Capital Wealth DailyThe Fever Issue
Our read of the July 7 Wall Street Journal. Monday’s close, with every story tied to a move in the model books.
A record Dow and a 19-fold profit. We read the fever chart so you don’t catch it.
The Dow closed at a record 53,055.91 Monday. The real heat burned 6,000 miles west. Samsung pre-announced a quarterly profit up roughly 19-fold. SK Hynix kicked off a $28 billion U.S. listing. The Kospi is up 91% this year, with 77 daily moves of 2%-plus in twelve months. The S&P 500 has had five. On the market: Micron (MU) $984.75, Sandisk (SNDK) $1,744.43, Western Digital (WDC) +$38.46, AMD +$34.23 to $552.05, Marvell (MRVL) $249.27, Qualcomm (QCOM) +$10.23, and Nvidia (NVDA) up 72 cents. The market has decided memory is the bottleneck, and it’s paying the bottleneck first.
Our ReadTaiwan Semi (TSM, +$17.63 to $451.79) and Broadcom (AVGO, $373.90) stay in the reinforce column across all four Aggressive tiers. The toll collectors get paid whichever memory maker wins the sprint. We hold Micron (MU) at its tactical target and don’t add at $984. We bought the cycle. We’re not buying the encore. The same rule covers SNDK, WDC and the LRCX tooling leg. Korea stays index-only. Foreign investors pulled $100 billion out in the first half, while a 2x Hynix wrapper became the largest leveraged single-stock ETF on earth. Nothing in our book gets owned through a 2x wrapper. Nothing.
The Stories
6 stories · 3 pictured · 3 listed
Four giant banks circle Fiserv’s network. They want the loophole, not the plumbing.
JPM, GS and MS stay reinforced in the financials sleeve. KBW banks +1.88% led Monday’s whole market. Goldman (GS) was +$34.29 to $1,055.29, Morgan Stanley (MS) +$8.17, and JPM +$4.75 to $337.72. Fiserv (FI) goes on the watch bench as a takeover-interest situation, not a holding. Distress plus a fee loophole is a very specific kind of bid, and we let the banks pay to find out. Even the A-hed agrees. The hardest fight in the Fifth Third (FITB) and Comerica (CMA) merger is whether chili has beans. The fee machine underneath is fine.
Microsoft cuts 3,200 Xbox jobs and says “our business today is not healthy.”
MSFT stays a core holding in the Fundamentals Core tiers. Held, watched, not added to today. A company willing to say “not healthy” out loud is protecting the margins that fund the AI build-out. That is also why the book owns Dell (DELL, +$17.48 to $411.80) and the power names underneath it. It’s a core compounder, watched, not worshipped. And note that Samsung’s 19x quarter is now Xbox’s bill of materials.
Jet fuel fell 40%. Your fare didn’t, and the airlines say so with a straight face.
We own zero airlines, and Monday didn’t change that. DAL, UAL, AAL and LUV go on the watch list as a pricing-power case study, not a position. Cyclicals with wings get bought in recessions, not at records. The trait we’re really screening for is pricing power that outlives its excuse. That already lives in the book, more politely dressed, in AVGO and TSM.
Off Duty & The Life File
3 stories
Kids move home, parents need moving. That’s the re-bundled American household.
One story in three disguises, and every disguise is a line item. The multi-generation floor plan is a balance sheet with bedrooms.
$9 gas on a $1,483 Social Security check. That’s Alaska’s energy squeeze.
A fixed-income stress test nobody signed up for. It’s also the flip side of why the energy sleeve sleeps fine at $68 oil. COP is building the $9 billion Willow project up there.
A presidential call to FIFA, England’s Azteca escape, Haaland ends Brazil.
The World Cup had a bigger weekend than the Dow. Unlike the Kospi, it’s supposed to move 2% seventy-seven times a year.
From the desk Bias, the book, what’s priced, the planopen
A record Dow, with the VIX asleep at 15.57, the 10-year behaving at 4.479%, and oil peace-priced at $68.55. Leadership is broadening. Banks led (KBW +1.88%) while the AI complex rotated to hardware and power (GEV +$38.93 to $1,152.04, DELL +$17.48, VRT +$17.94, TSLA +$26.32, META +$17.39, GOOGL +$6.55). A record with rotation gets respected, not chased. The Kospi’s 77 fever days are the pulse chart. If that volatility jumps the Pacific, SGOV’s 4%+ is the waiting room.
- DJIA 53,055.91 ▲0.29% REC
- S&P500 7,537.43 ▲0.72%
- NASDAQ26,121.16 ▲1.1%
- 10Y4.479%
- 2Y4.124%
- WTI $68.55 ▼
- GOLD $4,155.10 ▲
- VIX15.57
- KOSPI +91% YTD
a record is the cheapest day to rebalance. Trim what ran, refill the ballast, and let the fever chart belong to somebody else’s portfolio.