Market Thoughts

Samantha is traveling to NYC for meetings, presentation at the Benzinga conference and sourcing apartment for her daughter doing an internship at an architectural firm this summer. She will be busy and away from her trading desk for the remainder of the week.

Here’s Samantha’s MarketWatch article:


@WallStreetJane here filling in with some thoughts:

It’s no secret the Fed’s “independence” isn’t so independent. But now, any semblance of a line separating the Fed from the pressures of the White House is gone.  They may not have gone as far as to actually cut rates or announce changes to the balance sheet reductions, but their words and the dot plot did just enough to appease the President and the market.

By far the toughest question of the day was when Powell was asked what effect a rate cut might have on the economy. Powell simply didn’t want to or couldn’t give a straight answer. He did, however, implicitly agree to the notion of more aggressive cutting when rates are near the zero bound –  “An ounce of prevention is worth a pound of care. That is a valid way to think about policy in this era.” I have a very hard time thinking any rate cuts are going to provide material stimulus to credit markets or the economy.  It will, however, likely keep the market happy for a while.

So now that the much anticipated Fed meeting is over we can focus on the next drama soup, namely the G-20, and Trump stirs the pot better than most. We’ll wait with bated breath to see if Trump can walk away from the G-20 with material progress on the China front. Should the meeting between the two leaders be a big dud you’d think nervousness would creep back in to the markets.  Not so fast! We get the pleasure of the July Fed meeting where they are expected to cut rates – possibly by 50 basis points.  One day this game will end in a tsunami of tears.  Until then, keep riding the wave.

Stocks of Interest in the News

Retail Stocks: Some retails names were hot, fire, flames, with ULTA finishing up 3.06%, SHOP up 7.50%, and W up 3.93%

GLD: Gold held up post Fed meeting, posting it’s highest close in two years.

ADBE: Adobe reported earnings last night; beating and receiving multiple price target upgrades this morning.  The stock finished the day up 5.21%

Slack’s Direct Listing Reference Price Is Set at $26 by NYSE

Slack is skipping the traditional route to go public — through an initial public offering — and instead choosing to trade shares directly on the exchange on Thursday. Though the unusual method means the company isn’t raising new money, it also avoids the costly underwriting fees paid to multiple banks on IPOs. Instead, Slack chose three advisers that have helped determine the reference price, and will tomorrow choose when and at what price to open the shares.

Macro Matters

With Trump hammering on the luxuries other countries enjoy by devaluing their currency, PIMCO takes the view that the strong dollar’s run is “Close to an End.”

Emerging-market currencies offer some of the best value today as an eight-year run of dollar strength is “close to the end,” according to Pacific Investment Management Co.  “We like to be long a number of those,” Gene Frieda, a Pimco strategist in London, said Wednesday on Bloomberg TV. Slowing U.S. growth will finally put a dent in the greenback, while counterparts in the developing world are about 15% undervalued, according to Frieda. Japan’s yen is a “unique” investment in that it’s a safe currency that’s actually cheap, he said.

Bond Market Screams at Fed: Don’t Dawdle on Those Rate Cuts:

It looks like the U.S. Treasury market just goaded the Federal Reserve into shifting gears on interest rates, to consider the first reduction in more than a decade. Now, the world’s biggest bond market has further marching orders for Chairman Jerome Powell and his colleagues at the central bank: Don’t dawdle on those cuts.

Trade Wars and More

The number of Iran accusers is growing as evidence mounts that the Islamic Republic was responsible for recent oil tanker attacks. House Intelligence Chairman Adam Schiff said there is “little question” the country’s was behind the action. German Chancellor Angela Merkel, a Trump skeptic, agreed.

Per MarketEar:

Samantha Says

Market Commentary from Samantha’s Live Trading Room and StockTwits Premium Chat Room

Samantha was traveling to NYC today for her Benzinga presentation tomorrow.  Stop by and say hello if you’re in NYC.

Wall Street Jane’s Journal

Jane is not only Samantha’s Live Trading Room moderator, she facilitates client engagement and relays Samantha’s trade ideas into the LaDucTrading StockTwits Premium Room. A former banking VP during the GFC, she now actively trades full-time and actively shares her trading ideas, plan and process. 

The market juice kept flowing and, while some names remain extended, others that haven’t participated in the last couple of days had a nice afternoon.  I already mentioned retail above, but made note of ULTA this morning in the room:

Well, afternoon action came and ULTA took off.  I missed the entry at the lunchtime lull.  It looks very much like the next stop is at new all-time highs.

I have long operated utilizing the KISS theory –Keep it Simple Stupid.  Real Vision continues their Mental Game of Trading Series with a great interview about just this.

Great Reads

New breakthrough pill could cure tinnitus:

The debilitating condition was stopped in mice by blocking a protein that fuels brain inflammation. The US team of scientist are hopeful it will lead to a gene therapy to combat ringing in the ears and other hearing loss disorders.