Good morning. Happy Friday.
The Asian/Pacific markets leaned to the upside. China, Hong Kong, Taiwan, New Zealand, Singapore and Thailand did well; Japan, South Korea and the Philippines were weak. Europe, Africa and the Middle East lean to the upside but are mostly quiet. Denmark, Poland, Greece and the Czech Republic are up; Norway is down. Index futures in the States point to a flat open for the cash market.
————— BLOG: Studies Based on January’s Performance and the November – January Quarter —————
The dollar is up. Oil and copper are up. Gold and silver are up. Bonds are down. Bitcoin is up.
Stories/News from Seeking Alpha…
Spreads and payouts
It’s that time of the year again. Wings, dips and hot dogs are on the menu this weekend as the Kansas City Chiefs take on the Philadelphia Eagles in Super Bowl LIX. Households across the U.S. will huddle around screens, and many have already been betting on the big game, with legal wagers expected to come in at a record $1.39B, according to the American Gaming Association. Since a Supreme Court decision in May 2018, 38 states, along with the District of Columbia, have authorized some form of in-person or online sports betting.
Snapshot: The $1.39B number does not account for office pools, Super Bowl Squares, offshore operators, illegal bookies, etc., which are likely to make up the majority of all bets on the big game. It also excludes prediction market sites like Kalshi and Crypto.com, as well as Robinhood (HOOD), though the latter platform pulled its Super Bowl betting contracts this week following a CFTC request. It all means that sportsbooks are facing a crowded field of competition, along with sweepstakes betting and fantasy sports.
For investors in the sector, how the game shakes out could have significant implications for Q1 earnings reports because sportsbooks, like DraftKings (DKNG) and FanDuel (FLUT), have embedded liability on certain results. A low scoring game and a Chiefs victory could lead to a hold rate of about 22% due to a huge amount of betting on the points scored going over the 48.5-point line and with most sportsbooks having more exposure on the moneyline to a win by the Eagles. Parlays and prop bets could also impact the Super Bowl hold rate if some of the long-odds bets hit.
Stock watch: Most sports gambling shares that have performed well over the past year haven’t been the established players. Outsized returns have been recorded at online operators Rush Street Interactive (RSI) and Gambling.com (GAMB), as well as data companies Sportradar (SRAD) and Genius Sports (GENI). “Most companies in this industry are growing revenue by two digits on a year-to-year basis,” writes SA Analyst Given Mahlangu, while Investing Group Leader Daniel Jones highlights the lucrative relationships with major sports leagues and sportsbooks.
What else is happening…
Nonfarm payrolls expected to show ‘still healthy’ labor market.
Electric-truck maker Nikola (NKLA) weighs bankruptcy filing.
Amazon (AMZN) is going all in on AI and its cloud platform.
Oil dips as Trump renews pledge to drive down crude price.
Musk’s DOGE pouring federal data into AI to find spending cuts.
Key takeaways from Pinterest’s (PINS) earnings; stock soars.
OpenAI close to selecting additional data center sites in Texas.
TikTok blowback? e.l.f. Beauty (ELF) falls after dimming outlook.
Australia ‘losing on every front’ to Trump’s U.S. – Woodside CEO.
This ‘America First’ policy will have the biggest portfolio impact.
Today’s Economic Calendar
08:30 AM Employment Situation
09:25 AM Fed’s Bowman Speech
10:00 AM Consumer Sentiment
10:00 AM Wholesale Inventories (Preliminary)
12:00 PM Fed’s Kugler Speech
01:00 PM Baker Hughes Rig Count
03:00 PM Consumer Credit
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Good morning. Happy Thursday.
The Asian/Pacific markets were split. Japan, China, South Korea, Taiwan, Australia and Malaysia did well; India, Indonesia, Thailand and the Philippines were weak. Europe, Africa and the Middle East are posting solid gains. The UK, Poland, France, Turkey, Greece, South Africa, Finland, Hungary, the Netherlands, Austria and the Czech Republic are up more than %. Index futures in the States point to a positive open for the cash market.
————— BLOG: Studies Based on January’s Performance and the November – January Quarter —————
The dollar is down. Oil and copper are down. Gold is up; silver is down. Bonds are up. Bitcoin is up.
Stories/News from Seeking Alpha…
Raising cash
The clock is ticking for Treasury Secretary Scott Bessent and incoming Commerce Secretary Howard Lutnick to deliver a plan for the creation of the first-ever American sovereign wealth fund. An executive order signed this week will give them 90 days to map out funding mechanisms and investment strategies, as well as fund structure and the governance model. The aim here is to leverage returns to “promote fiscal sustainability, lessen the burden of taxes, and establish long-term economic security.”
Snapshot: Dozens of nations around the world already have sovereign wealth funds like Norway and Saudi Arabia, while the Biden administration also previously entertained the idea of starting such an investment vehicle. Even within the United States, 23 states maintain their own funds that control a total of $332B in assets. These can finance certain services or provide dividends, like the Alaska Permanent Fund, which uses oil revenues and invests in stocks and other traditional sectors.
Funds from the new U.S. sovereign wealth fund could be allocated to national development projects, like infrastructure and manufacturing hubs. It might also help in areas that are seen as critical for national security, like supply chain minerals, defense capabilities or nuclear fusion projects. Another idea floated by President Trump is using the new fund for a TikTok deal, with the popular short-form video app facing a potential ban.
How will it be capitalized? The U.S. is already $36T in debt, and sovereign wealth funds are usually set up by commodity-rich nations that run big surpluses. However, the federal government could look for additional ways to monetize the asset side of its balance sheet, as well as through natural resource reserves like oil and gas leases. Other ideas include selling stakes in Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC), or utilizing the hundreds of thousands of seized bitcoins (BTC-USD) used in illicit activity. Note that the fund’s creation would require an act of Congress and things can get controversial if funding is sourced through appropriations bills or new debt issuance.
What else is happening…
Not the Fed rate! Bessent and Trump focused on 10-year yields (US10Y).
Google (GOOG) (GOOGL) is latest on Wall Street to end DEI targets.
MicroStrategy (MSTR) rebrands after revealing $1B bitcoin impairment.
Breaking point? Sky-high egg prices prompt surcharge at Waffle House.
UnitedHealth (UNH) contacts SEC over Bill Ackman’s now-deleted post.
Industrial conglomerate Honeywell (HON) confirms three-way split.
Weak guidance from Ford (F) after continued losses for EVs.
Nissan CEO informs Honda (HMC) of intent to end merger talks.
China files WTO complaint over Trump’s ‘discriminatory’ tariffs.
Trade war fears: Gold sets another record on safe-haven demand.
Today’s Economic Calendar
07:30 AM Challenger Job-Cut Report
08:30 AM Initial Jobless Claims
08:30 AM Productivity and Costs
10:30 AM EIA Natural Gas Inventory
02:30 PM Fed’s Waller Speech
04:30 PM Fed Balance Sheet
05:10 PM Fed’s Logan Speech
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Good morning. Happy Wednesday.
The Asian/Pacific markets were split. Japan, South Korea, Taiwan, Australia, Malaysia and the Philippines did well; China, Hong Kong, New Zealand, Indonesia and Thailand were weak. Europe, Africa and the Middle East are split. Denmark, Switzerland, Spain and Italy are up; Poland, Turkey and Italy are down. Index futures in the States point to a moderate down open for the cash market.
————— Course: Guidelines to Successful Trading —————
The dollar is down. Oil and copper are down. Gold is up; silver is down. Bonds are up. Bitcoin is up.
Stories/News from Seeking Alpha…
Price and fair value
The last two weeks have started with fear and market selloffs, whether it be from DeepSeek or steep tariffs, but the recovery from these events has come almost as fast as they arrived. Over the last 48 hours, the S&P 500 (SP500) has recouped all the losses since the risk of North American trade war, returning to the 6,040 level. The Nasdaq 100 Index (NDX) is also stomping back to levels seen before the AI scare from China, and is only a 1.5% gain away from near-record territory.
Snapshot: The threat of tariffs still loom, and has even gone into effect on Chinese imports, yet the market appears to have dismissed these variables and possibilities. The same can be said about the release of DeepSeek, as well as many other closely watched economic reports over the past two years. Whether it was selloffs on hot inflation readings, payroll reports, or the Fed’s delayed pivot, markets have generally recovered somewhat quickly following initial knee-jerk reactions.
It also brings into focus the long-standing question of market efficiency. The hypothesis postulates that stock prices reflect all available information, so investors cannot beat broader stock market performance on a risk-adjusted basis over the long run. However, if an investor is willing to take on more risk, or has fundamental, technical or quantitative analysis to support their investing strategy, higher returns might be in store.
SA commentary: “Today’s capital markets are increasingly turning into a strange amalgamation of casinos and capital markets,” writes SA Analyst Cullen Roche. “On the one hand, you have the entities that are the greatest investment vehicles in human history. U.S. corporations are responsible for creating more wealth than any group of financial instruments ever. And on top of that, you have an increasing number of ‘securities’ being issued that don’t really serve any economic purpose and simply leverage the performance of those underlying entities for gambling purposes (single-stock leveraged ETFs, cryptocurrency ‘memecoins,’ and other fanciful sounding ‘hedging’ ETFs).”
What else is happening…
Key takeaways from Alphabet (GOOG) (GOOGL) results; stock dives.
Treasury grants ‘read-only’ access to payments system to DOGE staff.
Nissan (OTCPK:NSANY) likely to reject Honda’s (HMC) takeover offer.
Cruise cuts 50% of staff after integration with General Motors (GM).
Snap (SNAP) surprises Wall Street; AMD data center growth slows.
Trump’s Gaza proposal would see U.S. takeover of the Strip.
Berkshire Hathaway (BRK.B) raises stake in Sirius XM (SIRI).
Chipotle (CMG) targets up to 345 new restaurant openings this year.
Boeing (BA) lost over $2B on Starliner so far, flags risk of more losses.
Shopping on Shein, Temu could get costlier as U.S. ends trade loophole.
Today’s Economic Calendar
07:00 AM MBA Mortgage Applications
08:15 AM ADP Jobs Report
08:30 AM International Trade in Goods and Services
08:30 AM Treasury Refunding Announcement
09:00 AM Fed’s Barkin Speech
09:45 AM PMI Composite Final
10:00 AM ISM Services Index
10:30 AM EIA Petroleum Inventories
02:30 PM Fed’s Goolsbee Speech
03:00 PM Fed’s Bowman Speech
07:30 PM Fed’s Jefferson Speech
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Good morning. Happy Tuesday.
The Asian/Pacific markets mostly posted big wins. Japan, South Korea, Hong Kong, India and the Philippines did great. Europe, Africa and the Middle East are mostly up. Poland, Turkey, the UAE, Greece, South Africa, Hungary, Spain, Portugal and the Czech Republic are up; Finland is down. Index futures in the States point to a positive open for the cash market.
————— Course: Guidelines to Successful Trading —————
The dollar is down. Oil is down; copper is up. Gold and silver are up. Bonds are down. Bitcoin is down.
Stories/News from Seeking Alpha…
Emerging juggernaut
While Nvidia (NVDA) and other Magnificent 7 members have grabbed headlines over the past year, one AI player has stood ahead of the pack in terms of sheer returns. Palantir (PLTR) is up a whopping 514% in the last 12 months, and just took its next leg up in AH trading on Monday to top the $100 level for the first time. Stellar earnings from the AI software analytics company were responsible for the nearly 23% pop, while it projected bumper numbers for 2025 amid accelerating AI adoption.
You called it! Back in September 2024, subscribers to Seeking Alpha’s Wall Street Breakfast were asked to name the most unknown stock in the market poised for outsized returns. Palantir was the most popular reply – and that was when the stock was trading at $37. In the first week of the new year, WSB followed up with a survey on the best AI stock to watch in 2025 – and Palantir was the top favorite again, as it changed hands at $70. At those levels, investors who bought in would have seen gains of 178% and 47%, respectively, over the span of just months or weeks.
Palantir (PLTR) also recently joined both the S&P 500 (SP500) and Nasdaq 100 (NDX), giving it exposure to broader market ETFs and products. Meanwhile, a deepening relationship with the U.S. Department of Defense resulted in government sales exploding 45% to $343M in the latest quarter, while U.S. commercial revenue skyrocketed 64% to $214M. Palantir’s Artificial Intelligence Platform (AIP), which helps companies integrate complex AI models for analytics and insights, has played a pivotal role in inking the new contracts, while efficiency initiatives and likely increases in defense spending by the Trump administration should ring the register for the foreseeable future.
“With the proliferation of AI models, the raw AI labor supply is exploding,” Chief Revenue Officer Ryan Taylor said on the earnings call. “While everyone else is focused on the model supply side, we’re transforming AI into a measurable stream of high-value finished goods and services. The result, the rapid emergence of quantified exceptionalism for organizations able to unlock the potential of these commoditized models through AIP.”
More from the C-Suite: “We are still in the earliest stages, the beginning of the first act, of a revolution that will play out over years and decades,” CEO Alex Karp wrote in a letter to shareholders. “This is not an incremental advance or marginal acceleration of our business. This is a new phase. The business we have built has now developed its own internal momentum and strength, its own interior life and forms of untamed organic growth, with the output that we are seeing far surpassing what we are investing. A software juggernaut has indeed emerged.”
What else is happening…
WSB survey results: Broad tariffs on pause; not so much support.
China up next: Levies still a threat and a Google (GOOGL) probe.
State Farm seeks emergency rate hikes in California after LA fires.
Intuit (INTU) in focus as Musk says IRS Direct File program ended.
Tariff uncertainty prompts Diageo (DEO) to suspend guidance.
U.S. sovereign wealth fund to be created – will it save TikTok?
OPEC+ does away with U.S. government data for oil policy.
Salesforce (CRM) to cut 1,000 jobs, but hiring for AI sales roles.
Trump wants Ukraine’s rare earth minerals in return for U.S. aid.
Will a 1798 wartime law be invoked to speed up deportations?
Today’s Economic Calendar
10:00 AM Factory Orders
10:00 AM Job Openings and Labor Turnover Survey
11:00 AM Fed’s Bostic Speech
02:00 PM Fed’s Daly Speech
07:30 PM Fed’s Jefferson Speech
—————
Good morning. Happy Monday. Hope you had a good weekend.
The Asian/Pacific markets mostly posted big losses. Japan, South Korea, Taiwan, Australia, New Zealand and Indonesia got hit hard. Europe, Africa and the Middle East are mostly down big. The UK, Denmark, Poland, France, Turkey, Germany, Greece, Finland, Norway, Hungary, Spain, the Netherlands, Italy, Austria, Sweden and the Czech Republic are down more than 1%. Index futures in the States point to a big gap down open for the cash market.
————— Course: Guidelines to Successful Trading —————
The dollar is up. Oil is up; copper is down. Gold and silver are up. Bonds are up. Bitcoin is down.
Stories/News from Seeking Alpha…
Market reaction
Stock futures are sliding, the dollar is surging, crypto is tumbling, and oil is on the rise, after President Trump imposed his long-promised tariffs on Mexico, Canada and China. Markets don’t like uncertainty, or the retaliation, especially when it’s likely to be the first of many such actions under the International Emergency Economic Powers Act. It’s also developing some new trading strategies, like one from SA subscriber CatchTheFallingKnife, who recommends playing the “Trump VIX” by “buying the dip and selling the rip” over the next four years.
The case for tariffs: Trump believes that first shots were fired long ago, with Mexico and Canada not cracking down on migration and allowing fentanyl to pass through their borders, as well as “ripping off” the U.S. with trade deficits and restricting the flow of American products into their countries. He also maintains that the nations have the lower hand in any negotiations, with the U.S. having all the resources it needs, like “unlimited energy” and “more lumber than we can ever use.” The end goal of the tariffs is for companies to make their “product in the USA,” and the return of a tariff-driven federal revenue model, which “should have never ended, in favor of the Income Tax System, in 1913.”
“WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!),” Trump wrote on Truth Social over the weekend. “BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID. WE ARE A COUNTRY THAT IS NOW BEING RUN WITH COMMON SENSE – AND THE RESULTS WILL BE SPECTACULAR!!!”
The case against tariffs: The levies can mean higher costs for necessary imports, risking elevated prices for American consumers. If not universal, tariffs can also be avoided by having goods transported through third-party countries, or by companies creating alternative supply chains (like what happened in Vietnam after Chinese tariffs were first imposed in 2018). Protectionism and the limiting of foreign competition also mean more government involvement to ensure sufficient domestic competition to prevent complacent corporate behavior or monopolistic practices. What do you think? Take the WSB survey here.
What else is happening…
Groundhog Day Indicator: Phil sees shadow, no boost for stocks.
SoftBank (OTCPK:SFTBY), OpenAI set up AI joint venture in Japan.
Morgan Stanley (MS) meets with execs from X, possible debt investors.
Ontario to also pull U.S. alcohol products from shelves in tariff response.
Canada should also slap Tesla (TSLA) with 100% tariffs – Freeland.
Elon Musk calls USAID ‘beyond repair’ in latest move from DOGE.
Scorecard: Over 75% of companies beat EPS estimates last week.
SEC tightens rules over investigations in major enforcement reform.
Shopify (SHOP) CEO Tobi Lutke criticizes Canada’s retaliatory tariffs.
EU defense: Leaders to explore a potential ‘coalition of the willing’.
B>Today’s Economic Calendar
09:45 AM PMI Manufacturing Index
10:00 AM ISM Manufacturing Index
10:00 AM Construction Spending
12:30 PM Fed’s Bostic: Economic Outlook
06:30 PM Fed’s Musalem Speech
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