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Morning Commentary


By Charles Payne, CEO & Principal Analyst
1/11/2023 9:38 AM

Whistling past the graveyard, investors were cautious about the rug being pulled at any moment. Face it, Powell & Co. has everyone shaken up. It turns out Powell decided it would be bad form to crush the U.S. stock market from a foreign country.

Ten of eleven sectors finished the session higher.

Good Start to 2023

So far, so good for the stock market, where ten of eleven sectors are higher for 2023. It’s an eclectic board for sure with Materials (XLB) the top performer, followed by Communication Services (XLC) and Consumer Discretionary (XLY).

Industries on the Roll

Drilling deeper, most industry groups are higher with entertainment and semiconductor equipment in front.

Good Omen

Over the course of the past seventy years, the kind of start the market has seen thus far hints at a strong year.

Up more than 1% in the first five trading days has seen the market rally 13.9% for the rest of the year. This has been the case 79% of the time.


Now we wait

With the Fed in focus, it all boils down to the Consumer Price Index (CPI) report. The number has been coming down, and there is a ton of anecdotal evidence.

Small Business Big Clues

Another decline in small business optimism landed the index to 89.8. Compensation edged up ever so slightly, but it’s the drop in price plans that could be a harbinger for the CPI.

The correlation between the National Federation of Independent Business (NFIB) price plans has lurched into freefall, and if history repeats itself, we could see the CPI swoon quickly.

Today’s Session

The market has mostly been making time, as investors rubbernecked the latest fiasco in air travel.  It’s really a shame, because everyone is living YOLO and traveling, as they take advantage of working from home (wink).

Ironically, Boeing (BA) could be the stock of the day, as the 737 Max is scheduled to fly in China on Friday.   

The market has momentum, but there might be caution ahead of the CPI report tomorrow morning. 

I love the sector wheel show above. I can assess sector and subsector performance in under a minute. Where can I find that most excellent sector performance wheel? That is a major time saver. < Here is the link: https://www.sectorspdr.com/sectorspdr/tools/sector-tracker

William Hall on 1/11/2023 5:55:54 PM

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