Morning Reads

Morning Reads

Open Interest Changes



Traders are looking forward to the turkey and trimmings, but there's one more session ahead before they shut off their screens for Thanksgiving. Markets will be open again on Black Friday from 9:30 AM to 1 PM ET, but the holiday-shortened week is typically characterized by some of the lowest trading volumes of the year. Investors have a lot to be thankful for in 2023, provided they have invested wisely, with market benchmarks like the S&P 500 (SP500) and Nasdaq (COMP.IND) up 19% and 37% YTD, respectively.

At the register: Average turkey prices cost 5.6% less than last year, according to the Farm Bureau, coming in at $27.35 for a 16-pound turkey. That's not all. Cranberries are down 18.3%, stuffing mix costs 2.8% less, pie crusts are 4.9% lower, while prices on whipped cream have slumped 22.8%. Other items have increased marginally, like dinner rolls, potatoes and pumpkin pie mix. Overall, the average price of a traditional Thanksgiving feast for 10 people in 2023 runs $61.17, or less than $6.20 per person, down 4.5% from a year ago.

Costs have not only been falling on the dinner table. Gas prices have declined for nine straight weeks now amid a drop in crude prices and seasonal weakening demand, with the national average for a gallon of regular gas standing at $3.28 on Wednesday, according to AAA. Lower prices are helping lead to a travel resurgence on highways and in the air, with 55.4M Americans traveling at least 50 miles from home between today and the Sunday after Thanksgiving. The TSA is also anticipating the busiest holiday travel season on record, expecting to screen 30M passengers during the Thanksgiving travel period (Nov. 17-27), marking a 9% increase Y/Y and up 1.7M passengers over pre-COVID record levels.

Some history: The first Thanksgiving between the Mayflower pilgrims, who founded the Plymouth Colony in Massachusetts, and the Wampanoag tribe, is said to have taken place in 1621. Thanksgiving proclamations were made in subsequent years, and in 1789, George Washington declared November 26 "as a day of public thanksgiving and prayer, to be observed by acknowledging with grateful hearts the many signal favors of Almighty God." Americans still observed the holiday on differing dates, so beginning in 1863, President Lincoln encouraged Americans to recognize the last Thursday of November as "a day of Thanksgiving." A few years later, in 1870, Congress followed suit by passing legislation making Thanksgiving a national holiday.

Blowout report

Nvidia (NVDA) shares fell 1.7% AH to $490.75/share on Tuesday even as the semiconductor giant posted results and guidance that handily beat expectations. Revenue more than tripled from a year ago to $18.12B, surging past estimates, with data center revenue at a record $14.51B. While there was no "meaningful impact" from the Biden administration's export controls in Q3, Nvidia expects sales in China to decline "significantly" in Q4. "We do not have good visibility into the magnitude of that impact even over the long-term," CFO Colette Kress cautioned. While SA analyst Bill Maurer believes Nvidia's valuation is still reasonable, Investing Group Leader Jonathan Weber said waiting for a better entry point might pay off. (170 comments)

He's back

Sam Altman is returning to OpenAI as CEO after a drama-filled week that saw him jump ship to Microsoft (MSFT) and may include more surprises. OpenAI's new initial board will feature former Salesforce (CRM) co-CEO Bret Taylor as chairman, ex-Treasury Secretary Larry Summers, and Quora CEO Adam D'Angelo. "When I decided to join Microsoft, it was clear that was the best path for me and the team," said Altman. "With the new board and with Satya’s (Nadella) support, I’m looking forward to returning to OpenAI, and building on our partnership with Microsoft." Most of OpenAI's staff threatened to quit after Altman was ousted in what Wedbush called an "embarrassing circus show," while SA analyst Michael Fitzsimmons said OpenAI was "hoisted by its own petard." (28 comments)

'Proceed carefully'

All Federal Reserve officials agreed to "proceed carefully" with interest rates, according to the minutes from the FOMC's latest policy meeting. All members wanted rates to stay restrictive "for some time," as inflation remains above the 2% objective, with virtually no interest in cutting rates anytime soon. Fed officials also see Q4 economic growth cooling "markedly" from the 4.9% jump in Q3. At the Oct. 31-Nov. 1 meeting, policymakers held the federal funds target range steady at 5.25%-5.50% - the highest level in 22 years - after boosting it in July. Traders are largely certain that the Fed will maintain rates this year, with the odds of a rate cut priced in for 2024. (3 comments)

Today's Markets

In Asia, Japan +0.3%. Hong Kong flat. China -0.8%. India +0.1%.
In Europe, at midday, London -0.1%. Paris +0.4%. Frankfurt +0.4%.
Futures at 7:00, Dow flat. S&P +0.1%. Nasdaq +0.3%. Crude -1.2% to $76.82. Gold +0.1% to $2,003.10. Bitcoin -2% to $36,467.
Ten-year Treasury Yield -4 bps to 4.38%.

Today's Economic Calendar

7:00 MBA Mortgage Applications
8:30 Durable Goods
8:30 Initial Jobless Claims
10:00 Consumer Sentiment
10:30 EIA Petroleum Inventories
12:00 PM EIA Natural Gas Inventory
1:00 PM Baker Hughes Rig Count

Companies reporting earnings today »

What else is happening...

WSB survey results: Honesty, integrity top qualities for CEOs.

Binance CEO Changpeng Zhao steps down, pleads guilty.

Lowe's (LOW) stock slides as do-it-yourself demand fades.

China gives conditional nod for Broadcom-VMware (VMW) deal.

Ford (F) scales back EV battery plant, restarts construction.

PE firms near €14B deal for eBay (EBAY)-backed Adevinta.

Warren Buffett donates 2.4M Berkshire shares to charities.

Best Buy cuts holiday quarter outlook on 'uneven' demand.

Tim Cook discusses Apple's 'detailed' CEO succession plans.

Existing home sales decline more than expected in October.

Judge sets deadline for Rite Aid (OTC:RADCQreorganization.

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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