Market Talk
The economic data of inflation and employment is making the market believe a high probability of an interest rate cut by the Federal Reserve in September. At the same time, after rising, many stocks are being perceived as being "priced to perfection". When this happens, stocks can trade down due to such things as insider selling, the "tutes" following on perceived valuation concerns and just plain old profit taking. If you have a stock, perhaps smartly in an IRA, one tenet of this site is to maintain more greens the reds and don't marry a stock when the price seems to be cascading down for no apparent reason except that insiders are selling. To a small investor, that can feel like a betrayal and to institutions, they may follow in selling as well. Understanding such market dynamics can be helpful as a small investor to stay in the game and not take a loss, especially when a nice gain is there for the taking. Sometimes trimming some shares is a good move to keep the powder dry for better opportunity.
Stock Talk
Some of the key stocks watched and noted months ago have gone up quite a bit, some even more than four times.
While the bullish thesis put forward back then still may apply, some stocks like KTOS and METC as examples have seen share price pullbacks. This means that market has already taken the stock higher on future projections but then says - let's let them earn the valuation before the next leg higher. During this phase of waiting, the market can grow impatient, and conviction falls when things seem to take too long. The limbo phase can be subject to whipsaws lower and that is something that the small investor, if aware, may say hmmm - maybe it's time to trim some shares and wait out limbo or look for new opportunity.
One area of notice is that high dividend stocks are gaining market interest and valuations are moving higher in stocks like Altria Group MO. The Jones report had MO in the 40's and 50's and sold BUT kept the shares that were reinvested from the dividend. MO is now in the 60's and the market likes the cheek ON pouches as taking market share from the Vapes. Rather than jumping back in MO for a 6% divy, maybe watching the new Ramaco high-interest rate convertible preferred shares -METCI with the 8.25% annual dividend rate based on its $25 par value is something to consider with a "some - not too much" investment. As far as Ramaco shares METC or METCB, the METCB shares pay a higher dividend and have a royalty base on the rare earths projected on the Wyoming Brook Mine. Watching the recent trading - METCB and METCI (just for the divy) seem like a better pick if dabbling in Ramaco shares. Of course, this is all dependent on Ramaco mining staying vibrant and profitable.
LRCX has had resistance above 100. They have an advantage that is worth watching but we had it here in the 60's and that is a tempting gain while the next limbo phase trades itself out.
As often can happen - NO stock is safe from a whipsaw when the "tute" decides to bail for whatever reason they may see or pick. For this reason, play your game as you see fit for your own situation and risk tolerance. Make some money and lock some in is one way to go to ride the wave and save yourself before "the tutes' " profit taking - takes your own gain. At some point, the excess inventory logged in by the building inventories - will wind down and tariffs will likely kick into the future inflation reports. Stay watchful and circumspect but have fun in the by and by.
Kinross Gold (KGC) mining reported a large quarterly earnings beat with an eps of 44 cents. This is a 33% earnings beat over average analyst expectations and shows an increasing earnings trend over previous results. It is the Jones report view that KGC is a real deal stock and currently quite undervalued and "should be" in the 20's.
Hecla Mining Company (HL) has various gold, silver, copper mines in Canada , Alaska and Idaho as well as lead and zinc mining. HL also has exploration sites in Montana, Nevada, Colorado and Washington state. Northwest Mexico. HL is added as a Watch stock now in the $7 ish range to start tracking and maybe transitioning into as a "some stock " long position.
One spec stock that we said don't mention has to be mentioned:
OPEN : With the Fed now taking about cutting rates is September?
the volume is taking it higher today. OK it's a meme stock - power to the people. Ok- we won't "memetion " it but if somebody was in for 100 or so shares as a spec stock - The Jones way could not blame them.
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If interested - scroll back and view notes on other stocks, we watch here at the Jones report. Why not? With the caveat that things change and we try to stay aware - It's all FREE to read and make your own calls and decisions. Finally - maintain some dry powder and trade or invest according to your own due diligence.
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More later so ....Stay tuned, if you dare !
For now, we close by noting that any view on the market and stocks on any particular day may change in the future days to come. That is why we watch and see how our views match up with the reality of the time. But trying to look ahead a few months into the future may be a way to do things. If you think too deep about world events and the recent alliances forming, projecting ahead can be a dicey endeavor. In all - we use the word maybe "some", not "too much" and play it accordingly. Remember, never get arrogant in our various notions because things do change in the market and individual stocks are subject to many factors outside of our control.. So we try to -stay aware.
With all the above caveats and attempted prognostications, I will close this post. Stay tuned for more opining on the market and stocks to watch.
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ALL in my humble opinion, scroll down and read more.This site does NOT make Buy / Sell recommendations.
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