To The Moon

US stocks continued to drift to a lower close on Thu, 03 Aug 2023 as Wall Street’s red-hot rally cooled further yesterday.

When market closed:

• DJIA: -0.19% (-66.63 to 35,215.89)

• S&P 500: -0.25% (-11.50 to 4,501.89).

• Nasdaq: -0.10% (-13.73 to 13,959.72).

Some analysts have explained that Treasury yields surged could have siphoned off some of the resources, as Wall Street continued to assess the fallout from ratings agency Fitch's downgrade of US credit.

Afterall, the benchmark 10-year yield jumped to a very attractive 4.18% on Thursday.

US Composite Index - Technical Analysis.

• Both S&P 500 and Nasdaq’s index are below their respective 20-day moving average.

• They are in a short-term downtrend.

• With an RSI reading in the fifty-range, all indexes are not overbought or oversold.

Yesterday also saw the release of US weekly jobless claims’ data (see above).

• US Dept of Labour (DOL) reported an initial jobless claims totaled 227,000 in the week ending 29 July, in line with market expectations.

• This is an increase of 6,000 initial claims (or +2.71%) from last week’s data.

• The relatively “small” increase underscores stubborn tightness in US labor market, aligning with other key labor data released this week.

• More importantly, it backs the possibility that the Fed may still extend its tightening cycle this year; with the next FOMC penciled for September 2023.

In light of all that have taken place or is happening (see below),

• March banking crisis.

• Persistent inflation.

• High interest rate.

• Escalating debt.

• US Treasury credit downgrade (latest!)

Are there still opportunities to be had?

In my post, dated 03 Aug 2023, (click here! to read) I have shared the followings:

Following up on that, one other possible stock to consider would be:

• $Costco(COST)$, a retail giant has benefitted from increased consumer demand for groceries and household essentials amid the pandemic and an inflated economy.

• It operates 858 warehouses with an international presence in the following countries - US, Puerto rico, Canada, Mexico, Japan, the UK, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand and Sweden.

• It has reported an impressive sales growth in July, with comparable sales up 13.2% year-over-year.

• On 02 Aug 2023, it reported a net sale of $214.53 Billion, that’s a +4.6% gain, YoY.

• It pays a regular dividend and occasionally issues a special dividend, which could reward its shareholders.

• The stock has a “Buy” rating consensus.

• Looking at the stock’s performance over (i) a 5-day period and (ii) 6 months (see above).

• It could be inferred that in the immediate term, stock movement is largely influenced by market sentiments.

• Looking at the stock’s past 6 months performance, it has gain +8.17% overall.

• With an RSI reading of “62”, it is not overbought yet; meaning opportunity abound?

What I Think:

• This is really a pedigree stock.

• At $557 per share, it is a bit steep for my pocket.

• I am opened to fractional shares investment and hopefully grow my holdings overtime.

• Will monitor this stock more closely from now onwards.

• Do you think Costco is a stock you would look into?

• Do you think US market will continue to correct or will regain its upwards momentum soon?

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