Friday’s PPI inflation report came in above projections.
- 0.3% month-over-month v 0.2% projected
- Year-over-year, the rise was 7.4% overall
- Exclude food and energy, and prices are up just 4.9%
These readings are the lowest we’ve seen since the spring of 2021.
And while the numbers were slightly higher than some may have hoped. The downtrend is still intact…
After these figures dropped, indexes opened red, traded in the green intraday, but settled near their lows. The losses were modest…
- Dow Jones -0.9%
- Nasdaq -0.7%
- S&P 500 -0.7%
- Russell 2000 -1.2%
A quote from the report…
“About one-third of the November rise in the index for final demand services can be traced to … investment advice and related services.”
- This indicates that people are still looking to invest in the uncertain economy.
Sector Round Up
10 of 11 sectors ended Friday in the red.
The lone winner…
- Communication (XLC) +0.3%
At the bottom…
- Energy (XLE) -2.4%
- Healthcare (XLV) -1.3%
- Materials (XLB) -1.0%
Athletic apparel company Lululemon (LULU) fell 13% after reporting high inventory and lowering its forecasts for next year.
- The company shed $6 billion in market cap
- Analysts are now “mixed” in opinion
- The luxury retailer’s stock had outperformed the market in 2022 before Friday’s decline
This week will be driven by news much more than technicals.
However, it’s worth noting the VIX popped this morning.
- It remains below the key level of 25.
- It’s higher despite futures trading in positive territory.
Your take-home… The market expects lots of fireworks this week. The direction remains to be seen.
- RSI levels are all neutral
- The Put-to-Call Ratio is oversold
Here’s your week’s outlook…
- Headline CPI inflation data release at 8:30 am.
- Sam Bankman-Fried, the former CEO of crypto exchange FTX, is scheduled to give testimony to Congress
- FOMC meeting convenes
- FOMC concludes the latest interest rate drops at 2 pm.
- Fed Chair Powell speaks at 2:30
- The final triple witching of 2022
We’ll begin scanning for stocks that fit the free lunch strategy starting today. We’ll share our picks by Monday, 12/17.
*CJJD support at $3
*USEA support at $4
*BIVI support at $8
*CLRO on watch
*BBW support at $25.60
BAND support at $24
SMMT on watch
ACLX support at $24
REPL on watch
PHR support at $29
RCUS support at $30
^CROX support at $95
^RYAM support at $8
^PRQR support at $1.40
TOUR on watch
Secondary watchlist, float over 100 million
YEXT support at $6
GEO support at $11
MOMO on watch
EDU support at $30
MNSO support at $12
MLCO resistance at $12
WDH support at $2.10
RLX support at $2.50
TME on watch