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Welcome to the +133 new subscribers who joined our Dividend Investor’s Edge community this past week. If this is your first time reading, but you have not yet subscribed, join our growing investing community of ~2.7K investors.

Market Talk ⏪

Last week investors got the pump fake we have been talking about for those of you that have been reading my newsletter every week. Stocks came off a strong October, but then quickly retreated last week with numerous earnings reports and more interest rate hikes. We have continued to see mixed earnings combined with constant economic headwinds, and finally the markets had enough with all three major indexes in the red for the week.

Technology continues to get pummeled and even Apple has began to show some weakness, a stock that has largely held the big tech sector together over the past few weeks. I wrote an article on this topic specifically over at Seeking Alpha last week, titled, “Apple: Time To Reset Expectations.”

During the week we had our regular scheduled 75 basis point hike from the Federal Reserve, which initially the markets jumped, but quickly fell, and fell hard after Fed Chair Powell began his briefing indicating no slowdown on the horizon. Investors were looking for some sort of turnaround verbiage, but got nothing of the sort.

We need to move to ban Powell from his briefings after rate moves because it has led to major volatility in the markets all year.

This might be the BEST Jerome Powell tweet I saw last week.

The fed futures are pointing toward a Fed Fund’s peak terminal rate slightly over 5%, which is expected to take place by June 2023. The Fed has one final meeting in December, which investors are forecasting a 50 basis point hike, but based on Powell’s commentary of “we still have a ways to go,” we could now be looking at another possible 75 basis point hike in December, which could lead to a further sell-off in the markets.

Remember, the stock market is forward looking, so the markets will generally make a move before the actual data or turnaround takes place.

The jobs data came in stronger than expected last week, but again that looks back and we may be entering a period where unemployment starts to creep back higher. Tight jobs market with low unemployment, job gains, and many open positions still.

However, during the week we saw layoffs from Twitter, Uber, Opendoor, and Stripe just to name a few.

The talk of layoffs, even among large players like META is beginning to make its rounds as well. The big tech giants have already announced hiring freezes, but if they move to start doing layoffs, that is when we know things are getting bad.

In earnings news, Warren Buffett’s Berkshire Hathaway (BRK.B) reported over the weekend noting that 73% of the equity portfolio is made up of only 5 positions.

Source

This week we have election day, which can typically be good for the stock market, so that could be the slight glimmer of hope we have for the week.

Internationally, we continued to see other countries move to tighten monetary policy, as the Bank of England increased rates by 75 basis points. In non monetary international news, we have seen North Korea launch numerous missiles into the sea recently, some coming close to South Korea, and escalations mounting in that region.

Deep Dive 📰

Be on the lookout for a new edition of our Deep Dive article dropping this week. I have been working on this deep dive for awhile now, so really looking forward to hearing your feedback on the format going forward.

US Markets 🇺🇸

Here is a performance summary for US Equities:

Here is a look at US Treasuries:

The Fear & Greed Index measures market sentiment based on the following seven factors: put/call ratios, junk bond demand, stock price breadth, market volatility, stock price strength, safe-haven demand, and market momentum.

When it comes to the Fear and Greed Index, in a matter of a few weeks we went from an Extreme Fear reading and now sit at a Greed rating after a strong run in the markets. Although we are seeing a Greed level after one of the best one month performances in the stock market in recent history, the overarching economy still has a lot of headwinds, so buyers beware. Currently, the index has a reading of 59, which is not much change from the prior week reading of 61.

Source

Earnings on Deck 💰

We have made it through peak earnings season for Q3, as 85% of the companies within the S&P 500 have reported results. Of those companies, 70% reported EPS beats, which is below the 5-year average of 77%, and many of those are slight beats. According to Factset, companies that beat on earnings did so by 1.9% above estimates, well below the 5-year average of 8.7%.

Here is a look at the companies reporting this week.

Source

Notable Analyst Updates 📝

• Baird increases PT on Honeywell (HON) to $225

• UBS downgrades Caterpillar (CAT) to HOLD, cuts PT to $230

• Barclays cuts Amgen (AMGN) to underweight

• Wedbush raises PT on Starbucks (SBUX) to $96

This Week 📆

Monday

• Consumer Credit

• Fed Officials Speak: Cleveland Fed President Loretta Mester, Boston Fed President Susan Collins, Richmond Fed President Tom Barkin

Tuesday

• ELECTION DAY

Wednesday

• Fed Officials Speak: New York Fed President John Williams

Thursday

• Initial Jobless claims

• CPI

Friday

• Veterans Day

• Consumer Sentiment

Other Resources 📺

If you have not done so yet, definitely check out my growing YouTube community where I publish weekly videos on Dividend Stocks I am looking at.

Here is a look at my latest video in which I cover 3 Top Dividend Stocks To Buy In November.

Also during the week, I did “Better Buy” video between home improvement giants Home Depot and Lowe’s.

Here are a few others of my latest videos:

Earn Dividends EVERY Month

Top 3 Dividend ETFs

5 FOREVER Dividend Stocks

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Have questions? You can email me directly at [email protected].

Have a Great Week!

Mark