April 14, 2022

Markets:

Stock futures were little changed Thursday morning as investors digested mixed earnings results from major banks.

Major banks including Goldman Sachs, Morgan Stanley and Wells Fargo posted their first-quarter earnings on Thursday. Investors are monitoring how banks weathered surging inflation and a recession warning from the bond market in the form of the flattening yield curve.

Goldman Sachs’ stock price jumped nearly 2% after beating first-quarter earnings expectations. Goldman reported $10.76 earnings per share and $12.93 billion revenues. Shares for Morgan Stanley popped more than 2% after the bank reported an earnings beat. The firm earned $2.02 per share and revenues of $14.8 billion. In comparison, Morgan Stanley was expected to report $1.68 a share and revenues of $14.2 billion.

Twitter shares popped in premarket trading Thursday after Elon Musk offered to buy the social media company for $54.20 a share. Musk said this was his best and final offer for Twitter, which he said needs to be transformed privately in order to thrive.

Wednesday’s market reversal came after an initial batch of quarterly results from companies including Delta, Fastenal and and BlackRock, which came in better than expected. Investors have been eager to see how well companies have managed mounting inflationary pressures.

Still, the S&P 500 is down 0.9% for the week on inflation fears as a Tuesday CPI report showed price increases not seen since 1981. The Nasdaq Composite is off by 0.5% and the Dow is down 0.5% on the week. Trading is closed at the NYSE on Friday. However, bond traders will enjoy not just a full Friday off, but also a partial trading day Thursday. The bond markets will shut down early, at 2 p.m.

Portfolio:

We enter todays trading session holding positions in GATO, PBR, RF, TWTR, CLF, and ITRM. Portfolio looks really good this morning!

Yesterdays price activity took so many folks by surprise and once again caught so many shorts. Market continues to swing but we finally are starting to receive earnings and forecasts. This will be a huge stepping stone for the markets. Cannot wait to receive growth and tech stock earnings. Some of these names are currently trading 3 to 5x lower from where they will be in 5 years. So many bargains are out there.

We expect a potential light volume session today as many will start their Easter break early. Next week, a full week of trading with many traders back from Spring vacation, has the potential to be sensational with trade set-ups. Be ready! We expect a monster period ahead!