vestact posted: " Market Scorecard US markets had a super day yesterday, closing firmly in the green. All three major indexes are on track to end the week in positive territory. Does it feel like we are gaining some upward momentum? Confidence is returning? We thin" Vestact - Money with a dash of funny
US markets had a super day yesterday, closing firmly in the green. All three major indexes are on track to end the week in positive territory. Does it feel like we are gaining some upward momentum? Confidence is returning? We think so.
In company news, Microsoft closed up 0.8% despite cutting guidance for international sales in the current quarter, because of the stronger US dollar. Elsewhere, online pet-products retailer Chewy rallied 24%, after delivering surprise profits. Bow wow, congratulations to their customers, the good dogs.
In short, the JSE All-share was up 0.26%, the S&P 500 packed on 1.84%, and the Nasdaq dazzled with a 2.69% gain.
Our 10c Worth
One Thing, From Paul
Fridays are for life advice and tips. I enjoyed this blog post by author David Yoon (pictured below) about how to cultivate creative endurance. He's talking about writing novels, but his observations are fairly universal.
He says he's able to churn out lengthy fiction because he has grit. That's not a personality trait or a special skill, grit is simply a set of good habits.
Some of his standout ideas are: (1) write in the mornings, (2) celebrate every milestone, (3) meditate or exercise, (4) avoid crap content, (5) sleep a lot, and (6) have a fun side hobby.
Byron's Beats
Critics have been piling on Jerome Powell (Chairman of the Fed) and Janet Yellen (Secretary of the Treasury) for saying last year that US inflation would be "transitory". Yellen actually apologised for being wrong this week, so her haters have been crowing.
People in power always attract criticism, and these seasoned veterans will know how to ignore the noise. They didn't expect the war in Ukraine or the second wave of Chinese Covid-lockdowns, which had an extra inflationary impact. In truth, we will never know if "team transitory" were right or wrong. We also don't know how the economy would have reacted if the Fed had acted earlier, hiking rates aggressively.
No one knows what the future will hold, all we can do is make calculated guesses based on probabilities and try our best.
Michael's Musings
Imagine earning R4 million a year and still living pay cheque to pay cheque. It can be tough out there. According to a LendingClub survey of 4 000 people in the US, 25% of those earning at least $250 000 a year are living this way. They have high expenses, clearly!
This is a reminder that wealth and income are not the same thing. If you spend too much you can't save, so having a high salary doesn't guarantee a comfortable retirement.
To be fair, people in this income bracket can easily cover the costs of their luxury lifestyle. If they do need to borrow money to cover an emergency, they are most likely to afford the repayments. They are willingly living on the edge.
Notably, in this survey, 78% of respondents said they were doing okay financially or living comfortably, the highest percentage since the Fed began this annual study in 2013. A happy consumer is good for economic growth.
Lululemon Athletica just posted strong earnings for the first quarter of 2022, thanks to double-digit growth in its direct-to-consumer business and good sales in its men's division. The athleisure company is also very positive on future sales since the rich people who buy their stuff don't seem to be affected by inflation.
The Vancouver-based company reported first-quarter revenues of $1.61 billion, up 32% year-on-year a new record for the first quarter. Online sales surged 32% and now contributes 45% of total revenues.
Lululemon's management runs a tight ship and I'm bullish on humans getting healthier and wanting to look good. We like this company a lot. Paul has been a shareholder for many years and runs in their kit. Consider adding this one to your portfolio, alongside Nike.
Linkfest, Lap It Up
The Canadian province of British Columbia has decriminalised the possession of small amounts of drugs. Portugal has the same policy and finds it helps to rehabilitate drug addicts - B.C. moves away from drug prosecutions.
Asian shares are following the improved mood in US markets, and trading higher this morning. Stocks rose in Japan and South Korea, while markets in Hong Kong and mainland China are closed for the Dragon Boat Festival public holiday. That sounds like fun.
US equity futures are flat, so far. US non-farm payroll data will be out an hour before the Wall Street open, and that may be influential. The Rand is trading at R15.47 against the US Dollar.
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