AlphaBetaStock’s Report (Premium Edition) 07-05-2022

KEY DRIVERS & CALENDAR

TIP – This is a brief bullet-point summary. It is a tool that gives investors and financial advisors a fast and simple list of what to news and market data watch that may move the markets.

Ukraine Conflict (Ukraine Running Out of Ammo, Losing Ground, Peace Agreement Possible?)Rising Inflation, Recession & Stagflation Fears Wednesday, July 6 – JOLTs Job Openings (May)Friday, July 8 – Unemployment Rate (June)

On July 6, the same day as the release of the minutes from the most recent Fed meeting, the EU will publish its updated economic estimates. On Friday, July 8, the US will closely watch the June employment data. Investors in the United States will benefit from an extended weekend thanks to Monday being a national holiday on July 4.

S&P 500

S&P 500 SECTORS

Tip: Use this section to know various sectors' performance, and weight portfolios, or look for trades. Modern portfolio theory stresses the importance of diversification, but recently several sectors like technology have outperformed others like utilities. This is also a way to narrow the sectors to find investment opportunities.

WEEKLY MACRO: The Fed, Supply Glut, and Recession Fears

Last week, the financial markets continued a bear trend with a few up bumps, only to fall down shortly after. A 20-year record of -29.5 percent for the Nasdaq, for instance, makes the index performance for the first half of the year very BEARISH. Some market analysts are suggesting this may be a good time to start looking at buying quality tech stock like Apple (APPL), but I am still not sure if we have hit the bottom. More importantly, the risks of a recession could hurt Apple as consumer spending could drop.

The first set of quarterly results, scheduled to be released in two weeks, will allow us to compare the goals we established a few weeks ago with the state of the economy now, so caution is still the watchword. At the start of the year's second half, there is, therefore, still a lot of uncertainty. Still, there are also opportunities for good companies whose valuations have automatically become once again reasonable.

The big question for investors is, "Are central banks exaggerating the prospect of rate increases to avoid implementing them fully?"

Investors appear to like this scenario, which supported the comeback earlier this week. But the most significant risk is still the worry of a recession and its effects. The health of the...

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