Good morning. Futures point to a slight rise this morning except for the Dow, due to expected poor performance from one of its holdings. What is interesting is the composition of the indexes we look at every day. While the S&P 500 has many more holdings (around 500, duh) than the Dow (30) … the Dow is “price-weighted” and a high-priced stock will have a much larger effect than a low-priced one. The top … and heaviest … holding in the Dow is UnitedHealth Group, UNH, and an expected sharp decline on this one promises to weigh heavily on the entire index. Yesterday, comments from Fed Chairman Powell had its own negative weight on … well … all the indexes … as he shared the view that tariffs really make the job of the Fed all the more complicated … as it tries to balance its goals of keeping employment steady while controlling inflation. And, while the Fed positions itself as being independent … and free of politics … the president has not been shy over his disappointment that rates have not been cut and has publicly stated that Powell’s termination “can’t come fast enough.” By the way … the Chair cannot be “fired” … and for those still awake … Powell was first selected as Chair in 2018 during Trump’s first term and his “chairmanship” runs until sometime in May of next year. The tariff situation is, of course, ongoing … and while the president is touting its success with the claim that it is bringing in $2 billion each day, the agency actually in charge of the collections are reporting a much lower number … so if tariffs were the key to replace the income tax, as claimed, that doesn’t seem to be possible any time soon. In addition, China has stopped some containers from coming into the U.S. … which certainly could start to be felt in April’s numbers which have yet to be released. The only other thing I wanted to point out this morning was an interesting comment from one of today’s included articles in which there is overwhelming support to bring more factories to the U.S. … but there is little appetite of those cheering for these factories to actually want to work in one. And that could be a problem. And I probably won’t write tomorrow … as it is Good Friday and markets are closed … unless it is to report something exciting from my golf attempt later this morning. I also feel I need to find another doctor as I’m mad at the one I have now. I overcame my shyness, showed him a rash I am developing on my bottom, and he completely ignored me while acting as if he didn’t know me … … as he continued to push his cart through the Costco aisles. Have a great day, Joseph G. Witthohn, CFA Have any questions? Please contact info@teamemerald.com
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