Markets closed higher again on Wednesday, with the S&P adding .43%. Asia markets closed higher overnight while Europe indexes are in the green. U.S. futures are pointing to a higher open as I write this(though CPI data may change that), the Dollar and Yields are lower while Oil and Gold are higher.
CPI and weekly jobless claims data came out this morning, with the CPI coming in a tad hotter than expected while Jobless claims came in under expectations. We now have the monster jobs report Friday, the higher than expected PPI yesterday, and now higher than expected CPI today. Hard to think this does not give ammo to the Fed to raise rates before the year its out, especially with a new headwind from the Middle-East. The market is only pricing in a 30% chance of a hike before the year is out, think that will go up tomorrow. The SPY almost came up to retest that 50dma yesterday, If we fall today, will be watching that $432 handle again for support. A break underneath and I will be looking again at TZA calls and IWM puts:
A blurb from a nice read from the WSJ on the Government debt. I wouldn't call it the canary in the coal mine, but certainly an issue that will come to roost if rates keep rising... something to revisit for sure:
The largest spending increase this year was the cost of the government paying for its debt. The Treasury spent $711 billion on net interest payments last fiscal year, an increase of $177 billion, or 33%, from fiscal year 2022, according to CBO.
I sat on my hands yesterday ahead of today's CPI numbers. May be a bit more aggressive today.
DPZ reported earnings this morning that bested estimates on the EPS side but missed on the revenue side. The EPS beat was from a one-time item so the EPS number is distorted. Jeffries is out this morning reiterating their Hold rating but also waiting to hear company commentary on UBER and Weight-loss drugs... wow, weight loss drugs. Any hint from the company on that side and it'll will not be good for the stock. Either way, the rest of my DPZ puts will likely take a hit at the open pending any big outsized drop before the bell. Will likely hold the puts while using $356 or so as a stop where I would look to salvage. On the flip side, if it fails to retake $350, may look at some spec puts for a move into the low $330s:
WW gave back some of Tuesdays gains, closing down nearly 5% as folks to some profits. The trend is still up and think $13+ before the week is out. For what its worth, WW is up 255% this year, so there are folks in much lower taking profits on all the big moves:
ULTA teased yesterday, breaking down to $386 in the morning only to find a bid and close down .44%. Will need a big move here into Friday for my puts to come back to life:
AZO also teased yesterday, trading down nearly $50 in the morning before finding buyers to close down .22%. Still have plenty of time on my puts:
SHW closed slightly higher yesterday. Still think sub $250 is coming:
Names I had on watch for calls floundered yesterday. Still looks like a potential bottom bounce on ROKU with a move north of $77.50 in the coming days but will be patient:
TWLO closed off 1%. It actually has a death cross setting up. Will need to find some buyers today or I will take it off watch and revisit:
LLY is the one that got away. I had it on bounce watch last week and took my eyes off it. Sure enough it has run from $520 to $605 in 6 sessions and look to make more highs today with the liver news yesterday fueling the fire. Not sure I will try and chase here:
Will be on audio in the chatroom around 11:30 am or so.
And see is what I am watching today: TWLO, DPZ, LLY, WW, VKTX, NVO, ROKU, NFLX, AZO, ULTA, ORLY, LLY, NOW, MDB, SITE, MELI, ADBE, AVGO, WIX, ALGN, SPOT, OKTA,LRCX, CMG, QQQ, BLK and TEAM.
Let's have a great day!
-JB