Print the page
Increase font size
Putting a Pin in Pivot Talks

Posted November 22, 2022

Ray Blanco

By Ray Blanco

Putting a Pin in Pivot Talks

Investors have been slightly optimistic this month that, because CPI reports showed early signs of cooling inflation, the Fed Reserve would potentially announce a pivot soon. 

However, pivot talks have had a pin put in them this week with a statement from the Federal Reserve Bank of San Francisco President Mary Daly… 

On Monday she said that officials may lift rates above 5% if inflation does not ease. 

She also noted that writing off a 75 bps hike in December is "premature," and "nothing is off the table." 

Even still, the market was up slightly today and remains up on the month. 

As things stand, the Dow continues to outperform the other major indices, up about 9.5% over the past month compared to the 6.3% and 2.3% gains in the S&P and Nasdaq, respectively.

That’s not to say there still isn’t plenty of lost ground to make up across the board, especially for the tech-heavy Nasdaq, which is down over 28% on the year. 

And we continue to see trouble in the tech space as earnings roll on… 

Just today Zoom Video Communications (NASDAQ: ZM) dipped nearly 8% to start the day as a result of trimmed annual revenue outlook and projected challenges posed by a sinking demand for online conferencing.

Also, a new wave of restrictions has come down on China as Covid-19 cases climb, causing further issues for tech supply chains. 

Can’t Quit Covid Restrictions 

A renewed spike in Covid across China has brought down another wave of restrictions…

This will surely take its toll on the world's largest economy and cause trouble for companies following a short-lived celebration just weeks earlier when the previous round of aggressive lockdowns ended.

Almost three years after the initial Covid-19 outbreak, the pandemic is still hovering over the Chinese economy. 

Now, the new restrictions threaten hang-ups to supply chains and demand for goods, made even worse by the increased consumer spending normally associated with the holiday season.

As of today, parks and museums in Beijing are shut down while Shanghai tightened restrictions for people entering the city. 

Citizens and businesses now experience renewed concern about the economy, with dimmed hopes for a quick reopening.

The recent lockdowns have put China’s economy face to face with its slowest growth rates in decades… 

Now, a property bubble has burst, unemployment among the youth has hit a record high, and private sector businesses have been frozen due to the Chinese authorities' policies. 

Investors were hopeful that the more localized restrictions from China would help better curb the spread of the infection, but the majority of analysts recommend caution when being bullish.

The situation in China is also putting pressure on companies around the globe that rely on the country’s massive manufacturing capacity, especially with the holiday season rapidly approaching. 

Many retailers rely on the boosted sales that come with the holidays to bolster Q4 earnings reports. 

Now, with an already troubling year for earnings, the outlook is starting to slip as we head into the winter. 

This just adds to the justification a lot of companies are referring to when looking to move some production capacity outside of China. 

Places like India and Vietnam are both seeing rising industrial real estate prices as they become new hot spots for manufacturing.

Do Tech Advancements Have a Limit?

Posted November 25, 2022

By Ray Blanco

Tech stocks are struggling to hold onto any substantial move right now, especially with disappointing earnings, record inflation, recession talks, and more.

Recession Blues? There Are a Few Things to Try

Posted November 24, 2022

By Ray Blanco

In this update, I’ll share a few ways you can navigate a recession and still participate in the stock market.
Disney Rallies, Twitter Faces Debt, FTX, and More

Disney Rallies, Twitter Faces Debt, FTX, and More

Posted November 21, 2022

By Ray Blanco

Even with the shortened trading week, there’s plenty to talk about in the tech industry.
New Horizons Outside of China

New Horizons Outside of China

Posted November 18, 2022

By Ray Blanco

China has long been the dominant player in consumer electronics manufacturing, standing alone in its ability to bring on many high-skilled workers and develop massive production capacity. But now, that’s starting to change.
Recession Proof Your Portfolio With Med-Tech

Recession Proof Your Portfolio With Med-Tech

Posted November 17, 2022

By Ray Blanco

Be on the lookout for some of these more defensive plays. Having a few of these names in your portfolio might be the difference between a red and green holiday season.
Target Tumbles, Retail Sales Spell Bad News For Rate Hikes

Target Tumbles, Retail Sales Spell Bad News For Rate Hikes

Posted November 16, 2022

By Ray Blanco

The general consensus seems to be that investors see strong consumer spending as a sign to the Fed Reserve that big rate increases can continue.