant reported Q4 earnings of $1.92 per share. That easily beat Wall Street’s consensus (such as it is) of $1.25 per share. In three sessions, the stock gained almost 13%.

Tennant has an enviable track record. Since 2000, TNC has outpaced the S&P 500 by a margin of 881% to 445%.

Tennant has increased its dividend for the last 52 years in a row. I’ll never understand why stocks like this are so overlooked.

What to Expect from This Week’s Fed Meeting

The Federal Reserve is meeting today and tomorrow. The FOMC will release its policy statement tomorrow at 2 pm ET. Don’t expect any change to interest rates. The futures market currently places odds of 99% that the Fed will leave rates unchanged. That sounds about right, maybe a little low.

Along with tomorrow’s policy statement, the Fed will also update its economic projections. I’ll caution you that the Fed has a very poor track record of trying to forecast what the economy will do. Still, it’s important to see what they’re thinking.

There won’t be any Fed meeting in April, but the central bank will get together again in early May. Once again, don’t expect much action. Futures traders say there’s a 93% chance that the Fed won’t make any changes to interest rates.

The earliest traders see the Fed cutting rates is at the June meeting. According to the latest prices, traders place a 60% chance of a rate cut then. That’s still far from certain. We’ll learn more in tomorrow’s Fed statement.

That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

P.S. If you want more info on our ETF, you can check out the ETF’s website.

Morning News: March 19, 2024
Posted by Eddy Elfenbein on March 19th, 2024 at 7:04 am

Communist Cuba Is on the Brink of Collapse

Hong Kong Security Law Could Damage City’s Standing as Financial Hub

China Evergrande Founder Accused of Exaggerating Revenue by $78 Billion

Japan Ends Era of Negative Rates With Few Clues on Further Hikes

South Korea Finance Sector Pledges $313 Billion in Green Funding

Oil Stays Near-Four Month High But Russia Export Uptick Weighs

Biden’s Climate Law Has Created a Growing Market for Green Tax Credits

How the Top Oil Trader’s Brazen Corruption Was Caught on Tape

Warren Urges Powell to Cut Rates to Help Struggling Clean Energy

The Fed Is Playing a Waiting Game on Rate Cuts. The Rules Are Starting to Change

The Fed Has a Lot of Questions to Answer About Its Balance Sheet

Email ‘Mistake’ on Inflation Data Prompts Questions on What Is Shared

Why Are Americans Still Down on the Economy?

Wall Street Bonuses Slump to 2019 Low After Dealmaking Drought

UBS Powers Past $100 Billion a Year After Credit Suisse Fall

Congress Should Think Bigger Than TikTok Ban, Tech Critics Say

Nvidia Unveils Successor to Its All-Conquering AI Processor

For These Companies, It Feels Good to Be in Nvidia’s Orbit

Nokia Tells Reddit It Infringes Some Patents in Lead-Up to IPO

Xiaomi’s Fourth-Quarter Profit Rose on Higher Smartphone Sales

Super Micro Offers to Sell 2 Million Shares After Market Rally

How One Company Navigated a Boom and Bust With No Mass Layoffs

United Airlines CEO Tries to Reassure Customers that the Airline Is Safe

Ben & Jerry’s Owner Loses Its Taste for Ice Cream

Wonder, Marc Lore’s Food-Delivery Startup, Raises $700 Million

A New Chapter for Sports Illustrated, With Plans to Keep Print

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Morning News: March 18, 2024
Posted by Eddy Elfenbein on March 18th, 2024 at 7:06 am

BOJ Rate Hike on Tuesday Is Now Widely Expected After Wages Jump

What the End of Japan’s Negative Interest Rates Means

China’s Growth Bump May Dent Urgency for More Stimulus

Powell’s Silence Frustrates Markets as Post-Covid Economy Shifts

Market-Fed Alignment Is Welcome, But Not Enough

Fed Hikes Slash Household Net Interest Income in Break From Past

What Meltdown? Crypto Comes Roaring Back in the Philippines

FTX Bankruptcy Trade Mints 200% Windfall and Sparks Legal Battle

Family Office Head Sees More Peruvian Clients Settling in Miami

Once America’s Hottest Housing Market, Austin Is Running in Reverse

Storing Renewable Energy, One Balloon at a Time

The Department of Homeland Security Is Embracing A.I.

Nvidia’s Conference Will Be ‘Woodstock’ for AI Developers

Apple Is in Talks to Let Google Gemini Power iPhone AI Features

Dan Loeb Enters the Chip Wars

In Latest A.I. War Escalation, Elon Musk Releases Chatbot Code

Tech Job Seekers Without AI Skills Face a New Reality: Lower Salaries and Fewer Roles

XPeng’s Shares Rise on Cheaper Brand Launch

As Electric-Vehicle Shoppers Hesitate, Hybrid Sales Surge

American Manufacturers Seek Perfection as Quality Issues Mount

Boeing’s Pain Spreads to Travelers as Airlines Cut Back on Plans

FedEx and Amazon Discussed Partnership as Competition for Returning Packages Intensifies

Women Are Closing the B-School Dean Gap

Australia Extends Government-Funded Parental Leave to Six Months

What Must Nelson Peltz Do to Get Some Respect?

Craft Retailer Joann Files For Bankruptcy After Consumer Pullback

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Morning News: March 15, 2024
Posted by Eddy Elfenbein on March 15th, 2024 at 7:03 am

Russia Strengthens Its Internet Controls in Critical Year for Putin

Sri Lanka’s Economy Expands For a Second Straight Quarter

Angola Seeks Chinese, Private Funds for Refinery, Air Force Base

China Urges EV Makers to Buy Local Chips as US Clash Deepens

Mexican Peso Is So Strong Investors Fear Betting Against It

Fed Seen Sticking With Three 2024 Cuts Despite Higher Inflation

Peak Rates Boost U.S. Demand for Riskier Form of Corporate Debt

Blame Crypto Bros for the Rising Cost of Your Rolex

‘No Time to Waste’: Japan Inc Set to Step Up Outbound M&A

US Steel Rival Is Ready to Pick Up the Pieces If Nippon Deal Collapses

Honda and Nissan Look to Tie Up in EVs

Self-Driving Cars Enter the Next Frontier: Freeways

OpenAI and the Fierce AI Industry Debate Over Open Source

Why Corporate America Has a Diversity Problem

Young Entrepreneurs Find a Way to Indulge Their C.E.O. Dreams

More Middle Managers Are Being Laid Off

Big Profits and High Prices: There Is a Connection

American Debt Stings Like Never Before in New Era for Households

Dollar Stores Get Devalued as Low-Income Consumers Struggle

Cities Face Cutbacks as Commercial Real Estate Prices Tumble

Texas Cities Grow Fastest in US as NYC Keeps Losing People

When It Comes to Texas, Is Musk All Hat and No Cattle?

Why Having a Baby Isn’t Really Bad for the Planet

McDonald’s Technology Outage Forces Restaurant Closures

Boeing’s Problems Could Soon Become Your Problem

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Morning News: March 14, 2024
Posted by Eddy Elfenbein on March 14th, 2024 at 7:03 am

Can Europe Save Forests Without Killing Jobs in Malaysia?

E.U. Removes Russian Tech Tycoon From Sanctions List

IEA Slightly Raises Oil-Demand Growth View But Cuts Supply Forecast

Hapag-Lloyd Expects Sharp Earnings Drop Amid Choppy Geopolitical Waters

Saudi Wealth Fund Eyes Bond Sales, IPOs to Finance Spending Ambitions

An $80 Billion Crash in India’s Small Caps Flashes Warning Signs

Private Credit Ties to Banks Deepen in Europe as Default Risk Rises

Bond Traders Prep for New Dot Plot, With Three Cuts in Question

Yellen Says Rates ‘Unlikely’ to Return to Pre-Covid Levels

Why the Stock Market Doesn’t Care About Rate Cuts

Duo Behind TikTok Bill Casts a Spotlight on China Fears

TikTok Sell-or-Ban Push to Slow as Bill Hits Senate Turbulence

TikTok Needs to Get Creative to Find a Deal That Wards Off a US Ban

Elon Musk’s Plans to Conquer Europe Collide With Germany’s Culture Wars

Tesla Gets Tagged With Once-Unthinkable Call: Sales Will Fall

Inside the Steel Deal That Has Biden on Edge

Biden Jump-Starts Electric-Vehicle Push With Massive Lithium Loan

Shell Weakens 2030 Emissions-Cut Target in Move Away From Clean Power

Housing Is in Crisis All Around the World

America’s Plumber Deficit Isn’t Good for the Economy

‘Rebate Aggregators’ Are Cashing in on Home Electrification

Dollar General Rises After Outlook Signals Turnaround Is Working

One Big Reason Gen Z Is Still on Facebook: To Save Money

The Vicuñas and the $9,000 Sweater

Watching Sports Is a Mess. Can a New Streaming Service Fix That?

Bud Stock Drops. A Major Shareholder Is Selling Down Its Stake

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Morning News: March 13, 2024
Posted by Eddy Elfenbein on March 13th, 2024 at 7:02 am

Denmark to Add $6 Billion to Defense, Start Drafting Women

Malaysia Rises as Crucial Link in Chip Supply Chain

Now Lawyers Are Suffering From China’s Deal Slump

US, Europe Court Southeast Asia as China Hedge

Sex Abuse Inquiry Poses Leadership Test for World Bank’s Ajay Banga

The Fed Will Slow QT. What Matters Is Where It Stops

It’s a Higher-for-Longer World for Rates, and That’s OK

A Finance Reporter Who Invests in Readers’ Well-Being

US 30-Year Mortgage Rate Drops Below 7%, Spurring Home Purchases

We Still Don’t Believe How Much Things Cost

Corporate Bond Issuance Is Booming—But Not Sustainability-Linked Bonds

How a Physics Whiz Made a Killing Betting on Nature’s Catastrophes

How the World’s Biggest Plane Would Supersize Wind Energy

Pentagon Scraps Plan to Spend $2.5 Billion on Intel Grant

A Ban? A Sale? The Big Questions Hanging Over TikTok

China Condemns U.S. Proposal to Force the Sale of TikTok

TikTok Plans Legal Fight If US Divestment Bill Becomes Law

Gold-Medalist Coders Build an AI That Can Do Their Job for Them

Edtech Unicorns Are Evolving Rather Than Disrupting

Reddit’s Long, Rocky Road to an Initial Public Offering

In Silicon Valley, Venture Capital Meets a Generational Shift

Volkswagen Brand Posts Higher Profit, But Audi Unit Takes Hit

Cancer Clinics Face Cash Crunch After Hack Rocks US Health Care

Lilly Partners With Amazon to Sell More Weight-Loss Drugs

Surge in Fake Ozempic Reveals Dark Side of Weight-Loss Frenzy

Adidas Proposes Flat Dividend as 2024 Growth Expected in Second Half

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CWS Market Review – March 12, 2024
Posted by Eddy Elfenbein on March 12th, 2024 at 6:23 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

Four Years Ago Today

In last week’s issue, I talked about how this time of year has been popular for large-scale market reversals. Today, I want to start off by focusing on one day in particular: March 12, 2020, which was exactly four years ago today.

This was the point at which the world was becoming aware of the scope and magnitude of Covid-19, and March 12, 2020 became one of the most dramatic days in Wall Street history.

By the time trading was done on March 12, it was the fourth-worst day for the Dow in percentage terms in its 128-year history. Poetically, the Dow fell by 9.99%. The only days worse than that came in 1929 and 1987. Investors were completely panicked. Five of the six largest daily point losses for the Dow came in March 2020. Not only that, but six of the eight largest point gains came in that same month.

The market was particularly rattled that day because the ECB decided against raising interest rates which went against expectations. For its part, the Federal Reserve announced $1.5 trillion in open market purchases.

Trading was halted for the second time that week after the S&P 500 fell 7%. Under the rules of the New York Stock Exchange, trading is halted for 15 minutes after a 7% decline. Trading is halted again after a 13% decline. If the market falls 20% in one day, then the exchange is shut down for the day. I thought that might happen in 2020, but we steered clear of it.

On the NYSE, there were 2,376 new lows and just two new highs. The Volatility Index, or VIX, got up to 76.83. That’s close to the highest in history. The S&P 500 finished that day more than 20% off its high. This marked the first official bear market in 11 years.

On March 12, 2020, guess how many stocks in the S&P 500 were more than 10% off their 52-week high? The answer is 502. That’s not a misprint. Nor are my math skills failing me. There are 500 companies in the index but 505 stocks.

I bring these ugly stats up to show you how well the market has done since that scary day. Indeed, it wasn’t the end of the world. It was really a great time to buy assuming you didn’t panic. Over the last four years, that S&P 500 has more than doubled. If we include dividends, then the market has gained more than 120%. The VIX is now down near 14. I think most people have forgotten about March 12, 2020, but it really happened.

To borrow from Mr. Kipling, “If you can keep your head when all about you are losing theirs…then yours is the Earth and everything that’s in it.”

The U.S. Economy Created 275,000 Jobs in February

On Friday, the government said that the U.S. economy created 275,000 net new jobs last month. That beat expectations of 198,000. There was good and bad in this report.

The unemployment rate increased to 3.9%. Technically, this is the highest unemployment level in two years, but it’s still close to a 50-year low. We also had downward revisions in the December and January numbers that came to 167,000 jobs.

Another weak spot is wages. Last month, wages increased by just 0.1%. That was below expectations. Over the last year, wages are up by 4.3%.

The labor force participation rate was unchanged at 62.5%, but the “prime age” rate increased by 0.2% to 83.5%. That’s close to a 20-year high.

Here are some other details:

Job creation skewed toward part-time positions. Full-time jobs decreased by 187,000 while part-time employment rose by 51,000, according to the household survey. An alternative jobless measure, sometimes called the “real” unemployment rate, that includes discouraged workers and those holding part-time jobs for economic reasons rose slightly to 7.3%.

From a sector standpoint, health care led with 67,000 new jobs. Government again was a big contributor, with 52,000, while restaurants and bars added 42,000 and social assistance increased by 24,000. Other gainers included construction (23,000), transportation and warehousing (20,000) and retail (19,000).

In recent weeks, the weekly jobless claims reports have been stable. The economy still had almost 9 million job openings, which is 1.4 for every unemployed person.

Inflation Is Still Running at More than 3%

This morning, the Labor Department released the CPI report for February, and it was largely as expected. Last month, consumer prices increased by 0.4% which matched expectations. Over the last year, inflation is running at 3.2%. That was 0.1% above Wall Street’s forecast.

Core prices also increased by 0.4%. That was 0.1% higher than expected. Over the last year, core inflation is running at 3.8%. That was also 0.1% above consensus. Here’s a look at monthly core inflation:

While there’s no terrible news in this report, inflation is still running above the Fed’s target of 2%. If we ignore shelter costs, then inflation is running at 1.8% over the last year. It’s shelter that’s been driving core inflation.

A 2.3% increase in energy costs helped boost the headline inflation number. Food costs were flat on the month, while shelter rose another 0.4%.

The BLS reported that the increases in energy and shelter amounted to more than 60% of the total gain. Gasoline jumped 3.8% on the month while owners’ equivalent rent, a hypothetical gauge of what homeowners could get renting their properties, rose 0.4%.

A few weeks ago, I mentioned the “supercore rate” of inflation which is the cost of services except energy and housing. The supercore rate is more sensitive to labor costs, and it’s tended to remain high. Last month, the supercore rate cooled off to an increase of 0.47%. That’s down from a 0.87% jump in January.

While inflation is down from its peak from two years ago, the numbers are very stubborn once inflation dips below 4%. The stock market wasn’t terribly bothered by this morning’s report, and that seems like the right way to look at it. Growth stocks were up signicantly today while the gains for Value were more modest.

The Federal Reserve meets again next week, and I’ll spoil it for you. They won’t touch interest rates. Nor will they make any changes in May. At the start of this year, Wall Street expected a rate cut in March and May (there’s not a meeting in April).

The June meeting is a different story. I think there’s a decent chance that the Fed will shave 0.25% off interest rates. Traders still see the Fed cutting rates three times this year.

In recent days, it appears that the stock market is following an “either/or” menu. By that, I mean that either the Nasdaq Composite rises and then the Russell 2000 does the exact opposite, or the Russell rises and the Nasdaq falls. There appears to be no middle ground. Today, it was the Nasdaq up and the Russell 2000 down.

That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

P.S. If you want more info on our ETF, you can check out the ETF’s website.

Morning News: March 12, 2024
Posted by Eddy Elfenbein on March 12th, 2024 at 7:05 am

Why Seizing Russian Assets to Fund Ukraine Is Fraught

China’s Exports Are Surging. Get Ready for the Global Backlash

China’s Vague Hopes for Tech to Reboot Its Economy

China Vanke in Debt Swap Talks With Banks to Stave Off Default

UK’s Bond Sale Draws Highest Demand Since Pandemic Struck

Inflation Thermometer Tops Market Dashboard

Insurance Costs Are Pushing Up Overall Inflation

U.S. Small Business Optimism Weakens on Inflation Worries

US CPI Won’t Inspire Fed to Cut Rates, Bloomberg Economics Says

Goldman Sachs Seeks to Expand Private Credit Portfolio to $300 Billion in Five Years

After SVB’s Failure, Its Attempted Rescuer Charged $285 Million in Fees

Upstarts Challenge a Foundation of Modern Investing

Don’t Bet on That Marketing Degree, Gen Z

Sprouts of Hope in a Gloomy Media Landscape

Lula Plans Airline Bailout to Make Flying Cheaper for Brazilians

Southwest Air to Cut 2024 Capacity, Citing Boeing Challenges

Alaska Airlines Returns Fleet to Service After Boeing Grounding

Air New Zealand Pauses Chicago Flights Due to Engine Shortage

How EV Charger Hacking Threatens Personal Data and the Power Grid

China’s Xiaomi to Start Deliveries of Its First EV Model, Shares Soar

Tesla Abandons an Auto Lobby Over Emissions Rules

Porsche AG Warns of Lower Margins As It Launches New EV, Hybrid Models

Lego Builds Market Share as Ever-Popular Toy Bricks Defy Demand Drop

Kohl’s Falls After Same-Store Sales Miss Expectations

See-Through Baseball Pants Have Fans, and Brands, Pointing Fingers

BAT to Sell as Much as $2.1 Billion of ITC Stock in Block Trade

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