The path to resolution of the U.S.-Israeli/Iranian War, has become more complicated, more difficult to navigate. Negotiations are at a standstill as both sides jockey for clarity on strategic issues. According to Taznim, a news service tied to the Islamic Revolutionary Guard Group said “there are basically no negotiations with Americans at the moment.” Taznim also reported that upcoming talks in Islamabad, Pakistan will be difficult , almost impossible to define and negotiate specific issues due to the multiple factions of political leadership presently emerging.
Semiconductor stocks led by Intel led all techs, soaring up 24% on Friday, leading the PHLX semiconductor index “to its 18th straight gain, its longest on record,” according to Dow Jones Market Data. Both the S&P 500 and Nasdaq Composite benefited, each again hitting new record highs. The Dow Jones Industrial Average, laden with blue-chips, struggled, finishing just above flatline, as techs ‘ruled the day.’ The University of Michigan Consumer Sentiment Survey, released Friday “dropped to its lowest level in its 50 years of history.” The survey, a good barometer in gauging the buying tendencies of the U.S. consumer, has for years given economists and strategists economic direction. Oils were mixed as Brent Crude topped $105.33 a barrel while U.S. crude fell to $94.40 a barrel at Friday’s close. The two-year Treasury note yield fell from 3.824% to 3.775% while the 10-year Treasury note dropped from 4.823% to 4.308%. While both notes slid, stocks appreciated.
Markets opened mixed on Monday, gradually getting a foothold as the session turned slightly positive, with the S&P 500 and Nasdaq reaching record highs, up 0.1% and 0.2% respectively. The blue-chip Dow Jones struggled finishing 0.1% lower, off 63 points. “The consumer is still a little muted,” said Procter & Gamble’s chief financial officer last week. According to FastSet S&P 500 companies 1st quarter results are “on track to report their highest net profit in more than 15 years.” Brent Crude rose again, up 2.8% to $108,23 a barrel. Retail gasoline prices are now on an upward run, near $4.49 a gallon, and very likely to rise daily as the Strait of Hormuz situation is in a lock-down by the U.S. Michael Rosen, chief investment officer at Angeles investments said: “the rise in energy prices affects people significantly. It has an outsize effect on those earning lower wages.”
Artificial Intelligence leader, OpenAl released 1st quarter results, with “missed revenue and user expectations.” Most technology and related stock were deeply affected, many falling 4% or more and more, traumatizing the markets on Tuesday. The company fell 9% in Tokyo trading, a heavily traded stock there. Adding to the impactful news, Chief Financial Officer Sarah Friar expressed concerns “the company might not be able to pay for future computing contracts if revenue doesn’t grow fast enough.” She has consistently issued warnings of OpenAl’s aggressive growth desired by Altman and taking OpenAl public by year’s end. An OpenAl spokesman denied rumors that a rift between Altman and Friar exists. The heavy-tech Nasdaq fell 0.9% while the S&P 500, also with tech exposure, was down 1.3%.
Inflation is beginning to worry investors and traders, as Wednesday’s market was swayed downward by major upward moves by oil, with Brent Crude up another 6.1% to $118.03 a barrel. Energy and Inflation concerns and a lingering Middle East Conflict can not derail the strong U.S. economy as the consumer continues to…pay
RUMBLINGS ON THE STREET
Dory A. Wiley, president and CEO of Commerce Street Holdings, Dallas Barron’s – ”We’re still on track to have double digit earnings growth this year. The market is resilient.”
Michael Rosen, chief investment officer at Angeles, WSJ – “What drives the market is profits, period. Everything else is secondary.”
Clayton Allison, portfolio manager at Prime Capital Financial, WSJ – “Anything that is adjacent to software or SaaS as a whole is getting dragged. Right now, software is in the penalty box.”
Lori Van Dusen, CEO of LVW Advisors, in Pittsford, N.Y., Barron’s – “Warsh is a credible choice, and he is not in Trump’s pocket.”
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