Gibbs: Consumer discretionary and housing stocks are showing sell signals

How do you see today shaping up? What's your wax word of the day? It's my wax word of the day is rate boost and this I know we like to talk about equities and how higher interest rates hurt equities, but we really want to think about it as how it fundamentally benefits many investors as well as large corporations. They're earning more interest off of their cash positions. We know that most investors on aggregate in the US have a net cap position. And so that ultimately helps their wealth. They're able to put that money into more investment and and be more profitable. So while it certainly changes the risk profile for equities, ultimately it's a big economic boost and that gives us going forward really a nice tailwind going into this next year. And so that's rate boost is the word of the day. OK, So rate boost is your word of the day. At the same time, we're talking a lot about the consumer. In fact, the consumer discretionary sector last month, it actually traded lower, fractionally lower, but still lower. And it's actually part of the reason I think the weakness to the consumer why you want to sell your, you're saying your, your picks for us today are actually sells. I should say Lowe's is one of them tied to the housing market and consumer discretionary spending, right. So on the flip side of that interest rate hike and benefiting a lot of the savers, of course, we have inflation and that does hurt a good portion of of the US economy specifically those renters are most impacted. But obviously, anybody that's feeling that, that in fact of inflation and we're seeing less of an appetite for consumer durables and home builders have had such a good run up since 2022. And I think they're looking really pricey, particularly as we see consumers reevaluate where they're going to have their spend. And so Lowe's, Masco and Beacon, Beacon Roof Supply, those home builder materials look particularly vulnerable. So I would say if you have holdings in these stocks, these are the stocks that you want to take profits if you haven't already done so. All right, so that's where you want to take profits. I also want to look ahead today. We do have some economic reports, certainly not as big as the jobs report on Friday, but we have some reads on the global supply chain, ISM and PMI. When you're looking at that, at these economic reports, they influence any other decisions that you may want to make. I think it's more about when you look at any economic reports these days, it's really trying to guess what the Fed's going to do and therefore what's going to happen to rates and then exactly and then that whole trickle down effect. So of course, absolutely we're looking at them. Am I going to be trading off it? Not unless it's something really dramatic and really unexpected where it would almost force the Fed into a different stance or we would see, you know, an an immediate expectation of a rate cut going down. But as long as it's sort of these middle of the road type of reports, I I wouldn't say we're going to see any big changes going forward. Right now today we're talking a lot about NVIDIA after that surprise announcement yesterday. How do you feel about tech right now? There are some concerns about over concentration. Certainly I didn't, you know, look, I think the AI story really is something that has quite a long lengths to go. It's really about how it's going to be implemented and how it goes down to different industries. And obviously Nvidia's is the leader of the pack. I think with regards to technology, you really should be looking very carefully at how they've been managing the integration of AI and really getting down to the fundamentals. And right now it's still now the infrastructure side that is doing very clearly well, whether it's the the semiconductors making of materials or energy.