June 21, 2022

Markets:

Stock futures rose in early morning trading Tuesday following a brutal week as investors assessed a more aggressive Federal Reserve and rising chances of a recession.

Brent crude was trading roughly $10 below a recent high, while President Joe Biden gets set for a trip to Saudi Arabia to discuss energy production.

Shares of Kellogg jumped more than 7% in premarket trading after the company said it would split into three separate companies. Separately, food company Mondelez increased 1.2% in premarket trading following news that it would acquire energy bar maker Clif Bar in a $2.9 billion transaction.

Airline stocks soared higher in premarket trading after last week’s tumble. Shares of Spirit Airlines jumped more than 9% in premarket trading after JetBlue raised its takeover offer to $33.50 a share, even as Spirit deliberates a proposed merger with Frontier Group. JetBlue’s stock price jumped 1.8% in premarket trading.

The major averages suffered their 10th losing week in 11 last week on fears that the central bank will hike rates aggressively to tame inflation at the risk of causing an economic downturn. The S&P 500 dropped 5.8% last week for its biggest weekly loss since March 2020, dipping deeper into bear market territory. The equity benchmark is now more than 23% off its record high from early January.

Fed Chair Jerome Powell will testify before Congress Wednesday and Thursday. His appearance comes after a recent rate hike by three-quarters of a percentage point, the central bank’s biggest increase since 1994.

Investors will monitor incoming data, including existing home sales on Tuesday, to gauge the health of the economy. Recent data showing low consumer confidence, falling retail spending and a cooling housing market have fueled recession fears as the Fed battles inflation at 41-year highs.

Meanwhile, cryptocurrencies continued their roller-coaster ride. Bitcoin fell to a new 2022 low of $17,601.58 over the weekend before climbing back above the $20,000 mark on Monday. The world’s largest cryptocurrency by market cap sits 70% below its all-time high hit in November.

Portfolio:

We enter the new trading week holding only three positions: DISH, ALLY, and holding ITRM.  As we stated last week we do expect a bounce into the quarter close but feel we are still a few days early. A few sectors are rallying this morning on soft news; could be beautiful set-ups emerging here. We will be watching the market open, how we hold the price activity, and the volume within the market to start. We will be extremely patient here but the queue is igniting. Should be a great period ahead as we head into mid-terms. Let's have a great session.