Wait For The First Quarter Announcements

In hisDaily Market Notes report to investors, while commenting on the first quarter announcements, Louis Navellier wrote:

Buy Energy

This week is all about inflation. China announced on Monday that its consumer prices soared 1.5% in March. Specifically, China’s National Bureau of Statistics reported that fresh vegetable prices rose 17% in March, while fruit prices rose 4.3% and flour prices rose 4.6%. Wholesale prices rose 1.1% in March, up from 0.5% in February. China is experiencing more bottlenecks as its Shanghai province remains closed due to Covid-19. In fact, electric vehicle manufacturer, NIO, had to follow Tesla and shut down its production.

Q4 2021 hedge fund letters, conferences and more

If you do want to buy energy, especially crude oil, today's a great day to do so. Natural gas prices I should add are still rising because of strong LNG exports.

Crude oil prices are now at six-week lows due to fears of slumping global demand due to China’s Covid-19 shutdown as well as a recession enveloping Europe. There are also frustrated voters in many countries, such as in France where President Emmanuel Macron will have a runoff election with nationalist Marine Le Pen. More countries are reverting to nationalistic tendencies as globalization fails due to supply chain woes.

What Rattles Investors

Treasury yields continue to rise as the Fed unwinds its quantitative easing. The 10-year Treasury bond yield rose above 2.75% to its highest level in three years. However, soaring intermediate yields and the threat of more yield curve inversions is what really rattles investors.

This week’s first-quarter announcements by many financial institutions are expected to shed further light on whether or not an inverted yield curve will squeeze financial stocks’ operating margins. Some of them will have to have some write-downs because of their exposure to Russia. But by and large, their earnings are going to be very good because of very low consumer default rates.