Premarket: Apple is red

From the Wall Street Journal's "Market Recovery Hinges on Quick Inflation Drop" posted early Monday:

Behind this year’s improved start for markets lies a broad wager that inflation will soon post a once-in-a-generation decline...

Hopes for a quick return to 2% inflation have encouraged bets that the Federal Reserve will pause and even reverse its interest-rate increases this year. Rate increases pummeled stocks and bonds in 2022, and a possible respite has sent both higher in January. The rally has extended to some of the riskier assets that had stung investors hardest last year, such as bitcoin and the ARK Innovation exchange-traded fund, known for its focus on fast-growing tech companies.

Many Wall Street strategists, however, are warning that a painless end to elevated inflation will be difficult to achieve. Previous episodes of inflation suggest that it rarely falls as fast as markets are now forecasting that it will in the absence of a serious recession...

Avoiding a serious downturn while inflation falls quickly would be a “Goldilocks scenario,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. “Pretty much everything would have to go right,” she said.

For now, markets are holding relatively steady.

Charts: Yahoo!Finance sees a neutral commodity-channel-index pattern. Max pain starts the week at $135 (up $2) with a call mountain at $145 (up $5) and a put peak at $125 (down $15).

6 Comments

  1. Gregg Thurman said:
    Does anybody know why there is so much green around the world? I haven’t seen this much green in the world’s indices in a loooong time. Even the Moscow exchange is up (normally bounces in a tight range) more than usual.

    Whatever it is/was, it has significantly impacted the world’s markets.

    0
    January 23, 2023
    • Jerry Doyle said:
      @Gregg Thurman: Other than the markets anticipating positive news from Apple later this week on earnings and guidance (affecting Apple’s stock price) the other factors affecting markets this morning are “…. semiconductor stocks and [shares of Tesla and Apple gained] on hopes that a reopening in China would boost their businesses. Both big tech names recently grappled with temporary shutdowns and blows to production as the country dealt with surging Covid-19 cases…..Investors weighed the possibility that the Fed is preparing to slow the pace of its inflation-fighting rate hikes. Economic data released last week showed a decline in wholesale prices and retail sales, along with commentary from central bank officials, seemed to signal a slowdown.”

      0
      January 23, 2023
  2. Gregg Thurman said:
    Investors weighed the possibility that the Fed is preparing to slow the pace of its inflation-fighting rate hikes.

    Hopium.

    0
    January 23, 2023
  3. Greg Lippert said:
    From Apple Insider:
    “Details of how the new system will work are still being worked on. The intention is to begin rolling it out in the second half of 2023.”

    This has 0% chance of success.

    2
    January 23, 2023

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