February 1, 2022

Markets:

Stocks futures were little changed on Tuesday morning, following a wild January on Wall Street that saw investors struggle with a Federal Reserve policy shift.

Shares of UPS jumped 7% premarket after the shipping company beat earnings estimates and raised its quarterly dividend 49%. Its rival FedEx added 3%.

Over the past several days, investors have stepped in to buy a dip in which the S&P 500 briefly fell into correction territory, defined as a drop of 10% from the most recent high. The large-cap index has risen 2.4% over the past five trading days.

While stocks pulled off a tech-driven rally Monday, major averages still suffered a brutal month marked by wild price swings. The S&P 500 and the Nasdaq Composite posted their worst months since March 2020 at the depth of the pandemic, down 5.3% and 8.9%, respectively. It was also the S&P 500′s biggest January decline since 2009. The blue-chip Dow slid 3.3% for the month.

Volatility exploded as investors deciphered the Fed’s messaging on its policy pivot. At one point last week, the S&P 500 dipped into correction territory on an intraday basis. The recent comeback pushed the large-cap benchmark 6.3% below its peak. Meanwhile, the Nasdaq, which is weighted to tech names, is still in a correction, last down 12% from its all-time high.

Investors are awaiting more key earnings reports, with Alphabet, General Motors, Starbucks, AMD and PayPal due after the close.

Portfolio:

We enter today's trading session holding positions in PLTR, MRO, and ITRM.  PLTR is rocking in premarket as well.

We move into February with a beautiful trading cycle beginning.  The next several months should be absolutely outstanding to trade, especially with the volatility we have in place.

Please be ready early on today.  We might actually raise the target on PLTR.  If we decide to do so, we will send another update prior to the open. Let's have a great session.