The Morning Call
4/23/21
The
Market
Technical
Thursday in the
charts.
https://www.zerohedge.com/markets/way-go-joe-bonds-bid-biden-tax-plan-tanks-stocks
Does yesterday’s sell
off have legs?
https://www.zerohedge.com/the-market-ear/selloff
Fundamental
Headlines
The
Economy
US
March existing home sales fell 3.7% versus
expectations of +0.8%.
https://www.advisorperspectives.com/dshort/updates/2021/04/22/existing-home-sales-down-3-7-in-march
The March leading
economic indicators rose 1.3% versus estimates of +1.0%
The April Kansas
City Fed manufacturing index came in at 31 versus 26 reported in March.
International
The March EU flash
consumer confidence index was reported at -8.1 versus consensus of -10.8; April
UK consumer confidence was -15 versus -12.
March UK retail
sales were up 5.4% versus projections of up 1.5%; ex energy they were up 4.9%
versus up 1.9%; the April flash manufacturing PMI was 60.7 versus 59.0; the flash
services PMI was 60.1 versus 59.0; the flash composite PMI was 60.0 versus 58.2.
The March Japanese
CPI came in at +0.3% versus +0.2% reported in February; the April flash
manufacturing PMI was 53.3 versus 52.7 in March; the flash services PMI was
48.3 versus 48,2 in March; the flash composite PMI was 50.2 versus 49.9 in
March.
The April German
flash manufacturing PMI was 66.4 versus predictions of 65.8; the flash services
PMI was 50.1 versus 50.8; the flash composite PMI was 56.0 versus 56.8.
The April EU flash
manufacturing PMI was 63.3 versus expectations of 62.0; the flash services PMI
was 50.3 versus 49.1; the flash composite PMI was 53.7 versus 52.8.
Other
The mortgage delinquency rate fell sharply in
March.
https://www.calculatedriskblog.com/2021/04/black-knight-national-mortgage.html
Biden’s
Plan
Biden proposes doubling the capital gains tax.
https://www.zerohedge.com/markets/stocks-puke-bidens-capital-gains-tax-reality-strikes
Street reaction.
The
coronavirus
Many potential risks from the coronavirus
have not gone away.
The global
coronavirus infection rate is rising and threatens economic recovery.
The failure of the initial coronavirus modeling.
https://www.zerohedge.com/covid-19/failure-imperial-college-modeling-far-worse-we-knew
Bottom
line. Of course, the news of the day was the capital
gains tax increase proposal from Biden.
Stocks clearly did not like. But
(1) the universe already knew that Biden intended to hike taxes on the wealthy---the
only question was how much, (2) this is only a proposal and it is long way to
signed legislation---which almost certainly will look nothing like the current
proposal.
So, it is too soon
to start analyzing how good or bad this would be for the economy because we
simply don’t know what the ultimate spending/taxing legislation will look
like. But I will opine that neither will
likely be positive. More spending simple
pushes the national debt further above the levels marked by the Rogoff/Reinhard
study as a drag on economic growth. And if yesterday’s in action is any guide,
higher capital gain taxes are likely to prove disruptive to the Market.
Value investing requires patience.
Don’t buy what someone wants to sell you.
https://alephblog.com/2021/04/21/the-rules-part-lxix/
News on Stocks in Our Portfolios
Genuine Parts (NYSE:GPC): Q1 Non-GAAP EPS of $1.50 beats by $0.36; GAAP EPS
of $1.50 beats by $0.32.
Revenue
of $4.46B (+9.0% Y/Y) beats by $160M.
What
I am reading today
The
politicization of everything.
https://americanconsequences.com/pj-o-rourke-the-politicization-of-everything/
In
a free society there is no such thing as ‘positive rights’.
Quote of the day.
OOOOh, Noooo, Late frost decimates
French vineyards,
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