Well folks, after yesterday’s decent performance on the part of equities, traders may be back at it again with last-minute bets ahead of tomorrow’s 8:30 AM CPI release, which is actually expected to come in at -0.1% for the month of December. Furthermore, Fed Chair, Jerome Powell will be speaking at 9 AM today - catch the real-time updates here. Also, in case you missed it yesterday, we put out a special report on the augmented reality space with a spotlight on a Canadian company making waves, be sure to check that out here and enjoy your daily dose of market inspiration with this 193rd Coachman’s Report!
Markets in Review
Following yesterday’s rise in equities, premarket futures are up marginally with the Dow, S&P and Nasdaq trading +15, 20 and 14 bps at the time of writing. After Monday’s minor loss, yesterday’s advance brought the S&P to price levels seen last during the speculation in late December regarding a ‘Santa Claus’ rally.
Regardless, the index is trading in the middle of its price channel and just peeked above the 200-day moving average, in fact, the 50 and 200 day MA’s haven’t traded this close together for almost 11 months, if tomorrow’s inflation print comes in at or below expectations and the Fed hikes interest rates by 25 bps, a little outside of a mediocre Q4 earnings season will be needed to confirm a bullish long term trend.
Long: Saratoga Investment Corp. (SAR-NYSE) | Timeline: 2 days
Saratoga Investment Corp. (SAR), a business development company specializing in leveraged and management buyouts, recapitalization, and a wide array of financing at the lower end of middle market companies, reported stellar earnings yesterday after the market closed. The company managed to beat earnings and revenue estimates by 22.06% and 10.17%, respectively, as “rising interest rates positively impact the Company’s earnings from its asset and liability structure” (Christian L. Oberbeck, CEO). (Full Story) Turning to the chart, 2022 was all about recovery for SAR as they return to these levels from lows in and around the $20 mark. That said, as the stock continued to oscillate, a cup and hand formed - a widely used bullish signal extending an uptrend, giving traders an opportunity to capitalize on a textbook technical setup pushed by positive investor sentiment.
Zooming out...
FAA Outage US flights have been delayed en masse once again, however, the culprit isn’t a weather event or singular airline like in previous scenarios, this time it’s the FAA’s fault. As a result of a computer glitch the FAA’s Notice to Air Missions System was knocked offline early Wednesday morning. At the time of writing the system has been offline for nearly two hours, with the only guidance from the FAA being that “they are working to fully restore” the system. Additionally, all domestic departures have been cancelled until 9 am eastern as the integrity of flight and safety information cannot yet be verified. Moreover, at the time of writing 2512 flights have been delayed, with a further 238 cancellations within, into or out of the United States. (Source) While the FAA has said that this was simply an outage, many have already speculated that this could be a cyberattack due to similar outages affecting air travel across North America in recent months. World Bank Bummer Yesterday, the World Bank cut its global economic growth forecasts by over 40%, downgrading their 2023 expectations from 3% to 1.7%. This stark decrease from their last forecast, which was released 6 months ago, included downward revisions for 95% of advanced countries, and 70% of developing ones. They also have stated that any abrupt change in the global financial system, from high inflation to a covid resurgence, could throw the world into a recession due to the fragile state that it remains in following the pandemic and subsequent interest rate hikes. World Bank Group President David Malpass was quoted as saying “The crisis facing development is intensifying as the global growth outlook deteriorates”.
Making headlines...
Offices sit empty as vacancy rates hit all-time high in Q4: CBRE
Despite the full reopening of the economy, the office market is seeing record-high vacancy rates as it faces a fresh set of challenges, including a pullback in the tech sector. (Full Story)
Barrick Gold signs deals with Saudi miner Ma'aden
Barrick Gold Corp said on Wednesday it signed new joint venture deals with Saudi Arabian Mining Co (Ma'aden), the Gulf's largest miner, for two copper exploration projects. (Full Story)
Ukraine Latest: Zelenskiy Says Russian War Won’t Become WWIII
Ukraine will stop Russian aggression and the conflict won’t turn into World War III, President Volodymyr Zelenskiy said as his forces battled to keep control of Soledar and Bakhmut in the eastern Donetsk region. (Full Story)
Europe’s Inflation Anxiety Is Fading Quicker Than Prices
Euro-zone inflation remains near a historic high, but consumer expectations about the path for prices have largely receded back to their long-term norm. (Full Story)
Chart of the Day: Savings rate collapse…
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