Charles Payne's Market Commentary

Morning Commentary

PAUSE TO ASSESS

By Charles Payne, CEO & Principal Analyst
5/31/2023 9:44 AM

Yesterday, the S&P 500 closed +0.0029%, which suggests tectonic plates are pushing to the point of something major happening very soon.

Something monumental.

There was some profit-taking (we also sent out several alerts, so check with your rep and please update your Portfolio tracker). Still, the real story was the continued slide in crude oil, as West Texas Intermediate (WTI) trades back under $70.00 a barrel. Consumer Staples (XLP) took it on the chin hard, and other ‘havens’ stumbled on the session.

Heat Map

Lots of red on the screen as decliners led advancers on the New York Stock Exchange (NYSE) and the NASDAQ Composite.

NYSE: 1,408 advancers, 1,574 decliners
NASDAQ: 2,023 advancers, 2,422 decliners

Chip names dominated the biggest advancers list, which also saw bottom fishing.

Interpretations of the Economy

The Dallas Fed Manufacturing Report was a disaster. General Business Activity -29.1 against the consensus of -18.0, and various components display major pressure.

Some Highlights:

Food manufacturing

Order volume has stalled recently.
We clearly are moving into a period of stagflation.

Machinery manufacturing

We are seeing a massive slowdown in business activity.

Paper manufacturing

We are seeing all indications of a continued slide in demand (three quarters now).

Primary metal manufacturing

Business is slowing down. That is certain.
The building and construction industry remains significantly off, primarily residential.

Consumer Confidence

Consumer Confidence was better than the consensus but dipped to a six-month low, as expectations are on the cusp of falling through a trapdoor.

But the Street sees a greater chance of a 25-basis points (bps) rate hike in two weeks.

NVDA & $1 Trillion Market Cap Club

By now, you know this kind of stuff isn’t that interesting to me other than being an amazing milestone. I’m much more concerned about the next move. Nvidia (NVDA) is the name to add to your ‘buy the dip’ list for the foreseeable future.

Portfolio Approach

We took profits on 2 positions in our Hotline Model Portfolio yesterday. To subscribe to our premium Hotline service, contact your account representative or email Info@wstreet.com to get started today.

Today’s Session

Today has that anti-climactic ‘sell the news’ vibe, which is fine and maybe overdue. The debt ceiling deal moves closer to becoming law. It is a terrible deal filled with contradictions and loopholes. There is no real fiscal restraint, and it makes the entire drama a bigger farce than usual.

Nevertheless, the market returns its attention to the Fed, which is now seen hiking this month’s FOMC gathering.

Watching airlines after American Airlines (AAL) upped its guidance.

Log In To Add Your Comment

PREVIOUS COMMENTARY

9/28/2023 1:34 PM	Changing the Course
9/28/2023 9:40 AM	A PAUSE IN THE PULLBACK
9/27/2023 1:45 PM	Tense Session
9/27/2023 9:39 AM	KEY TEST OF SUPPORT AHEAD
9/26/2023 1:21 PM	Typical Tantrum
9/26/2023 9:50 AM	A LITTLE SPUNK
9/25/2023 1:59 PM	Yields On the Spotlight Again
9/25/2023 9:42 AM	GREEN LEAVES
9/22/2023 1:42 PM	Challenging Week
9/22/2023 9:44 AM	NOT THE END OF THE WORLD
9/21/2023 1:33 PM	First Casualties
9/21/2023 9:46 AM	WAS IT SOMETHING HE SAID?
9/20/2023 1:32 PM	Ready to Pounce
9/20/2023 9:54 AM	LOOKING FORWARD TO THE DOT PLOT
9/19/2023 1:23 PM	Red Letter Day
9/19/2023 9:40 AM	AMERICAN EXCEPTIONALISM
9/18/2023 1:32 PM	Tepid Volume
9/18/2023 9:44 AM	Lots of Angst
9/15/2023 1:33 PM	Lackluster Session
9/15/2023 9:44 AM	KEEPING POWELL OUT OF THE GAME
9/14/2023 1:32 PM	Arm IPO Pops in its debut
9/14/2023 10:08 AM	CONSUMER CHECKUP
9/13/2023 1:33 PM	Mixed Bag
9/13/2023 9:35 AM	MOUNTING TENSION
9/12/2023 1:49 PM	Big Move in Oil
More commentary archives