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[192.64.236.86]) by mx.google.com with ESMTPS id a21-20020a056808129500b0032e1ad6fabfsi37643650oiw.244.2022.06.10.04.38.28 for (version=TLS1_2 cipher=ECDHE-ECDSA-AES128-GCM-SHA256 bits=128/128); Fri, 10 Jun 2022 04:38:29 -0700 (PDT) Received-SPF: pass (google.com: domain of delivery_20220610073816.28008239.802440@bouncest.seekingalpha.com designates 192.64.236.86 as permitted sender) client-ip=192.64.236.86; Authentication-Results: mx.google.com; dkim=pass header.i=@seekingalpha.com header.s=sailthru header.b=Pxu5FpEb; spf=pass (google.com: domain of delivery_20220610073816.28008239.802440@bouncest.seekingalpha.com designates 192.64.236.86 as permitted sender) smtp.mailfrom=delivery_20220610073816.28008239.802440@bouncest.seekingalpha.com; dmarc=pass (p=QUARANTINE sp=QUARANTINE dis=NONE) header.from=seekingalpha.com DKIM-Signature: v=1; a=rsa-sha256; c=relaxed; s=sailthru; d=seekingalpha.com; h=Date:From:Reply-To:To:Message-ID:Subject:MIME-Version:Content-Type: List-Unsubscribe; i=account@seekingalpha.com; bh=yAamIKJ1o2WE2Kenum6yVVwpolrUYysIS57XEWO4h5g=; b=Pxu5FpEbdJ5+y2liUXGjdPWSJZpC8aOX5wqmYe0BuAp21hMWlqBV1jZIIK/8OGAIerFo4rNHvHHy JOdOxIJdCDrQuX7eK/8tjvg7TvecQ/UhvRold5d8GkxvhWMZGxLmrvZhLlZCSLkIT3WiD07aN77Y FxUqrahx05r/NKjjyy0= Received: from nj2mta-16.sailthru.com (204.153.121.16) by pmta237-67.sailthru.com id hkcmja2to8c5 for ; Fri, 10 Jun 2022 07:38:17 -0400 (envelope-from ) Date: Fri, 10 Jun 2022 07:38:16 -0400 (EDT) From: Seeking Alpha Reply-To: wsbfeedback@seekingalpha.com To: sterlingwhg@gmail.com Message-ID: <20220610073816.28008239.802440@sailthru.com> Subject: Wall Street Breakfast: CPI Time MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="----=_Part_29930717_2088310154.1654861096802" Precedence: bulk X-Feedback-ID: 9033:28008239:campaign:sailthru X-TM-ID: 20220610073816.28008239.802440 X-Info: Message sent by sailthru.com customer Seeking Alpha X-Info: We do not permit unsolicited commercial email X-Info: Please report abuse by forwarding complete headers to X-Info: abuse@sailthru.com X-Mailer: sailthru.com X-JMailer: nj1-oddturquoise.flt X-Unsubscribe-Web: https://email-st.seekingalpha.com/oc/60c1e5c4dba83e59149ff347goban.h760/9e7e2ff8 List-Unsubscribe: , X-rpcampaign: stnjl28008239 X-Spam-Status: No, score=3.5 X-Spam-Score: 35 X-Spam-Bar: +++ X-Spam-Flag: NO ------=_Part_29930717_2088310154.1654861096802 Content-Type: text/html; charset=utf-8 Content-Transfer-Encoding: quoted-printable
CPI time - The next big test for the markets arrives at 8:30 a.m. ET as the= Bureau of Labor Statistics discloses its latest print on U.S. inflation. T= raders already got nervous in the previous session, with the Nasdaq plungin= g nearly 3% and the Dow posting a decline of more than 600 points. "There's= a bit more chatter, call it whisper numbers, for the Consumer Price Index = being a little north of expectations," said Liz Ann Sonders, chief investme= nt strategist at Charles Schwab.Snapshot: The consensus estimate among econ= omists predicts an 8.3% increase for the main CPI number, which would match= last month's figure, but mark a slight slowdown from the record 8.5% seen = in March. Market sentiment could get dented if today's reading comes in hig= her than 8.3%, but may also get bolstered if it matches expectations or sho= ws slower gains. Wall Street would take that as a sign of a peak in price p= ressures, with the Fed needing to be less aggressive in its tightening cycl= e later this year.A fair dose of pessimism is still out there as soaring en= ergy prices show no sign of abating and price tags continue to be marked up= at the supermarket. Last month, the services sector also accounted for abo= ut 40% of inflation, which will be harder to reverse and risks becoming mor= e embedded in the U.S. economy. Core CPI, which excludes volatile food and = energy, could provide some more clarity on that front and is expected to co= ol further to 5.9% Y/Y in May (from a prior 6.2%).Commentary: "I said last = month that we needed to see headline CPI drop below 8%," KPMG senior econom= ist Tim Mahedy wrote in a note. "This makes another 50 bps hike in Septembe= r increasingly likely... and the Fed pushing rates above neutral in the fou= rth quarter. We're running out of time, and there are a lot of reasons to t= hink that inflation will ease, but it will be more gradual than the Fed wou= ld like." (31 comments)
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Top News
CPI= time
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The next big test for the markets arrives at 8:30 a.= m. ET as the Bureau of Labor Statistics discloses its latest print on U.S. = inflation. Traders already got nervous in the previous session, with the Nasdaq pl= unging nearly 3% and the Dow posting a decline of more than 600 points. "There's a bit more chatter, cal= l it whisper numbers, for the Consumer Price Index being a little north of = expectations," said Liz Ann Sonders, chief investment strategist at Charles= Schwab.

Snapshot: The consensus estimate among economists = predicts an 8.3% increase for the main CPI number, which would match last m= onth's figure, but mark a slight slowdown from the record 8.5% seen in Marc= h. Market sentiment could get dented if today's reading comes in higher tha= n 8.3%, but may also get bolstered if it matches expectations or shows slow= er gains. Wall Street would take that as a sign of a peak in price pressure= s, with the Fed needing to be less aggressive in its tightening cycle later= this year.

A fair dose of pessimism is still out there as soaring e= nergy prices show no sign of abating and price tags continue to be marked u= p at the supermarket. Last month, the services sector also accounted for ab= out 40% of inflation, which will be harder to reverse and risks becoming mo= re embedded in the U.S. economy. Core CPI, which excludes volatile food and= energy, could provide some more clarity on that front and is expected to c= ool further to 5.9% Y/Y in May (from a prior 6.2%).

Commenta= ry: "I said last month that we needed to see headline CPI drop bel= ow 8%," KPMG senior economist Tim Mahedy wrote in a note. "This makes anoth= er 50 bps hike in September increasingly likely... and the Fed pushing rate= s above neutral in the fourth quarter. We're running out of time, and there= are a lot of reasons to think that inflation will ease, but it will be mor= e gradual than the Fed would like." (31= comments)

     
Featured
When will = the market sell-off end?
Inflation persists. An economic slowdown= looms. Stocks fell again yesterday.

But it=E2=80=99s almost imp= ossible to time the bottom. When stocks rebound, it's often extremely sudde= n, before you have a chance to buy.

The question is: Which stocks are becoming attractive to bu= y now?

On Seeking Alpha, you can evaluate any stock in seconds with our exclusive= stock ratings, and by its valuation, growth, and profitability grad= es. Our =E2=80=98Strong Buy=E2=80=99 stock picks are outpe= rforming the S&P 500 by 14% YTD.

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Economy
Recession talk

The national average price at the pump has surpassed $5.00 per gallon, according = to GasBuddy, an industry consultant that surveys prices at more than 150K s= tations nationwide. The average from AAA is also likely to reach that level= this weekend, with prices standing at $4.986 per gallon as of early Friday= . For energy investors, the supply-demand imbalance appears most acute in t= he refining sector, where names like Valero (VLO), HF Sinclair (DINO) and Par Pacific (PARR) stand to benefit from record margins, while = integrated producers like Exxon (XOM), BP (BP) and Chevron (CVX) are better equipped to m= anage a refining bottleneck than upstream peers.

Recession worri= es: It's unclear where the breaking point is, but gasoline underpins m= uch of the economy, from transport and travel to production and constructio= n. It also guides a significant amount of consumer behavior, as well as inf= lation expectations, which can have even more damaging consequences on the = economic outlook. Many see trouble in store if fuel prices continue to rise= , or stay at elevated levels for an extended period of time, though Treasur= y Secretary Janet Yellen said Thursday that "there's nothing to suggest tha= t a recession is in the works" after admitting last week t= hat she was wrong about the trajectory of inflation.

Rule of 10?= There's a theory out there that the U.S. economy generally runs into = trouble when interest rates (the cost of money, which everyone uses) togeth= er with energy prices (the cost of energy, which everyone uses) reaches dou= ble digits. To calculate the indicator, the average rate on the 30-year fix= ed-rate mortgage (5.23% as of Thursday) is added to the prices = at the pump (now averaging $5).= The rule was coined by Strategas chief eco= nomist Don Rissmiller in 2011, when the U.S. was still recovering from the = global financial crisis.

Outlook: "The economy is d= efinitely on thin ice here, but I don't think we're there yet," said Mark Z= andi, chief economist at Moody's Analytics. "If we get to $5.50 or $6 [gaso= line], that would be consistent with $150 for a barrel of oil. I think then= , we're done. We're in for a recession. It would be too much to bear. I thi= nk we could digest $120 [oil] if we don't stay there too long." (11 comments)

     
Earnings
DocuTumble
DocuSign (DOCU) went deep into = the red in after-hours trading on Thursday as the stock cratered as much as 26% to $64 following weaker-than-ex= pected Q1 results. EPS fell well= short of estimates for $0.46, though revenue topped projections at $588.7M= (+25.5% Y/Y). Before adjustments, the electronic-signature tech company al= so reported a net loss that widened to $27.4M for the quarter, compared wit= h a loss of $8.4M in the period a year ago.

Bigger picture: As the investors conti= nue to worry about the economy, there has been a shift away from a focus on= growth to profitability. DocuSign put up some strong growth early on in th= e pandemic, given the increase in online transactions, but business has slo= wed in recent quarters and the company is attempting to fix its go-to-marke= t challenges. Earlier this week, DocuSign announced an expansion o= f its partnership with Microsoft (MSFT), but it doesn't look like that will be enough for investors= .

Full-year revenue guidance was maintained at $2.47B-$2.48B on the= top line, but the mid-point of that range slightly missed consensus estima= tes. Revisions could also happen in the future, though DocuSign CEO Dan Spr= inger is confident about the outlook. "With over a billion users worldwide,= the proven value of our products, and the significant opportunity we have = ahead of us, we're confident in our ability to successfully navigate the ch= allenges of a dynamic global environment."

From the SA comments section: "Did Cathie [Woo= d] buy the dip?," asked Yuji__0. "This stock can fall another 50% and will = be still overvalued," commented ddca48. "Might get interesting in the low $= 40s and a PE in the 20a," added khansfman09, while scorpionblue speculated = about a merger. "Is this better than $dbx? maybe they should merge, the kin= gs of sbc. docudropsign." User donzoab is taking the other side of the argu= ment, saying it's too early to point to doomsday. "Docu will be fine. Over = time this cycle will reverse... I have no idea what the bottom is, but from= here and lower, it's a strong buy." (74 comments)
     
Consumer
Open-bathroom p= olicy

The battle over the Starbucks (NASDAQ:SBUX) bathroom has resurfaced followin= g comments from longtime CEO Howard Schultz, who returned to the helm o= f the company back in April. "We have to harden our stores and provide safe= ty for our people," he told The New York Times DealBook D.C. P= olicy Forum, attributing the U-turn to security issues. "I don't know = if we can keep our bathrooms open."

Backdrop: The company a= nnounced its open-bathroom policy in 2018 in response to an incident in whi= ch two Black men were arrested at a Starbucks in Philadelphia. The pair wer= e reported to the police by an employee after they were denied use of the s= tore's bathroom and were asked to leave because they hadn't made a purchase= . When they did not comply, the store manager called the police, saying the= men were trespassing, and a viral video of the incident went on to make na= tional news and prompt outrage against Starbucks.

In response, the c= offee chain apologized for the event and closed all of its U.S. stores for = a day for staff to attend an anti-bias training. Schultz, who was executive= chairman at the time, influenced the decision to open "restrooms, cafes an= d patios" to all customers regardless of whether they made a purchase. "We = don't want to become a public bathroom, but we're going to make the right d= ecision 100% of the time and give people the key, because we don't want any= one at Starbucks to feel as if we are not giving access to you to the bathr= oom because you are 'less than.'"

Outlook: Starbuck= s is dealing with other sensitive workplace situations as of late, like a u= nion drive that is strengthening across the country. "We can't ignore what is happ= ening in the country as it relates to companies throughout the country bein= g assaulted, in many ways, by the threat of unionization," Schultz told bar= istas on his first day back as Starbucks CEO in April. Shares of the compan= y have fallen with the broader market this year, tumbling 32% YTD. (24 comments)

     
Today's Markets
In Asia, Japan -1.5%. Hong Kong -1.4%. India -1.8%.In Europe, at midday, London -1.3%. Paris -= 1.8%. Frankfurt -1.6%<= /span>.
Futures at 6:20, Dow -0.3%. S&P -0.2%. Nasdaq +0.= 1%. Crude +0.7% to $122.37. Gold -0.4% to $1844.90. Bitcoin -1.9= % to $29,935.
Ten-year Treasury Yield -1 bps to 3.03%
Today's Economic Calendar
8:30 = Consumer Price Index
10:00 Consumer Sentiment
10:00 Quar= terly Services Report
1:00 PM Baker-Hughes = Rig Count
2:00 PM Treasury Statement<= br>
Companies reporting earnings toda= y =C2=BB
What else is happening...
Facebook parent now trading under META, unfriending FB sy= mbol.

JetBlue (JBLU) and American (AAL) will head to trial in fight to save alliance.

Famed investor Druckenmiller says current bear = market has a 'ways to run.'
Wells Fargo (WFC) r= esponds to NYT = article on federal criminal probe.

Disney (DIS) fires top TV executive as= board backs CEO Chapek.

Tesla (TSLA) Autopilot safety probe is expanded to 830,000 vehicles.

It's official: DiDi Global (DIDI) to delist fro= m NYSE on June 10.

Alibaba (BABA) drops as China regulator denies revived Ant IPO report.

Meta (<= a href=3D"https://email-st.seekingalpha.com/click/28008239.802440/aHR0cHM6L= y9zZWVraW5nYWxwaGEuY29tL3N5bWJvbC9NRVRBP21haWxpbmdpZD0yODAwODIzOSZzZXJpYWw9= MjgwMDgyMzkuODAyNDQwJnVzZXJpZD0zNTM4NDUxNSZzb3VyY2U9ZW1haWxfd3NiJm1lc3NhZ2V= pZD13YWxsX3N0cmVldF9icmVha2Zhc3QmdXRtX3NvdXJjZT1zZWVraW5nX2FscGhhJnV0bV9tZW= RpdW09ZW1haWwmbGN0Zz02MGMxZTVjNGRiYTgzZTU5MTQ5ZmYzNDc/60c1e5c4dba83e59149ff= 347C2f7705dc" title=3D"Meta Platforms, Inc.">META) backs off AR glasses= as unit looks to cut costs - The Information.

Advanced Micro Devices (AMD) details strategy to drive next phase of growth.
Seeking Alpha=E2=80=99s Wall Street Breakfast Podcast
Seeking Alpha's Wall Street Breakfast podcast brings you all the news you n= eed to know for your market day. Released by 8:00 AM ET each morning, it is= a quick listen that you can put on as you get ready to start your working = day.
 
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