Weekend Wall Street #30 - Super Bowl, Game Plans, Inflation, and My Best Trades
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Traders- we have an exciting week coming up for us here.
Last week was interesting because of Powells speech where he indicated that the Fed could get more hawkish.
The drop in stocks was mainly caused by the jobs report which showed unemployment at 3.4% which is a 54 year low! This is not good for inflation as you need ~5% unemployment for an economy to be economically efficient and to drop inflation.
But before we talk about inflation, it’s Super Bowl weekend! 🏈
Let’s talk about how that influences the market:
The Super Bowl Stock Indicator was developed in 2000 by hedge fund operator Doug Kass where he looks at which companies are spending the most on advertising and which types of companies are buying ads.
On the FOX earnings call, CEO Lachlan Murdoch let a few things slip:
#1) They are raking in $600M in revenue, a new record this Sunday and
#2) They are not seeing evidence of a soft market and, despite talk, advertisement money is coming in fluid.
Okay, now back to inflation.
The biggest catalyst for this week is going to be the CPI (Consumer Price Index inflation report) on Tuesday at 8:30 AM. The headline YoY inflation is expected to drop to 6.2% from 6.5% as you can see below.
The interesting thing about this CPI report is that it’s the first to incorporate the changes from the the Bureau of Labor Statistics (BLS). Instead of updating the weight of each component every 2 years, they’re now updating it every year.
Remember- CPI prices get updated every month to show the changes in a certain basket of goods, this is just changing how often each item is weighed at in that basket of goods.