Speaking of consumer discretionary PII (Polaris) raised guidance they continue to see a healthy consumer.
Liz Saunders on CNBC urged caution here.
Fed keeps reiterating not pivoting and market seems to not care.
Biggest inversion of 2 and 10 year rates in a long time.
Do we want more jobs tomorrow or fewer jobs? Think you always root for more jobs and deal with it.
On oil, going down as you thought it might and oil stocks down but weather forecasters (for all they know) predicting a bad hurricane season, (thundering here right now, yea, we need the rain) and John Kemp talked about declining inventories last week, know that changes quickly.
Some of my sold puts on oil companies for Aug near or in the money, will roll them into next month.
I think spending will hold up better than many think. Low end is definitely an issue (lowest quintile). This will be more of a manufacturing pullback IMO similar to 2015. That wasn't a recession but mfg PMI was 48, etc. I'm not sure what to make of the S&P services at 47 though. Above the low-end though balance sheets are in great shape, assets are near all time highs, etc.
On oil we'll have to see. A lot of headwinds with softening demand (for a variety of reasons (China, India (monsoons), airline issues crimping jet fuel, etc.). Still have those SPR releases. I actually wrote this earlier to someone:
I think there's a big difference between the commodity and the stocks here. I agree the stocks should be well supported due to cash flows, improved balance sheets, capital return, etc. I also think there's a lot of support for WTI to be in the $80-90 range through next year if not well above depending on the global economy (particularly China) and how things play out with Russia. But commodities are notorious for overshooting. WTI *should* bottom at $84.70 area as I noted yesterday, but if that doesn't hold, low 80's is next. If that cracks, we're talking 60's. I said a few months ago in a recession similar to 2000 XLE would probably find it's way back to the $60 level (that would be a similar pullback to that pullback). Still think that. But hopefully we don't have to test that.
I noted I had sold a lot of calls on the last weekend report. I have bought many of those back. Haven't sold many puts yet though.
The difference is my positions in energy are reasonably small, so puts give me a bit more exposure to area. Technical are difficult and if we get into recession maybe demand will get destroyed much more but I am not so sure. Geopolitical is so much different today than yesterday (years). Been a transition to get out of small bios and invest into other areas and still keep cash so starting to get there. Just takes time to learn to be a better investor.
Are you related to the CNBC analyst Sarat Sethi, pretty smart guy. He was on half time. Guess is it is like everyone asking me if I am related to Arlo?
Not sure if you follow PBR, may lose my shares on a buy-write I did with a 14 call. Nice profit ! But the puts sell for much more than calls. Stock is about 14.50, $1 out of money 13.50 put is around 1.60 while a 15.50 call is .13. So the market is betting the stock goes down. Maybe because of the control by Brazil, who have stated they may reduce the price of oil for sale in the country. Guess I'll let this be for now.
Thanks Neil, comments are always helpful. Late start to today's session, see oils are up, since I am just getting upstairs not sure why yet. Did see China not happy with us and Baba is down, maybe related. Good week for bios for me, had large position in ALNY which I now sold as 6 minute walk is tricky (did well) and GBT might get brought out by PFE another decent position. Sold half of GBT as my first trade.
Nice summary,
Speaking of consumer discretionary PII (Polaris) raised guidance they continue to see a healthy consumer.
Liz Saunders on CNBC urged caution here.
Fed keeps reiterating not pivoting and market seems to not care.
Biggest inversion of 2 and 10 year rates in a long time.
Do we want more jobs tomorrow or fewer jobs? Think you always root for more jobs and deal with it.
On oil, going down as you thought it might and oil stocks down but weather forecasters (for all they know) predicting a bad hurricane season, (thundering here right now, yea, we need the rain) and John Kemp talked about declining inventories last week, know that changes quickly.
Some of my sold puts on oil companies for Aug near or in the money, will roll them into next month.
I think spending will hold up better than many think. Low end is definitely an issue (lowest quintile). This will be more of a manufacturing pullback IMO similar to 2015. That wasn't a recession but mfg PMI was 48, etc. I'm not sure what to make of the S&P services at 47 though. Above the low-end though balance sheets are in great shape, assets are near all time highs, etc.
On oil we'll have to see. A lot of headwinds with softening demand (for a variety of reasons (China, India (monsoons), airline issues crimping jet fuel, etc.). Still have those SPR releases. I actually wrote this earlier to someone:
I think there's a big difference between the commodity and the stocks here. I agree the stocks should be well supported due to cash flows, improved balance sheets, capital return, etc. I also think there's a lot of support for WTI to be in the $80-90 range through next year if not well above depending on the global economy (particularly China) and how things play out with Russia. But commodities are notorious for overshooting. WTI *should* bottom at $84.70 area as I noted yesterday, but if that doesn't hold, low 80's is next. If that cracks, we're talking 60's. I said a few months ago in a recession similar to 2000 XLE would probably find it's way back to the $60 level (that would be a similar pullback to that pullback). Still think that. But hopefully we don't have to test that.
I noted I had sold a lot of calls on the last weekend report. I have bought many of those back. Haven't sold many puts yet though.
The difference is my positions in energy are reasonably small, so puts give me a bit more exposure to area. Technical are difficult and if we get into recession maybe demand will get destroyed much more but I am not so sure. Geopolitical is so much different today than yesterday (years). Been a transition to get out of small bios and invest into other areas and still keep cash so starting to get there. Just takes time to learn to be a better investor.
Are you related to the CNBC analyst Sarat Sethi, pretty smart guy. He was on half time. Guess is it is like everyone asking me if I am related to Arlo?
Not sure if you follow PBR, may lose my shares on a buy-write I did with a 14 call. Nice profit ! But the puts sell for much more than calls. Stock is about 14.50, $1 out of money 13.50 put is around 1.60 while a 15.50 call is .13. So the market is betting the stock goes down. Maybe because of the control by Brazil, who have stated they may reduce the price of oil for sale in the country. Guess I'll let this be for now.
Thanks Neil, comments are always helpful. Late start to today's session, see oils are up, since I am just getting upstairs not sure why yet. Did see China not happy with us and Baba is down, maybe related. Good week for bios for me, had large position in ALNY which I now sold as 6 minute walk is tricky (did well) and GBT might get brought out by PFE another decent position. Sold half of GBT as my first trade.
Look forward to weekend report. Thanks again.