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It’s almost the 11th hour; Joey Sending Petey to Beijing? Dash Makes its Debut – Try the Feta Shrimp

In yesterday’s note, I said:

“Remember – congress is due to go on vacation on Friday – and with no stimulus deal done yet, it just raises the temperature in the room… Now, I fully expect that there WILL BE a deal by end of the week – there will be an 11thhour deal where both sides will try to claim they won…”

Guess what??? The 11th hour is getting closer! Enter stage left – Treasury Secretary Stevie Mnuchin to the rescue! A Bloomberg article describes it like this:

“Treasury Secretary Steve Mnuchin made a SURPRISE RE-ENTRY into talks on a 2020 pandemic-relief package with a $916 billion proposal that opened a potential new path to a year-end deal despite objections from Democrats over elements of the plan.”

Now the re-entry is because he stepped back recently and left it to McConnell, Pelosi, Schumer and McCarthy to hammer out a deal – which they have been unable to do… so – DA, DAAAAHHH… in his usual ‘dramatic’ fashion – Stevey joins the group again – promising to come to the rescue – bringing that 11th hour deal within reach. After discussing it with (Lame Duck) President Trump – who supports it, Stevey offers up a $916 billion plan (again more than the $908 billion that the Dems proposed) – the deal includes  $600 stimulus payments to individuals, eliminating the $300 supplemental unemployment aid, (Dem oppose), it offers $160 billion in state aid for those states that have mismanaged their finances (you know who they are- something that the Dems are demanding) while also providing ‘robust’ protections (Liability shields) for employers from Covid-19 related lawsuits (something that the DEMS oppose)  – something that is sure to come which must be why the Democrats oppose it so vehemently… I mean I guess I’m wondering – Why would protecting employers from these lawsuits be such a dealbreaker for Democrats? Why are Nancy and Chucky so intent on letting frivolous – sure to be – ‘class action’ lawsuits to thrive? It’s simple – they want someone to be responsible for people getting sick… they want employers and insurance companies to foot the bill and pay up! The argument that employers should be responsible for protecting employees is at the root of it (and I do agree up to a point) … employers that force employees to return to work (without ATTEMPTING to protect them) run the risk of those employees getting sick – thus the Democrats want to hold those employers responsible… And this is a slippery slope for sure… because what’s next? Employees that fall and break a leg on their way to work will get the right to sue their employer because they ‘had to go to work’?  I mean – when does it stop? So, as long as the GOP wants to protect employers – the Dems won’t go for it… (I’d like to know which lobbying firm in DC is representing the lawyers!) and so this is unlikely to be resolved as long as the Democrats continue to craft a plan that not only allows but encourages these lawsuits. And so it goes… but don’t kid yourself – the 11th hour is coming… It’s all about the DRAMA… someone will blink…

In any event – when the news of the latest $916 bil deal hit the tape – the algo’s went into overdrive and did what? You guessed it- BUY, BUY, BUY… sending all the indexes higher – leaving the Dow up 104 pts or 0.35% just shy of a new record, the S&P up 10 pts or 0.28% to a new high, the Nasdaq up 62 pts or 0.5% to a new high and the Russell up 26 pts or 1.4% – not yet a new high (but surely on its way!). Tech, healthcare, energy, basic materials, and industrials all surged, Utes, (Utilities), financials, consumer discretionary and communications got hit. Value names outperforming growth names and it was a frenzy again… as the algo’s tripped over each other thinking that that there will never be a down day on Wall St!

And the news that the UK has launched the largest inoculation program in the history of the world only added to the excitement as the media focused on the ‘brave’ Brits that stepped up to be the first in line to get vaccinated… Now, it is a bit comical – because those brave Brits are more than 90 yrs old… which leaves you to applaud them, but begs the questions “What do they have to really lose?” Capisce? (Wink, wink). Either way – Maggie Keenan and Willy Shakespeare will go down in British history as the first to step up to the plate in the name of humanity and for that I wish them well!

Doordash – (DASH) the latest ‘tech’ IPO to come to market priced itself at $102/sh raising some $3.37 billion for 33 million shares of stock. Now I say it’s a ‘tech’ play because why not? I mean – I order food from a restaurant and pay for it – via my app on my phone – which then connects to a Doordasher – via an app on his/her phone – who then picks it up from the restaurant and then delivers it to my work or my home as instructed… all of the directions to the restaurant and then to me provided by google maps (via an app on your phone) while SIRI – an app on your phone – speaks to them giving them turn by turn instructions (sounds like UBER) to make sure that they have taken the fastest route allowing your food to be delivered still hot and delicious… did you notice all the TECH involved in this process? So DASH is not a delivery company – it’s a Logistics powered by TECH company, like UPS & FDX, that are also Logistics powered by TECH companies. (and by the way in fact every sector is a sector powered by TECH – financials, banks, energy, healthcare, retail, utilities, industrials, and everything else) And yesterday everything that is TECH surged… not just the FAANG names… (Hint – TECH isn’t going away – so make sure it’s a part of your portfolio!)

And the pricing of this IPO – to be traded on the NYSE today is testament to the investing frenzy that exists… and tomorrow it’s all about AirBnB! (ABNB) – And that too is another TECH company… Don’t kid yourself… it’s TECH! It’s Travel and Leisure powered by TECH – think about how you find, book and pay for your AirBnB. (Hint:  App on your phone) and their total addressable market – is over a trillion dollars… and I expect that their IPO pricing will be adjusted up before the end of the day as well.

US futures are mixed? WHAT?  Mixed? Impossible! Dow futures are +90, the S&P’s are +7 pts and the Russell is up 14 pts while the Nasdaq is off by 7 pts… (that is surely a mistake). Again – there is nothing new here… the vaccine is old news, the surging virus is old news, the stimulus talks are old news, so again – be careful… Yes – we are at the year’s high, all on old news… so I’m just sayin’ – Can the market go higher – of course, will it go higher? Of course, but can it also go lower? You bet… and I’m just sayin’ – don’t get pulled into the frenzy – this is exactly the time you need to use your head and stick to the plan… it is also the time to talk to your advisor to rebalance your portfolio in order to keep it growing without losing sight of the inherent risk. Which is why you have an advisor – because it is their job to protect your back(side). Capisce?

And in a headline that just crossed the tape – Joey is considering sending Petey (Buttigieg) to Beijing to become Ambassador to China – saying that it will set him up for running for President… or is it just a way to get him out of Kamala’s hair – so she can continue building her brand to step into that role.

In Europe – markets there are all up as well… the focus is squarely on the BREXIT talks between the UK and the EU. UK Pm BoJo is on his way to Brussels to dine with EU Commission President Ursula von der Leyen in a last-ditch effort to seal this deal. The focus on the vaccine rollout will be the subplot… but it will be there. At 6:15 am – FTSE +0.44%, CAC 40 +0.18%, DAX +1%, EUROSTOXX +0.49%, SPAIN +0.17% and ITALY +0.06%.

Oil is up 17 cts at $45.70 – the profit taking that earlier in the week sent oil a bit lower, now being met by buyers again as the vaccine story once again fuels the demand story… I mean just think about all the gas those DASHERS use to deliver food… never mind UBER, UAL. DAL. AAL, and all the other planes, trains, ships and automobiles. Don’t overthink it – the recovery is happening (although it doesn’t feel like it right now) and with that will be the re-opening trade that includes energy and oil. We are well within the $40/$50 range as it builds a base right here in the mid 40’s.

Gold is holding steady at $1862/oz while Bitcoin falls another $480 bucks to $18,295/coin.

The S&P closed at 3702 – breaking that psychological 3700 big round number and is sure to excite the algo’s… leaving the S&P this year to trade in a range of 2191 on March 23 to 3702 on December 8th.  A stunning 1500-point range… and WHO out there ever expected that to happen last January? In any event – it feels like its churning… I said I thought 3700 would be the high for the year and now the markets will churn into year-end… Renewed lockdown restrictions, are now being challenged all across the country – the possibility of a deal and normal re-allocation and re-balancing is what is driving the markets. Today we might get some more news about the stimulus… it will be interesting to see how this plays out in the next 48 hrs… Will the Dems back off on liability shields and will the GOP embrace more stimulus for individuals? I still believe that the market is consolidating… and continue to believe that we are at the highs. Either way – it is what it is…

Remember we are now in unchartered territory… we are smack in the middle of a very broad trendline channel… 3400/3900… and we are only weeks away from year end – estimates for the S&P next year range from a 5% to a 20% increase… Me? Tell me what’s gonna happen next year and I’ll be more comfortable giving you a target… in any event – it’s about being in the market – like the lotto says – You have to be in it to win it! While the algo’s could attempt to push us a bit higher – I believe that the smart money will most likely unload some of the highflyers as they expect a re-pricing in the early part of the new year.  As the long-term investor – stay focused and stay the course, keep balanced.

Take good care.

Kp

No. 5 – Feta Shrimp

Feta Shrimp – This one is easy and can be served a number of ways. Either in a large bowl with toasted garlic bread or over a pasta – maybe like an Orecchiette or over white rice…

For this you will need: 2 lbs of large cleaned and deveined shrimp, sliced garlic (a lot), thin sliced plum tomatoes, feta cheese, butter, s&p, olive oil & Madeira wine. * you can prepare all of this ahead of time and place in bowls to have ready for you when you are ready to cook.   The thing about this dish is – you have to make it and serve it right away…

Begin by heating up ½ stick of butter and some olive oil on med high heat. Add a handful of sliced garlic and sauté for 4 mins or so…do not burn.  Next add in enough shrimp so that you cover the bottom of the pan – do not pile them on top of each other… When they turn pink – flip them over.

Now add enough Madeira wine to “bathe” the shrimp – (do not drown or cover them in wine) – Turn heat to hi… season with s&p, place sliced plum tomatoes all over and then top with crumbled feta cheese.  Cover and allow the steam to soften the tomatoes and soften the cheese. No more than 3 mins. Remove and place in a large serving bowl.  Repeat process until you have cooked all of the shrimp. When serving – make sure that you have enough garlic bread for your guests.

*if you are putting over pasta – then boil the pasta – strain and mix adding extra feta cheese to the hot pasta to help make it creamy and delicious.

Buon Appetito.

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Stimulus, stimulus and more stimulus… investors were held in check yesterday as legislators in DC all promised to ‘not go anywhere until this is done’… Not sure they had much of a choice – and in fact – I would say it’s their own fault… They could have had this all done months ago – but each side chose to play the partisan game vs. the right thing to do…

Kenny Polcari

Kenny is the editor of Morning Thoughts and has been with Seven Figure Publishing since 2019.

Kenny is a CNBC exclusive contributor appearing on shows like The Halftime Report, Power Lunch, and Closing Bell. His market commentary has reached audiences across the nation on media outlets such as Bloomberg, Fox, ABC, and more.

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