Morning Market Feed May 14th

We saw the return of the meme stocks. GameStop, AMC, KOSS, and Robinhood, all of them were seeing a lot of momentum with AMC being the strongest momentum-holding name. Even Tesla was up today and that means that we will have to see what is happening, so let’s dive straight into it!

- Nvidia is now an inflation hedge
Just when you thought we were due for some market cool-down, I saw this article stating that after Bitcoin, Nvidia is now also a hedge against inflation. So now you know to just hold $30K GPU’s instead of gold. Okay, when actually reading the article they make some decent points. They say that gold is the favored inflation hedge by 46% of the survey participant, “but nearly a third said the tech behemoths are their first pick for the role”. The big tech behemoths here are Nvidia, Amazon, and Meta.
However strange this may sound at first, the article cites the impressive run these stocks have been on as an argument as to why investors like the equities as an inflation hedge.
Source of the GPU hedge

- The Kitten Returns
After three years of being absent from X, Roaring Kitty returns posting a simple meme that sparked GameStop (GME) to shoot up 50% in pre-market yesterday, peaking at $38.15, and ending the day at $30.45, up 74.4%. In after-hours trading, when there is less liquidity, shares have been pushed up to $36.90 again.
As a refresher, Keith Gill, “Roaring Kitty” was the one pushing his bullish view of GameStop which resulted in the short squeeze, which eventually ended as Robinhood had to shut down trading due to capital requirements. The stock was trading at around $480 in pre-market trading, or $120 after the later stock split.
The sudden boom in GameStop pulled other retail-focused stocks up such as SoFi, Robinhood, and Carvana. AMC, Koss, and BlackBerry have been joining the fun as these were part of the original pumps as well.
This one original tweet, caused over 1 billion dollars in paper losses for short sellers, who will be very much on their toes after today in order to prevent blow-ups.
You can check this article for more on what happened with the ‘21 rally
Source for the losses.

Despite all the attention today going to GameStop, and the participating stocks, there have been more companies with news. Because for example, we have so many Dicks…

- So many Dicks
Yes, we have too many of them according to ELF Beauty. Although it sounds funny, what they mean is that we have too many men named Richard, Rich, or Rick (Dicks) on corporate boards. This data came out as part of a push towards more diverse boards as ELF Beauty is only one of four publicly traded US Companies with a board that consists of two-thirds women, and one-third diverse. The latest push is part of the “Change The Board Game” initiative, and a poster with too many Dicks was posted in one of the busiest business hubs of New York (Picture below). ELF explains how they got the data and how the numbers stack up further in the article, but in my opinion, it’s great marketing to create a positive brand. ELF Beauty has been one of the best-performing stocks in the past 5-years with share price appreciation of 1230%.
Many Dick Article

- So what can we expect from our Dicks today?

There are some earnings we are expecting today which can be quite important. Will they move markets? Probably not due to the economic data expected today which I will tell you about after the earnings.

• Before Market Open:

Home Depot (HD): $3.60 of EPS expected on $36.637 of revenue
Home Depot will give somewhat of a read on the consumer as we have been starting to see mixed signals during this earnings season. True consumer stocks like Etsy have not had a good quarter, while most other stocks have done great. Home Depot will give us both the consumer for DIY projects, as well as business spend on projects.

Ali Baba (BABA): $1.42 of EPS expected on $30.498B of revenue
Ali Baba is one of the trades currently in play for retail investors as they are looking for a reversal in Chinese stocks. Ali Baba stock has been in the gutter as shares are now trading at $84, jumping 23% since the middle of April. At the peak in 2020, shares were trading over $300.

ON Holdings (ONON) $0.15 of EPS expected on $551.355M of revenue
ON Holdings is an important stock to watch if you are interested in Nike because it is one of the competitors that has been taking market share recently. ON Holdings doing good might mean that they take further customers from Nike.

• Economic Data for Today

Today will start with an important signal for tomorrow, as we are looking for PPI data to be released today. After the PPI release, all eyes will shift towards the FED Speaker for today as Jerome Powell, the FED’s Chairperson will give a speech about 30 minutes after the market opens. The numbers economists are expecting for PPI:

- PPI: 0.3% MoM, 2.2% YoY (Prior release 0.2% MoM, 2.1% YoY)
- Core PPI: 0.2% MoM, 2.4% YoY (Prior Release 0.2% MoM, 2.4% YoY)
- Prior PPI ex Food, Energy, Trade previous numbers came in at 0.3% MoM, 2.8% YoY. There are no expectations given but it is a number being looked at as this number makes up 68% of the PPI Index.

That was it for today, I will be watching the PPI numbers because if these come in hot, markets will get nervous about CPI tomorrow which can lead to some good buying opportunities. Tomorrow I will send another stock analysis, so Thursday I will report on the numbers from today and tomorrow.

If you liked this article, please make sure to subscribe to my newsletter. You can do so by clicking on the button below!
What to expect from it?

- One growth stock analysis per week
- Monday through Friday you’ll receive the Morning Market Feed in which I go over the news of yesterday with a skeptical/cynical twist. Finance should be fun, personal finance is serious enough by itself.

You can unsubscribe from the newsletter at any moment, this is of course without any questions asked.