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Thursday, October 13, 2022

Market Update 10/13/2022 - Time to re-group, ahead of Earnings Season + A BONUS SECTOR CHART!

Yesterday, it occurred to me, that the market is waiting for something, and I figure that something must be earnings season, and that officially kicks off with Bank earnings over the next 2 days, including $JPM on Friday. 

 $JPM is a stock we've been watching closely over the past couple weeks - This should be real interesting since non other than CEO Jamie Dimon continues to tell us how bad things are. 

Something else that was on my mind, yesterday, and let's face it, sometimes the market is so dull, that there's not much else to do, but let your mind wander... 

Re: The Fed tightening:  

If the economy was strong - which it is, or was, when the FED started tightening monetary policy, then the market should be pricing in a recovery, as interest rates rise, yet investors are looking at what has always happens in the past, when TheFed suddenly pulls the punch bowl away, and that has always turned out to be a very sobering experience (pun intended).  

See this: 

Comparing the Speed of U.S. Interest Rate Hikes (1988-2022) visualcapitalistcom

The above graph is a good representation of why certain market participants are having a freak-out moment. The pace of these rate hikes doesn't point to a recovery, but to an economy that's running too hot, but can the rate of these increases continue, or will the fed pause, and when...? 


Seeing another shakeout to a lower low, on another backward looking inflation indicator 

Dow futures drop more than 500 points, on hotter than expected inflation report cnbc  

The only reason CNBC prints the DOW down 500, is because it sounds like a lot. 

So, expect another little shakeout to a lower low, at the open, just ahead of what will probably turn out to be a, "not as bad as expected", earnings season. 

Bonus chart! I like Airlines here

Good Luck, 


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