Stocks tumbled for the third session in a row with the S&P falling nearly 3% amidst the backdrop of the war in Ukraine and soaring commodity prices. Asia markets closed lower overnight while Europe indexes are actually in the green this morning. U.S. futures are pointing to a lower open as I write this, while the Dollar, Yields, Oil, and Gold are all in the green.
Here is my rant form yesterday if you missed it : JB Rant – March 7th, 2022
And here is what UPB is reading this morning: Tuesday Reads
Commodity prices having been going nuts - in case you haven't heard. Wheat was limit up yesterday and now you have Nickel futures being halted as it topped the $100k per ton mark. This morning there are reports that the US will ban Russia Oil imports, not a big surprise and it has put another bid back in Oil, which is trading over $124 again as I write this. Steel and AG stocks lost most of their gains yesterday and are trading lower this morning. Would not be surprised to see some of the names like AA, X, FCX, MOS, NTR, ect to have wild swings this week. I may look at some spec calls on AA today, especially if it can reverse the morning gap and retest that $85 handle:
SCHN came up to that $52 resistance again on Monday, only to find pressure and close down 1%.. Once that $52 breaks, it should be off to the races:
AVAV was one of the best performing stocks yesterday despite the market carnage. The stock closed up nearly 9% and broke and held that key $75 level. I would love to see some continuation today but would not be surprised to see some consolidation first. I locked more of my $80 calls in for nearly 400% and may look at some later dated strikes if there is a pullback today:
It was another rough day for BPT closing down over 11%. Of course would like to see it go parabolic, but looks like some are taking profits after the huge run. With Oil over $125 as I write this, the BPT divy will be a few $1s. You multiple that by 4 quarters and it could be a 50% divy stock. At some point folks will realize that and there will be some FOMO. May look at some April and/or June strikes to add to my March freebies:
POOL has their investor day at 11am this morning. Berenberg Bank is out this morning reiterating their Buy rating while adjusting their PT to $517 from $557. They posted a monster beat and raise in February and I am confident they will be extremely bullish in regards to their future at the investor day. Spreads make it very tough to play but will be watching for some possible calls before 11 to play for a move back over $500 in the coming weeks:
I added CVGW calls ahead of earnings tomorrow after the close. Would love to be able to close some out to cover costs today or tomorrow and ride free into earnings:
The SPY broke that key $425 level. Overnight it seems to have found support at $410. I was looking at some possible hedges in the cloud/growth names but the risk/reward does not jive. MDB, for example, closed down over 8% but the puts traded up 75-100%. Sounds like a great return but you are paying extremely high premiums(risk) and your timing has to be perfect or you will just experience premium erosion(reward). Not only that, any bounce and premiums will be crushed. May eye some triple ETF puts if that $410 is breached today otherwise I will be more apt to look at some spec calls for the eventual bounce:
POTUS speaks at 10:30 am today, could move markets a bit so something to be aware of.
Here are the analyst changes of note for today:
Having issues again with the upgrades/downgrades, my apologies
And here is what I am watching today: POOL, AVAV, BPT, CMG, MDB, X, AA, SCHN, MOS, NTR, and SQ.
Let's have a great day!
-JB