I pinpointed retail sales as last week’s biggest inflection point for Wall Street in my look ahead…
And we had lousy retail earnings that were slightly better than expected, which helped drive stocks higher. But earnings season is ending, so it’s important to look for new catalysts that could move the market.
An 0.1% month-over-month increase was expected in retail sales coming into the week, and we got 0.0%. But there’s a catch… the reason it was flat is due to the fact that energy prices came down in July.
So if you take out autos and gas, retail sales were actually quite a bit higher at 0.7%. If we look at what’s stressing the market right now, it’s the 10-year yield, which is up again Friday, and that’s going to be a negative stress on growth stocks like Cathie Wood’s ARK Innovation ETF, ARKK.
ARKK started the week around $52, we got stronger retail sales numbers excluding gas and autos, which means the Federal Reserve has more ramp to raise interest rates — and that’s not good for growth stocks.
So look what happened to ARKK, down to under $45 by Friday afternoon, a 14% haircut in just a few days…
This will keep moving the needle this week, and it’s something we have to pay attention to.
The retail sector was in sharp focus last week with weaker-than-expected sales reported, and a series of lackluster earnings reports hitting the headlines.
And to put the cherry on top, all the steam on the memstonk Bed Bath & Beyond trade has been let out after Ryan Cohen — the king of meme investors — unloaded all of his shares in BBBY, crushing the ape army’s hopes and dreams as the stock crashed 40% overnight.
All of that news helped sour the mood on Wall Street, creating a challenging sideways market set to finish lower for the first time in weeks...
But as you know, we’re traders here at New Money Crew. And even in this choppy mess, our strategies are hitting sizable scores!
Because no matter which way the markets are moving, we stay nimble and pounce on the companies and events that can move prices no matter the trend!
A Gap is a break between prices on a stock chart that occurs when the price makes a sharp move up or down with no trading in between. In general, gaps occur at the opening of major exchanges. Opening gaps result from a newsworthy event that happens after trading is over, which has an effect on the price of a security. This effect outside of trading hours results in an imbalance in supply and demand when the market opens the next day, thus leading to a gap.
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