Yeah, that was a pretty long title now, wasn’t it. So, a pretty good week for the market, a meh week for me. I sort of flipped my predictions around. KLA Corp did really well and UNH flopped. However.. my unofficial prediction of Adobe going up still happened so I will count that as a win. That prediction is official now by the way. AI(which I predicted would do worse) boomed and the market was really optimistic about its prospects, sparking an early rise from NASDAQ, which eventually pushed the entire market into a good mood, seeing pretty much all green. Economic data throughout the week showed a cooling market, making investors believe that a rate cut was going to happen, and it did end up happening on Wednesday, as the Fed cut interest rates by 0.25%. I know that sounds small, but it is a lot. If the Fed cut rates more, inflation would surge and I know many of you guys don’t want to be coughing up 9 bucks for a dozen eggs. Because they finally cut rates, as many of you would guess, the market continued surging. Investors were extra happy because the Fed did not derail their plans to cut rates after a not so great CPI report the week before this one. This all led to NASDAQ and the S&P 500 breaking more records than prime LeBron. Even Dow joined the party and broke the 46,000 mark for the first time. However, by Friday, the indexes sort of cooled.
Riser
Micron Technology- I know that I was talking about a potential fall off for tech, but considering this is largely AI, I don’t think Micron will be affected much. It is reporting earnings, and considering how well NVIDIA did last week, if it gives a positive outlook, it could do really well. Again, with this whole H1-B thing, it might not jump up like crazy, but it will definitely go on the upwards path.
Faller
Lennar- The housing market is generally very sensitive, and if you have read the news or even this blog recently, you would know that it has been significantly below par. It is probably the worst market to buy a house in for a very long time. The rate cut definitely will help companies like Lennar because people are more likely to buy a house but it isn’t like people are suddenly flocking to make renovations now. KB Home is set to report earnings, and if they do not do well, it could trigger the market to look upon housing more negatively. After all, competitors in this industry usually deal with the same costs as other, and a poor report for KB Home will mean investors will think the same for Lennar. Well, that is it for this week’s edition of the Market Memo. See you guys next week!
Market Memo 