2023-08-07 05:03:50
The markets are pretty close to the weather right now. We had a crazy month of July with non-stop sun and heat and there – poof – beginning of August, we downgrade the US rating, Apple is scary for the rest of the year and – bam – everyone is in doubt and the temperatures are plummeting. However, to start the week we are already wondering if it is time to start buying on weakness once more. It must be said that it has now been 113 sessions WITHOUT the S&P500 falling by more than 2%. Maybe it’s time to start believing that we’ll never go down once more.
The Audio of August 7, 2023
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The week of all fears went well, finally
A week ago, everyone was staring at the numbers from Amazon and Apple. We hadn’t really expected that Fitch would stick its nose in the US debt and cause a slight earthquake and the anger of all the American Democrats who took this downgrade as a personal attack. Apparently Madame Yellen and the White House spokesperson have been put on Ritalin since the announcement and their nervous condition hasn’t improved yet. However, we shouldn’t get too excited, since the market doesn’t seem more traumatized than that with this “downgrade” – it’s more the announcement effect that scared us than the rest. People will continue to buy US treasury bonds thinking it’s the best way to “secure” their investments and it’s going to be fine.
Moreover, if there was any doubt regarding the fact that investors are not even afraid, we can largely come back to two events of the week which seem to me – for my part – much more interesting than the figures of Apple and Amazon, it’s the “masterful jacket shoot” from two big Wall Street ecosystem bearishs – I’m actually so happy to have managed to place “ecosystem” in my column , it will surely improve my ESG score – so last week it should still be noted that Bank of America, which thought we were all going to die in the next crash to come and JP Morgan, which thought we were going to we were all going to die, that we were going to be resuscitated and then we were going to RE-die in the next crash, both revised their expectations and suddenly think that we have to look up more than down and that the recession, it will not pass by us!!!
Salutations
We can therefore welcome this 180 degree turn and wonder (by the way), if this is good news or not. No, because on the one hand it’s always nice when there are more bulls than bears and it’s reassuring to see that no one is afraid of anything anymore. But, on the other hand, if you’re a bit “upsetting” and don’t like going with the crowd, you might wonder if there aren’t “a few too many optimists out there”. We will probably have the answer in the weeks to come, since we know that we are approaching the period of months that we qualify as “complicated”. Oh, they’re not going to put us down the market for the three weeks left in August – it’s not the season – but then it might be fun – if it’s going to go down.
In any case, if we have to talk quickly regarding the weekly report, we will remember that Amazon has been a hit and that it is the new star of the moment. As for Apple, the numbers were “a little soft” and fears regarding the future (in the conditional) are a little more strained – well, when I see the families around me vacationing on their smartphones and spending their days of taking photos and scrolling on Tik-Tok, I tell myself that the iPhone still has many good years ahead of it. But for the moment, it should still be noted that “technically”, Apple is out of its uptrend. No need to have done long studies of technical analysis to see it. And as we have been told for a thousand years that the trend is your friend, until it is no longer your friend, you will still have to watch it carefully. Finally, I say that, I say nothing. Especially since we can still see that when Apple drops 5%, it’s not easy to go once morest the wind.
Apple chart – Source: Tradingview.com
And now what?
In summary, last week we experienced a week of decline, something that had not happened to us for a long time. But this morning, futures are up 0.4%. We have the impression that we are already buying on weakness while waiting for the inflation figures which will fall on us at the end of the week. Yes, because with the figures from the American CPI, if it drops a little further (if we still persist in ignoring oil), we can always say to ourselves that under these conditions, the FED will no longer raise the rate. And this, even though the FED’s Michelle Bowman said this weekend that the FED will HAVE to keep raising rates even further to get to that famous 2% inflation. Except that we still prefer to see the glass half full.
During the coming week, we will still have an avalanche of quarterly figures, but nothing more as important as last week. There will be Disneys, UPSs, Eli Lillys, but nothing as big as Apple. The next one to release and stress the market is Nvidia. But Nvidia is not the same, because their growth is incalculable and stratospheric, so the figures will necessarily be canonical. We will have to wait until the end of the month to find out, but I will tell you regarding it.
News of the day
In today’s news, Japan is doing nothing this morning. Neither was Hong Kong and China was down 0.56%. Oil is at $82.73, Gold is at $1973 and Bitcoin is at $29,177. It should also be noted that FOR THE FIRST TIME in quite a while, the FT mentions the fact that the price of oil is becoming a “problem” in Washington. Hey, they finally realized that the fact that the barrel goes from $64 to $83 might have any impact on the lives of their “American fellows” as they say??? It should also be noted that the Chinese government has asked Chinese economists NOT to be negative regarding the local economic recovery (at the risk of winning an all-expenses-paid stay in economic recovery camps). We immediately feel that a wind of freedom is blowing over China. Every day a little more.
Otherwise, it will be necessary to remember that Berkshire Hathaway has accumulated nearly 150 billion in cash and that we are at levels never seen in Warren Buffet’s society. There is also “Barbie” which has passed the 1 billion mark in revenue since its release. And I’m absolutely for nothing. And for the rest, we’re going to focus on the numbers for the week – not a lot of macro – but a lot of micro and then we’re going to talk regarding inflation and let a bunch of central bankers speak throughout the week. .
For the moment, the futures are therefore up by 0.4%, we buy back on weakness, we don’t ask ourselves any questions, the bulls are in the majority, even if Apple is no longer in an uptrend. Have a great fall day and we’ll see you tomorrow for new adventures…
See you tomorrow !
Thomas Veillet
Investir.ch
« Only a life lived for others is a life worthwhile. » -Albert Einstein
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#Bears #throw #towel #trend #longer #Apples #friend
