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In his Daily Market Notes report to investors, while commenting on the Fed, Louis Navellier wrote:
More Aggressive Fed?
CPI came in hot, and the market is pulling back hard.
Hopes for confirmation of peak core inflation have been crushed. Core CPI was 6% year over year, 0.6% sequentially. Virtually every component was higher.
Impactive Capital’s Lauren Taylor Wolfe Presents Thesis For Wex At Sohn Investment Conference
It’s virtually impossible to read an article on investing that doesn’t mention inflation. Investors would do well to look for companies that will benefit from an inflationary environment, and one sector that should benefit is payment processing and credit card companies. At the Sohn Investment Conference, Lauren Taylor Wolfe of the activist hedge fund Impactive Read More
Q1 2022 hedge fund letters, conferences and more
The market reaction has been swift and severe. Indexes are down +2% across the board, the NASDAQ -3%. The US 10-year spiked 7bps to 3.11%, the 2-year +15bps to 2.96%, on fears that the Fed will become even more aggressive.
Spiking Fear
Adding fuel to the fire is the Michigan Consumer Sentiment report came in very weak. The inflation numbers put even more pressure on high-value stocks who will now get hit on further P/E multiple compression and expectations for earnings cuts.
Today, it’s all red ink; quality stocks, bonds, commodities, gold, crypto, and even energy as fears rise on recession risks. When you see mega-tech getting hurt worse than the indexes, you know the fear level has spiked.
Red Morning
The VIX is up 11% to 29 which is still far from a capitulation number. Hopefully, nimble investors lightened up on high-value stocks during the recent rally.
This morning is offering new discounts in strong names but keep some powder dry for the yet-to-come capitulation trade.
Coffee Beans
In addition to the humanitarian catastrophe, the war in Ukraine has also triggered an inflation crisis that is affecting people all over the world. The impact of rising consumer prices is being especially felt in Europe and countries neighboring Ukraine. The expected inflation rate is highest for Lithuania at 15.6%, compared to 5.9% for the U.S. Source: Statista. See the full story here.
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