June 29, 2022

Markets:

Stock futures climbed on Wednesday morning, a day after the major averages made a failed attempt at a bounce, and as the market prepares to close out the worst first half of the year since 1970.

Investors are still searching for the bottom of a vicious market sell-off as the second quarter comes to an end Thursday. Concern over a slowing economy and aggressive rate hikes consumed much of the first half of 2022, and fears of a recession fears are rising.

The S&P 500, which is down about 20% in 2022, is on pace for its worst first half of the year since 1970, when the index lost 21.01%. Meanwhile, on a quarterly basis, both the Dow and S&P 500 are on track for their worst performance since 2020. The Nasdaq is headed toward its worst three-month period since 2008.

Investors are looking ahead to comments from Federal Reserve Chairman Jerome Powell at the European Central Bank forum. Earnings from Bed Bath & Beyond, General Mills and McCormick are also on deck.

Wednesday’s moves followed steep losses for the major averages the day before. The Dow fell more than 1.5% on Tuesday, while the S&P 500 and Nasdaq Composite slid 2% and 3%, respectively. The benchmarks all started the session with strong gains, but disappointing consumer confidence data halted those advances and sent stocks tumbling.

 

Portfolio:

We enter the new trading session holding positions in BTU, NCLH, AEHR, ALLY, and holding itrm. Today is another big day for the markets, not only as we head into the close of the quarter, but we are set to receive comments from Federal Reserve Chairman Jerome Powell at the European Central Bank forum. We are watching S&P closely, if we continue to build under 3855 now, it seems we can become unhinged short term. We are in a pretty good trading range right now but can see one more flush lower before we even consider stabilizing and moving higher. Just thoughts, selling seems so mechanical right now, especially yesterday's price action. Lower highs all day yesterday. Keep a watch on 3810 for ES, break below that and we can have ourselves a little waterfall event. Keep an eye on Bitcoin as well. Could get loose to downside a bit further. Easily another 20% or so before stabilizing. But again, Powell comments today will be a driver. The mid-terms coming in November will be a driver as traders begin to set-up. Truly believe we get one final flush before we push higher. Watching closely but we will trade this trend! Let's have a great session.