The market's 'fear gauge' just hit its lowest level since January 2020 (2 min read) The CBOE Volatility Index (VIX) has reached its lowest level since January 2020, which does reflect the strong rally in US large-cap equities so far this year. However, the consumer sentiment index remains low, indicating a divergence between consumer sentiment and investors. The gap between the two suggests that either consumers will become more optimistic or there will be a market panic reflecting depressed sentiment levels. The catalyst for either scenario could be just weeks away.
US Treasury Secretary Yellen Sees Lower US Recession Risk, Says Consumer Slowdown Needed (4 min read) Treasury Secretary Janet Yellen believes the risk of a recession in the US has diminished and suggested that a slowdown in consumer spending may be the price to pay to contain inflation. Yellen acknowledged the Fed's tightening policy but sees optimism due to positive economic indicators like the resilience of the labor market while inflation was coming down. The idea of raising the inflation target from the current 2% target was proposed but she dismissed it and said the focus should be on containing the price surge.
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Business & Stocks
Starbucks workers at over 150 stores to go on strike over Pride decor dispute (3 min read) Over 3,000 workers at 150 unionized Starbucks stores in the US are going to strike this week in response to allegations that the company banned Pride Month decorations at certain locations. The union that organized the strike said fair labor contracts were also a contributing factor as well. Starbucks denies the claims and states that there have been no changes to its policy on celebrating Pride Month. The company plans to staff stores with workers from nearby locations during the strike. Shares of Starbucks fell nearly 3% on Friday after the news.
Tesla Win Streak Might Snap; Here's 2 Buy-the-Dip Spots (2 min read) Tesla stock has experienced a significant rally, surging over 80% since its April low and more than doubling since January. The gains have been fueled by investors pouring money into mega-cap tech stocks and the recent supercharger deals Tesla signed with Ford, General Motors, and Rivian. While the stock's five-week winning streak may come to an end soon, this article suggests two key dip-buying spots to watch based on technical analysis. The first level is near the stock’s 21-day moving average and the second level is near its first-quarter high.
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Funds & ETFs
Are Value ETFs Finally Priced to Move? (3 min read) The recent underperformance of value stocks compared to growth stocks is causing concern among investors. This decline in relative performance is the worst since 2000, a significant period marked by the three-year bear market. Despite the strong performance of growth stocks, ignoring this value/growth disparity could be risky. Some experts suggest that there may be an opportunity for value stocks to revive, as seen during the dot-com bubble burst. This article highlights several value ETFs with proven track records that are worth taking a closer look at.
How Investors Are Using Single-Stock ETFs (Podcast) Direxion is known for its leverage and inverse ETFs. One of their most popular funds is also the largest single-stock ETF on the market, the Direxion Daily TSLA Bull 1.5X Shares (TSLL), which may soon be the first in this rising niche category to reach $1 billion in AUM. This 17-minute podcast is with the managing director of Direxion where he discusses who is using their single-stock ETFs and how they are being used.
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