To The Moon

Staring at US pre-market indicators for Friday and knowing how volatile market is these days- I think US market might have minor adjustments and may end on a mixed note today.

Although the indicators are in the green zone and yesterday’s 3 official reports injected a much need confidence back into the market, caution is still paramount.

(1) US Producer Price Index (PPI).

• US’s August Core Producer Price Index (PPI) - that excludes food & energy increased by +0.2$ (MoM), in line with expectations polled by Dow Jones.

• Core PPI YoY (see above) came in “weaker” at 2.2%, compared to July’s report of 2.4%.

• Taking into considerations Core CPI report (out on Wed, 13 Sep) that also reported a “dip” for August report

• This is a clear signal to the Fed that its restrictive interest hike policy is taking its effect, albeit over a longer period than anticipated.

(2) US Retails Sales Report.

• US Retail sales for August 2023 remained vibrant, dipping marginally to 2.47%.

• This is a decline of -0.17% from July’s report.

• Another step in the “right” direction as far as the Fed is concerned.

(3) Weekly Jobless Claims.

• For week ending xx Sep 2023, jobless claims came in at 220,000 versus market expectations of 225,000; or -2.22% lower than market expectations.

• Compared to last week’s report, jobless claims have risen by 3,000 or +1.38%.

• However, if we were to take a “4-week moving average of claims”- a less volatile measure, report actually fell by -5,000 to averaged-out 224,500.

• Another piece of “good” news for the Fed.

Summing up the above 3 reports, it is the “perfect framework” of inflation heading in the right direction and to top it off, the US economy is not falling apart.

Wall Street knows it too and just like that it rallied on Thu, 14 Sep 2023.

By the time market closed:

• DJIA: +0.96% (+331.58 to 34,907.11). Its best rally in over a month; closing above its 50-day ma.

• S&P 500: +0.84% (+37.66 to 4,505.10).

• Nasdaq: +0.81% (+112.47 to 13,926.05).

• With much fanfare, $ARM Holdings Ltd(ARM)$ brushed off the critics in fine style on its IPO debut Thursday.

• The chip designer stock closed toward the upper end of the day's range, ending the day with a muscular +24.7% gain.

• Priced at $51 per share and an issue volume of 95.5 million shares, this gave Arm an initial valuation of $54.5 Billion.

• The IPO raised nearly $5 billion for majority owner SoftBank that still owns 90% of Arm stock.

• Skepticism that was attached to the stock while it headed into its debut, has but all waned into nothingness.

• This UK based chip designs have a pedigree of who’s who clients that includes the likes of $Apple(AAPL)$ , $Advanced Micro Devices(AMD)$ , $NVIDIA Corp(NVDA)$, $Taiwan Semiconductor Manufacturing(TSM)$ just to name a few.

Honestly what is there not to like about Arm Holdings?

• Do you think US market will end on a “high” this Friday?

• Do you think ARM will continue to reach for the sky today?

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