Interim Market Update May 17, 2023

[jonnyfrank]

Yes, chasing is not a good idea, this I know. I was just checking in to see if the NDX will have a higher target in the short term is all. I made a little on SOXL today but I am out. This was a holding in my ST portfolio is all.

[MarkD]

Two cents

1. My cousin (logistics industry) indicates companies still trying to find warehouse space. There's too much inventory atm.

2. Housing starts jumped again. And labor in my area (Nashville) is neither priced reasonably nor available in a timely manner (months of backlog). We need a shower door repair/replacement. Nobody will even look at it under $200. And that's just to review the project.

I cannot fathom the Fed doesn't raise rates throughout '23. Stronger dollar, lower bond/stock prices near term (0-6 months). The 7% mortgage seems to be creating a situation similar to late '70s early '80s when I observed the early boomers buying homes as rates continued to climb. And the Zoomer cohort is at that same place. Wife and I did not buy our first home until later ('86) and prices had definitely increased by a considerable amount, but rates had fallen to the 13% area (knew a few who had 18% mortgages). I don't anticipate mortgage rates at double digits but if the fiscal side continues to increase spend, who knows.

[Yodean]

*****

Speaking of chasing, I suspect if the equity rally continues after some consolidation and breadth improves, more discretionary traders as well as the slower CTAs will have to chase the markets up a bit.