Well folks, it’s now the second last trading session of the year, and after yesterday’s poor performance of worldwide equity indices, it's looking like St.Nicholas is not coming to town…Regardless, stocks are posturing for an up day in the premarket and as always, read on for your daily trade recommendation, stories on the US Supreme Court’s ruling on Title 42 as well as newfound questions surrounding Chinese exports.
Markets in Review
Yesterday was largely risk-off for markets and this resulted in low single-digit losses across the board for NA equities, with both the S&P and TSX dropping 120 and 101 bps by the close. This has brought the S&P (pictured below) even further into free-fall territory as its trading farther away from its support or long-term moving averages. While no catalysts present themselves for today or tomorrow, next week is highly likely to see a spike in volatility as traders position themselves for results of the Friday Jobs report on the 6th. In the premarket today, the Dow, S&P and Nasdaq are up 35, 57 and 85 bps - so there is still a chance for a slight turnaround from these levels prior to the year’s end.
Long: Cal-Maine Foods, Inc. (CALM-NASDAQ) | Timeline: 2 days
Cal-Maine Foods, Inc. (CALM), which produces, grades, packages, markets, and distributes shell eggs, reported record results a couple of days ago. The company successfully reported record quarterly net sales of $801.7 million, a 110% increase compared with the same quarter last year, driven by record average conventional egg selling price. (Full Story) Turning to the chart, CALM has had a stellar year so far, climbing from lows of around the $45 mark. That said, the price has now broken through its existing price channel driven by this extremely positive sentiment and is poised for another leg up from the open, as the Stochastic RSI enters extremely overbought levels and the price approaches its new support level.
Zooming out...
Border Stays Tight(eled) In a 5-4 vote, the US Supreme Court has upheld the ever-controversial ruling, Title 42. For some background, Title 42 was issued by the Trump administration during the first months of the pandemic in an effort to stem the flow of migrants that were able to claim asylum within, or at the border of the United States. This was accomplished by giving border patrol agents the authority to rapidly expel migrants due to the risks presented by Covid. The mandate has remained in place despite numerous challenges over the past >30 months due to the rulings of a variety of federal judges acting on behalf of concerned states. This Supreme Court opinion keeps the policy in place until February, however, the Court does not seem happy with their role in this debacle as the decision was concluded with the following: “[C]ourts should not be in the business of perpetuating administrative edicts designed for one emergency only because elected officials have failed to address a different emergency. We are a court of law, not policymakers of last resort” Chinese Exports In Question Despite having the world’s largest outbreak of Covid that’s only growing by the day, China has continued to drop nearly all testing restrictions for domestic and international travel. While great for the citizens of the nation in terms of freedom of mobility rights, the globe has not reacted warmly to the prospect of thousands of cases being exported to their borders in a scenario eerily similar to the first quarter of 2020. This cool reaction was proven correct on Tuesday as two flights into Milan from China contained passengers with a 50% positive covid rate. Resultantly Italy, Japan, Taiwan and the United States have begun to institute mandatory testing policies on passengers arriving from China, while a plethora of other nations are considering similar policies. It will be a tough balancing act for countries hoping for the economically stimulating return of Chinese tourists after nearly three years of absence, however, it seems that many governments have become less cavalier, and a bit smarter in this second go around.
Making headlines...
11 tax changes and new rules that will affect your finances in 2023
Given the high inflation we experienced in 2022, many of the important tax figures have been substantially increased for 2023. Here are the new numbers, along with a few other changes that launch on Jan. 1. (Full Story)
Russia fires more missiles across Ukraine
Russia fired more than 120 missiles across Ukraine on Thursday morning in the biggest wave of attacks the country has seen in months, officials said. (Full Story)
Novartis to pay $245 million to end antitrust cases over Exforge drug generics
Novartis AG said on Wednesday it will pay $245 million to end antitrust litigation accusing the Swiss drugmaker of trying to delay the launch in the United States of generic versions of its Exforge hypertension drug. (Full Story)
Lessons from FTX: What we learned about transparency, accountability and regulations
Crypto investors, regulators and executives are taking stock of some of the difficult lessons learned in the wake of the extraordinary and swift downfall of crypto exchange FTX and its executives. (Full Story)
Chart of the Day: Either the timing has changed or it is broken.
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