February 7, 2022

Markets:

Stock futures traded higher Monday morning at the start of another busy week for corporate earnings and fresh economic data as investors continue to assess the Federal Reserve's path forward for monetary policy.

After last week's rollercoaster trading — with stocks sliding following Meta Platforms' (FB) disappointing outlook, and then rebounding sharply following Amazon's (AMZN) earnings beat — investors are poised to receive another hefty batch of corporate earnings results. Companies including Disney (DIS) to Uber (UBER), Lyft (LYFT), Pfizer (PFE) and Coca-Cola (KO) are each set to report quarter results in the coming days. Peloton (PTON) will also post results amid reports that companies including Amazon and Nike (NKE) are considering making bids to purchase the fitness technology company.

Consensus economists are looking for the CPI to rise by 7.3% on an annual basis for January, marking the fastest rise in prices since 1982. Such a result would further add fuel to the narrative that the U.S. economy has recovered sufficiently, and is now running hot enough, to warrant an aggressive pivot to tightening from the Fed. Last week's much better-than-expected jump in payrolls in the Labor Department's January jobs report also underscored the extent of the recovery.

And indeed, market participants have increasingly priced in the likelihood that the Federal Reserve will ultimately raise interest rates five times in 2022, marking an increase from the just three interest rate hikes the central bank itself had telegraphed in December. Some investors have also suggested that the Fed might hike rates by 50 basis points after its March policy-setting meeting rather than by a quarter-point, which would mark the first move of such a magnitude since 2000.

Portfolio:

We enter the new trading session holding positions in NIO, FUBO, PLTR, and continue to wait on ITRM.  All are moving nicely for us in premarket.

Queue is lighting up once again and we love the set-ups that are continuing to develop.  Expect another busy week ahead.  It's been a strong start to 2022 and we want strong momentum heading into the coming months.  The set-ups due to the Fed and earning releases will be spectacular.  Let's have a great session.