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Our Market Narrative… 📊

It is time to be bullish. That’s the narrative and there are multiple reasons why.

On Wednesday, we got a CPI report that came in hot, and the market immediately sold off. Treasury yields rose 10 basis points, and the equity markets declined 1%. As the day continued, the market climbed positive, and the Nasdaq ended in the green.

CPI in January is usually higher due to seasonality trends, and I believe that is what we saw in yesterday’s report. The market digested the information and eventually showcased positive signs.

President Trump tweeted throughout Wednesday about a call he had with Vladamir Putin regarding a peace deal in Ukraine. If a peace deal gets brokered in Europe, we will most likely see energy prices decline.

The CPI report came in hot largely due to elevated energy prices. With energy prices coming down due to an end of the war, inflation may cool. This will be positive for the market, as treasury yields will decline, and equities will rise.

Another recent positive sign is the new “Lag 7.” The Mag 7 has not had a strong year so far, and 5 of the 7 stocks are negative. However, the market is up over 3%, showcasing a strong sense of broadening out. Investors have been talking about a broadening out for over a year, and it may finally be here.

Lastly, the main factor driving growth in the market this year is going to be earnings. Earnings season is practically done, and 77% of companies have beat estimates. Earnings are expected to grow 13% this year and next, and I believe there could be more growth.

 I expect continued volatility over the next couple of months, but ultimately believe we are set up for a strong year in the market.

As always, be positive, get invested, and stay optimistic!

Top ETFs on our Radar… 📈

ARKB is the ARK 21Shares Bitcoin ETF, a spot Bitcoin ETF launched by ARK Invest and 21Shares, providing direct exposure to Bitcoin while being tradable on traditional stock exchanges. It offers investors a regulated and convenient way to gain Bitcoin exposure without needing to manage private keys or custody solutions.

Tune in every Monday and Friday for in-depth Market Analysis, Recaps, and a featured Stock & ETF.

Thanks for reading and have a great week!

-Ryan

@Theinvestingauthority