Monday Tee Up: Here Comes Walmart The focus this week flips back to inflation and the state of the consumer. Key inflation data will come out as will perhaps the most-telling earnings report related to the consumer -- Walmart. Wall Street is wondering if the Fed has been right on interest rates and can still achieve a soft landing and avoid recession. Last week, the Dow Jones Industrial Average ended down 0.6%, the S&P 500 lost 0.4%, and the Nasdaq fell 0.2%. Year to date, the Dow is higher by 5%, the S&P is up 12%, and the Nasdaq is higher by 12%. On the economic calendar, the big day is Wednesday, when inflation data comes out in the form of CPI. In June, CPI posted at 3.0%. Core CPI was 3.1%. We see July matching those rates. On Tuesday, wholesale inflation will grab the headlines when PPI is updated. On Thursday, Retail Sales, Industrial Production, and Capacity Utilization all will be released, and on Friday, Consumer Sentiment and Housing Starts come out. The earnings calendar is winding down but some big releases are due in this week. On Tuesday, Home Depot and On Holding report. On Wednesday, Cisco and UBS Group. And on Thursday, Walmart, Applied Materials, Alibaba, and Deere. Earnings are coming in 12.4% higher this quarter than a year ago (this after some 91% of S&P 500 companies have reported). Expectations were for 8%-12% earnings growth for 2Q. This follows 8% growth in 1Q and 10% in 4Q23. Last week, mortgage rates fell a big 26 basis points (bps) to 6.47% for the average 30-year fixed-rate mortgage. Gas prices fell four cents to $3.45 per gallon for the average price of regular gas. The Atlanta Fed GDPNow indicator is forecasting for 3Q and calls for expansion of 2.9%. The Cleveland Fed CPINow indicator forecasts 2.74% for August CPI. Looking ahead, the next Fed rate decision is on September 18, with odds at 100% for a rate cut. Of that, 51% expect a 25-bps cut and 49% expect a 50-bps cut. That data is according to the CME FedWatch Tool. There are then two more Fed rate meetings this year, on November 7, two days after the U.S. presidential election, and December 18.

Blue-chip stocks are lower at midday on Thursday in the wake of another increase in weekly jobless claims, this time to 242,000. The 300,000 level is where we start to worry about an impending recession. On the flipside, the yield on the 10-year Treasury note is down slightly to 4.28%, which is supporting Technology stocks and the Nasdaq Composite.

Energy may be an Under-Weight sector based on our model, but that doesn't mean it shouldn't be in diversified portfolios. Energy now accounts for 3.7% of S&P 500 market cap; over the past five years, the weighting has ranged from 2% to 10%. We think investors should consider allocating 3%-4% of their diversified portfolios to the Energy group. The sector is outperforming thus far in 2024, with a gain of 14.8% compared to a 7.4% increase in the S&P 500. It underperformed in 2023, with a decline of 4.8%. The sector includes the major integrated firms, as well as exploration & production, refining, and oilfield & drilling services companies. Here are the Energy companies that either are on our Focus List or are used in our model portfolios.

Small- and mid-cap stocks (SMID) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. For one thing, SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from unrest in the Middle East, the Russian invasion of Ukraine, events related to China, or other geopolitical developments. As well, the prices of SMID stocks generally are lower than the prices of large-caps, with the P/E ratio on the Russell 2000 Small-Cap Index of 13 compared to a trailing P/E of 25 for the S&P 500. Finally, there are long stretches in the record books when SMID stocks have outperformed large-caps. From 2003-2021, for example, the Russell 2000 Index had climbed 450%, compared to an advance of 330% for the S&P 500 index. Here are the stocks with market caps below $20 billion that are on the Argus BUY list and recently were added to Argus' Mid-Cap Theme Model Portfolio.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

'Green Shoots' from the Fed

Monday Tee Up: Let the Shopping Begin

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

Stocks fell on Tuesday morning on concerns about more weak economic data from China, along with unexpected interest rate cuts by the Chinese central bank, and potential downgrades of several major U.S. banks by Fitch. Retail sales data were stronger than expected. The Commerce Department said that U.S. retail sales rose 0.7% in July, up from 0.3% in June and above the Reuters consensus forecast of 0.4% growth. The Dow fell 0.7%, the S&P 0.7%, and the Nasdaq 0.6%. Crude oil fell nearly 2% to $81 per barrel, while gold traded near $1942 per ounce.

Stocks were mostly higher on Monday morning amid hopes for a debt ceiling deal, with negotiations between the White House and Republican congressional leaders set to resume on Tuesday. Investors will also weigh new retail sales data on Tuesday along with earnings from Walmart, Target, and other major retailers later this week. The Dow fell 0.1%, the S&P rose 0.1%, and the Nasdaq rose 0.5%. Crude oil rose nearly 2% to $71 per barrel while gold rose $2 to $2022 per ounce.

Monday Tee Up: Barrage of Retail Earnings

Stocks slumped throughout 2022, as the S&P 500 entered a bear market in June and closed 19% lower for the year. Value stocks generally outperformed during the year, as the Dow Jones Industrial Average fell 9% while the Nasdaq Composite dropped 33%. The leading sectors were value-oriented, such as Energy, Utilities, Consumer Staples, and Financial Services. The average stock in the Argus Universe of Coverage declined 13% during the year, and the median stock declined 15%. The average BUY-rated stock dropped 11%, while the average HOLD-rated stock fell 17%. Will investors continue to favor value in 2023? Will high inflation drive continued outperformance in Energy?

While the S&P 500 is at a precarious short- to intermediate-term price level, the Nasdaq is at a hazardous long-term level. The index is back below (slightly) its 50-month average, which has acted as support at every key low (2010, 2011 2016, 2018, and 2020) since the secular bull market started in 2009. The Nasdaq is sitting on its lower trendline of its bullish channel going back to 2010/2011. Looking at the weekly chart, the index looks like it is tracing out a bearish wedge, which is a continuous pattern based on the current trend.

Stocks fell on Monday morning at the start of the holiday-shortened week, led by sharp losses in Energy and Consumer Discretionary stocks. Disney shares rose 7% after the company announced that former CEO Bob Iger would return to the top job, replacing Bob Chapek, who had served as CEO for less than three years. The Dow fell 0.3%, the S&P 0.6%, and the Nasdaq 1.0%. Crude oil fell $5 to $75 per barrel, while gold fell $18 to $1736 per ounce.

Another "Fed Day" is here, with the FOMC expected to raise the federal funds rate by 75 basis points (bps) for the fourth consecutive time since June 16. Assuming that happens, it will push the target rate to 3.75%-4%. Since March 17, only 7.5 months ago, the Fed will have raised the funds rate by 375 basis points. Of course, when you start late and from 0%, the current action shouldn't be much of a surprise.

West Texas Intermediate (WTI) ran to $88.90/barrel late Thursday afternoon, up significantly from last weeks' low of $76.25. Crude oil quickly reclaimed the key $85 area, where some major pieces of support exist. In addition, crude has broken the bearish trendline off the peak since mid-June. However, there is another downward sloping trendline off the peaks since July 8 that sits at $91. Chart resistance starts at $93 and runs up to $100, with a lot of additional resistance above that range.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

GDP Negative for Two Consecutive Quarters

Marathon is an independent exploration and production company primarily focusing on unconventional resources in the United States. At the end of 2021, the company reported net proved reserves of 1.1 billion barrels of oil equivalent. Net production averaged 347 thousand barrels of oil equivalent per day in 2021 at a ratio of 70% oil and NGLs and 31% natural gas.

Stocks finished lower in a volatile session on Thursday as investors continued to focus on inflation, the impact of Fed rate hikes, and weak guidance from major companies. On the employment front, the Labor Department said that first-time claims for state unemployment benefits rose to 218,000 for the week ended May 14, up from a revised 197,000 a week earlier and above the consensus estimate of 200,000. The Dow fell 0.75%, the S&P 0.58%, and the Nasdaq 0.26%. Crude oil traded near $111 per barrel, while gold rose $25 to $1841 per ounce.

Stocks stumbled early in 2022. Growth stocks were the weakest, as Technology, Communication Services, and Consumer Discretionary underperformed. Leading sectors tended to be value-oriented, including Energy, Financial, and Utilities. The average stock in the Argus universe declined 2% in 1Q22, and the median stock declined 4%. The average BUY-rated stock dropped 3.2%, while the average HOLD-rated stock gained 1.4%. Will investors continue to favor value? Will high inflation drive continued outperformance in Energy and Materials? Given interest rates that remain historically low, we expect growth stocks to outperform over time and believe that 2022 simply may be the one-in-five years that value leads. Investors seeking value are encouraged to focus on dividends and yields in the 3%-4% range. Our current Over-weights sectors are Energy, Financial, Healthcare, Industrials, and Materials.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

Stocks fell on Tuesday morning as Russia escalated the crisis in Ukraine by sending troops into two Eastern breakaway regions. Meanwhile, consumer confidence data fell to a five-month low. The Conference Board said that its consumer confidence index fell to 110.5 in February from 111.1 in January, though the reading was slightly above the Reuters consensus forecast. The Dow fell 1.0%, the S&P 0.8%, and the Nasdaq 1.3%. Crude oil rose to nearly $93 per barrel, while gold traded near $1900 per ounce.

Investors wrapped up a quiet final week in 2021 with a modest loss for the S&P 500. But that hardly dented a strong year for stocks, when the S&P 500 climbed almost 27%. The average stock in the Argus Universe of Coverage rose 24% during the quarter, and the median stock advanced 36%. The average BUY-rated stock increased 28%, while the average HOLD-rated stock gained 15%. Will investors continue to favor value in 2021? Will small-caps reverse their recent weak trend? Given low interest rates, we expect growth stocks to resume outperformance over time. Investors seeking value are encouraged to focus on dividends and look for yields in the 3%-4% range. As for small-caps, the promise of the vaccine is encouraging for these companies, which typically don't have the gilt-edged balance sheets of large-caps and are thus more dependent on a strong U.S. economy. Small-cap valuations remain depressed, and this group looks to offer value into 2022.

Stocks edged higher on Friday morning, led by the Technology and Communication Services sectors. Johnson & Johnson announced that it would split into two companies, one focused on pharmaceuticals and the other on consumer health products. On the employment front, the Labor Department, in its monthly JOLTS report, said that U.S. job openings slipped to 10.4 million on the last day of September, down from 10.6 million a month earlier but above the Reuters consensus forecast of 10.3 million. The Dow rose 0.1%, the S&P 0.3%, and the Nasdaq 0.4%. Crude oil traded near $81 per barrel, while gold fell slightly to $1864 per ounce.

Stocks were mixed on Wednesday morning as investors weighed new consumer price data. The Labor Department said that its consumer price index rose 0.5% in July, down from 0.9% in June and in line with the Reuters consensus forecast. Consumer prices also rose 5.4% from the prior year, slightly above the consensus forecast of 5.3%. The Dow rose 0.5%, the S&P was flat, and the Nasdaq fell 0.6%. Crude oil traded near $67.50 per barrel, while gold rose $20 to $1752 per ounce.

Stocks rose on Thursday morning after three days of losses, led by the Technology and Consumer Discretionary sectors. On the employment front, the Labor Department said that first-time claims for state unemployment benefits fell to 444,000 for the week ended May 15, down from 478,000 a week earlier and slightly below the Bloomberg consensus of 450,000. The Dow rose 0.6%, the S&P 0.8%, and the Nasdaq 1.4%. Crude oil fell to $63 per barrel, while gold traded near $1879 per ounce.