December 12, 2022

Bulls At Play Before Fed Day

Stonks ended almost universally in the green today and before inflation data comes out tomorrow. 🟩

Today’s issue covers some of this year’s biggest M&As that happened today and why stonks might see some major whipsaws this week. 📰

Check out today’s heat map:

All sectors closed in the green today! Energy was the leader with a +2.49% gain. Consumer Discretionary was the laggard at +0.39%. 🎊

Inflation expectation data from the New York Fed was lower than expected, 5.2% vs. 5.9%. The expected inflation recorded a month-to-month decline in November. The Keystone pipeline and concerns about supply bumped oil futures up $2.43/barrel (+3.42%). 🛢️

Microsoft ($MSFT) is spending $2 billion for a 4% stake in the London Stock Exchange Group. 💂‍♂️

Oracle’s ($ORCL) post-market earnings were better than expected. ORCL beat on earnings ($1.21/share adjusted vs. $1.18/share) and revenue ($12.28 billion vs. $12.05 billion). Net income was $1.74 billion vs $1.25 billion loss in the same quarter last year. Oracle is trading up +2.03 after market. 👁️

The largest cryptocurrency exchange in the world, Binance, is under a metric crap ton of scrutiny after releasing a somewhat ‘questionable’ report regarding its reserves and liabilities. There are also reports that some users are having difficulty withdrawing stablecoins from Binance. And there are rumors that Ripple ($XRP.X) may settle with the SEC as soon as December 15 – but nothing has been substantiated yet. 🪙

Other symbols active on the streams included: $RIVN (-6.23%), $PYPL (+0.27%), $QQQ (+1.09%), $EEFT (+0.43%), $SPY (+1.30%), $TSLA (-5.99%), $AMC (+5.95), $BTC.X (+0.27%), $LABU (+6.60%), $DIA (+1.48%), $MMTLP (-58.13%), and $AMAM (-37.00%). 😲

Here are the closing prices:

S&P 500	3,934	1.43%
Nasdaq	11,005	1.26%
Russell 2000	1,797	1.11%
Dow Jones	33,476	1.58%

Company News

That’s A Lot Of Hotdogs

After the dismal M&A activity in Q3 (the worst since 2020), any activity is a good thing as interpreted by analysts.

Before the opening of today’s trading day, roughly $40 billion in the M&A space occurred; here are some of the most notable movers.

Amgen ($AMGN) acquired the rare disease drug maker Horizon Therapeutics ($HZNP) for $27.8 billion – in cash ($116.60/share).

The acquisition by Amgen is its largest ever, and it is 2022’s largest pharma merger.

Coupa Software ($COUP) sells itself to private equity firm Thomas Bravo for $6.2 billion in cash.

My favorite grill maker, Weber ($WEBR), is also going private – BDT Capital Partners reportedly buying Weber for $3.7 billion or 708,812,260 hotdogs, adjusted for inflation. 🌭

Economy

It’s Whipsaw Week

If the stonk market had a combination of days as awful as a fruitcake and figgy pudding smoothie, then the next couple of days are it.

Tomorrow (Tuesday, December 13), investors will look at inflation numbers – specifically the Core Inflation Rate YoY.

Throw in a dash of CPI and MoM Inflation data, and you’ve got a recipe that people will either love or want to send back quicker than a complete Blu-ray Collector’s Edition of Lifetime’s Christmas Movie Specials.

Wednesday rolls around (December 14) with 2022’s last Fed Interest Rate decision. Combined with Powell’s presser, his final gift to investors for 2022 is another box of socks or a surprising wad of cash.

But we’re probably getting another box of socks.

Either way, this week will likely be full of whipsaws and traps. So be careful out there. 🪚

Bullets

Bullets From The Day:

💵 The IRS says that early filers should wait to submit their tax returns. Specifically, the IRS says taxpayers need to watch out for Form 1099-K. You’d receive this form if you’ve received payment from services like Paypal or Venmo. The deadline for companies to send the 1099-K is January 31st. More from CNBC.

💡 For the first time in history, a net gain was (reportedly) achieved with a nuclear fusion reaction. The National Ignition Facility reportedly achieved a net gain of 120% – 2.5 megajoules of output vs. 2.1 megajoules of input. The Departement Of Energy is scheduled to announce and confirm this breakthrough sometime today. While the broad application of fusion energy is still years away, it is expected to disrupt the energy industry massively. Power Magazine has more.

🚗 Toyota ($TM) halts C-HR sales and production for the U.S. Fans of the Cross Hatch Run have been dealt a major blow today. Toyota’s version of a motorized pregnant rollerskate will only be available in Europe after 2022. For those looking for a part-SUV part-hatchback part-car, Toyota explains that the Rav-4 is still available. More from TheStreet.

🛍️ Remember when everyone warned that a handful of tech stocks represented too much of the major indices? That’s better than just one stock representing too much of an index. Shopify Inc. ($SHOP) is down nearly 70% for the year. As a result, it’s dragged the S&P/TSX Index lower by more than 6% in Loonie Dollars alone. Without Shopify, the loss would be less than 2%. Interestingly, the S&P/TSX is still outperforming US equities and has yet to enter a technical bear market. Yahoo!Finance has more.