Thanks to a Softer than Expected CPI Number, Equities Soared Today

Tom Gentile

Posted in Big Picture

By: Tom Gentile on November 10th, 2022 • 2 mins read

The Consumer Price Index (CPI) for October was a good number.  What was good about it?  The fact that it WASN’T as good as expected.  Wait, what?

The CPI saw a 7.7% increase over last year and 0.4% increase over the prior month.  Both of these numbers are better than Wall Street expected. Economists were calling for a 7.9% annual rise and 0.5% monthly gain.

Last month Fed Chairman Powell informed the markets a pivot or policy shift isn’t guaranteed,

Investors were able to disregard that, at least for a day today as this CPI data once again fueled data the Fed could ease the pace of their monetary tightening plan.

Across the Board Stock Buying

Readers of this Daily Market Insight education knows we have been encouraging folks to focus on sectors they feel will benefit with earnings (good or bad) and the mid-term elections that are still not yet finalized to ascertain what sectors will respond and in what direction based on results of all that.

Today, one didn’t have to try that hard to find a sector that is outperforming it seems as buying was prevalent across the board with all 11 sector SPDR ETF’s showing gains for the day.

The leading sector on the day was Tech, Ticker XLK.

One can click on the ticker in the sector SPDR website and bring up the list of holdings for XLK and do further research on that list with your broker(s) to ascertain which one you all feel most confident for higher prices.

Of course, if one feels this move today can’t be sustained and the markets, this sector or individual components could see some profit taking and peel back in share price there is the option, pardon the pun of looking for bearish option trade ideas.

We are more in favor of operating based on the ‘Trend is your Friend’ ideology and looking for stocks that we feel have further upside and research bullish option ideas on those.

Major Index Gains for the Day

  • The Dow closed up 1.201.43 points or 3.70%
  • The NADAQ closed up 760.97 points or 7.35%
  • The S&P500 closed up 207.80 points or 5.54%
Figure 1: Sector Tracker for the Day 2022-11-10
Figure 1: Sector Tracker for the Day 2022-11-10

App: Toms Option Tools

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Other times I will have other charts may work to amplify my educational points. 

Those options data lists, however, can be found on my app Tom’s Option Tools. Use your device to search up and download this app and get free access to the Morning Reports section of the app.

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