Stocks are back up again, at least that’s the sentiment from futures.
It was a day after Federal Reserve Chairman Jerome Powell assured lawmakers what markets already know – that a soft economic landing could be difficult while taming the inflation monster.
Along with regular investors, hedge funds have had a rough start to the year. Managers are down -0.56% in May, outperforming the Nasdaq by 1.49%, but lagging the S&P 500 SPX
by 0.57% according to a Eurekahedge report.
But one manager has made some gains this year. That’s AQR Capital Management founder Cliff Essence, whose global stock-market-neutral value strategy is up 48% so far this year, while his absolute return strategy has gained 35%, according to CNBC, which interviewed him late Wednesday. .
in our area Today’s callAsness presents a selection of stocks selected from his Quantum operation and challenges the same crowd on his AMC Entertainment AMC
short position. First, the star manager touched on the broader markets and how he feels about bonds that are hardest hit these days.
“We didn’t hate them six months ago,” Essence told CNBC. “If you force me, I’d say we’re negative on bonds, and also in the trend-following world that doesn’t really look at value and in the world of managed futures, we’re definitely short-term bonds.”
“I don’t think I can say that bonds are a game of value,” he said, going against two technical names he reluctantly shared. “That’s not to say that if we go into a recession there won’t be a huge uptick in bonds, but in terms of the things we compare returns to, bonds are considerably less catastrophic. But that’s dreadful with faint praise.”
Will its value be in trouble if a recession occurs? Asness said his strategies aren’t that sensitive to macro factors, in part because they don’t take big industry bets. “I don’t think we have a very straightforward bet on a recession versus no recession.”
He said they’re sticking with some value in the portfolio because they always want that offer especially “when it looks really, really cheap.” He said that while there was a dip in value in June, the hikes are so high that they’re tied to a tech bubble when it comes to relative prices between value and growth.
For value stocks that are within the rules of the game — cheap, profitable, low-risk, with good momentum — Asness points to tech giants Meta Platforms META.
and Amazon AMZNAnd the
Down 53% and 34% year-to-date.
“Meta and Amazon are generally loved by our process now. It’s cheap compared to its peers…we’re making industry comparisons and it’s not always perfect – Meta is social media and Amazon is online retailer…but they both look good in terms of A combination of value, profitability, and low-risk investment…Amazon is good for the three of us.”
In his broader interview with CNBC, Asness also set a challenge to memes, announcing a new short position for AMC Entertainment. “It’s horrible in all that we care about,” Assens reportedly said. “It’s very expensive, very unprofitable, and has a high beta volatility.”
“I dare all the same lunatics in the stock to try to harm us,” he said.
If we judge by Twitter reaction so far, The meme audience doesn’t seem to be holding back, while AMC is up 1.5% in the primary market.
“Giant money furnaces.” So Tesla TSLA
CEO Elon Musk describes the electric car maker’s latest build.
EV Group Polestar will appear on the Nasdaq on Friday after its deal with special purpose buyout firm Gores Guggenheim GGPI
It was accepted.
Stock in Darden DRI . restaurants
After its board of directors approved a $1 billion share buyback.
Accenture Securities ACN
It rolls back a profit loss for the consulting firm.
Warren Buffett Berkshire Hathaway Break
Purchase of 9.6 million exposed shares of Occidental Petroleum Oxy.
Those stocks are going up.
JPMorgan says investors have more money stashed away now, than they did during the early days of the COVID-19 pandemic.
Powell heads to his testimony for the second day on Capitol Hill, at 10 a.m. ET. US weekly jobless claims and deficit come before that, followed by US manufacturing and services PMIs from Standard & Poor’s Global.
ES00 . Stock Futures
Turned higher, with BX bond yields: TMUBMUSD10Y
dilutes, while oil CL
It continues to decline, after a day of settling at a six-week low. Bitcoin BTCUSD
It continues to swing around the $20,000 mark.
Auto supplier stocks have been largely priced into the recession, and “the tailwind is still shaking,” says Luke Junk, research analyst at Baird. He says investors are looking for “really drifting sectors”. You should take care of companies that deal with electricity, active safety and in-vehicle technology. GENTHERM THERM
and Aptiv APTV
They are two oversold names that stand out for Junk.
These were the most searched indicators on MarketWatch as of 6AM ET:
Six of the world’s most deliverable cities are located in Europe.
Parents of transgender children drain their savings to flee conservative countries.
A quick-thinking coach saved swimmer Anita Alvarez’s life in an international competition on Wednesday:
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