Stuff gets more expensive, stocks remain dear

Market Updates

Stocks were sold off heavily in response to this CPI data, before rebounding during the back-half of the week. The Nasdaq, for example, rallied 2.17% on Friday but was well down for the week as a whole. Valuations also remain stretched, with the S&P 500 trading significantly above its historical average.

Despite the sell-off in stocks, Jaaims continues to close off a number of mammoth winners, with some of our recent top performers including:

  • Hansen Technologies +31.26%
  • Mohawk Industries +29.06%
  • L Brands +28.16%
  • Daimler +27.57%

On a more granular level, popular US growth names were hit hard over the last five sessions as these inflation anxieties played out: Sea has fallen 7%, Tesla has lost 11%, Trade Desk has dipped 8.5%, and Coinbase dropped 3%.

Tesla had a particularly dramatic week. Shares were not only down, but the automaker’s rockstar CEO – Elon Musk – announced that the company would no longer accept bitcoin for the purchase of its vehicles.

There was significant social media backlash in response, and core cryptocurrencies, such as bitcoin, fell sharply as a consequence.

Why have growth names been hit so hard? Larry Swedroe, from Buckingham Strategic Wealth, told CNBC:

‘Growth stocks have longer duration than value because they have more of their earnings farther out.’

Upcoming Earning

Looking ahead, large-cap retailers such as Walmart and Home Depot are set to report their latest round of earnings this Tuesday.

Analysts are expecting Walmart to report quarterly earnings (EPS) of $1.21 and Home Depot is forecast to reveal quarterly earnings (EPS) of $3.03 – according to Yahoo Finance.

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