Morning Market Feed, June 10th

I hope you enjoyed the weekend as much as I did, and are rejuvenated for a new week in the markets. Futures are still looking sleepy with now much going on, although we did see the 10Y-Yield jumping 3.4% last Friday. I also promised an overview of the Growing Quality Portfolio which I will go over today. Let’s jump straight into it!

- The Growing Quality Portfolio
I have previously called it the social media portfolio, but will refer to it as the Growing Quality Portfolio going forward. As it became a rather large article, I decided to link to it instead of pushing it through the newsletter. This means that you can read it here if interested. I will also try to communicate the goal of this portfolio better going forward, so let me state the philosophy, and goal here. I want to buy high growth stocks, which need to have their volatility and risk compensated by more mature, and stable growth stocks. This strategy will have large upside, and has the challenge of protecting downside. The goal of this portfolio is to show what can happen when funds are added continuously, and thoughtfully.

- The 10Y Yield increase
Last Friday saw the release of jobs data, which was expected to come in below expectations, just like all other jobs data point came in throughout the week. But this was the big official one, and was supposed to confirm the idea that the jobs market was slipping, which would result in the FED needing to cut interest rates. As said last week, institutions have falen in love with the idea of rate cuts, but when they happen, I’m not expecting too much of a favorable reaction to it, as it would mean a deteriorating economy. Anyway, last Friday, quite the opposite happened. Jobs data came in way hotter than expected and as a result, the 10Y-Yield which was falling quickly in the day prior, bounced back up by 3.4%, which then resulted in interest-rate-sensitive stocks to fall flat on their face. For me, this was Enphase, which fell by 7.2%, although the stock is still up 12% in the last 4 weeks.

- What will I be looking for in the coming week?
Adobe will be reporting earnings coming Thursday. This is something very important as the stock has been falling since February, and will provide an update on the AI threath. I will be listening to it carefully, look at the details, and of course, give my thoughts of it.

On Wednesday, we will also see a new CPI report with expectations being an inflation rate of 0.2% month-over-month, and 3.4% year-over-year. Core inflation is expected to coming in at 0.3% MoM, and 3.5% YoY. This is followed by the interest rate decision, which is not expected to change, but the following Press Conference will be important to judge the path going forward.

Friday will see the Michigan Consumer Sentiment Preliminary number coming in, which is expected at 73. I will explain this number better in Friday’s newsletter.

That was it for today, I hope you have a good day and markets will have another good week.