The futures were mixed at the midway point of the trading week, after all the major indexes closed higher on Tuesday. While most of the chatter from the Wall Street financial media and strategists Tuesday focused on stocks was mostly positive, the stock market remains very overbought. The reality is that about seven stocks have accounted for 95% of the gains in the S&P 500. Citigroup noted during the day that we could be on the verge of a big tech sell-off, as investors trading Nasdaq futures are sitting on huge gains. If they start selling, the market could be in for a rough ride.
Treasury yields were flat to modestly higher as many traders are holding their fire and waiting for the Federal Reserve meeting on June 13, which is the same day that the May consumer price index (CPI) numbers will hit. It is a reasonably good bet that if the reading comes in higher than anticipated, the Fed will be forced to raise rates again. The May inflation is forecast to rise 0.2%, down from the 0.4% increase seen in April. May’s core CPI, with volatile food and energy prices excluded, is expected to increase 5.3% annually and 0.5% on a monthly basis.
Brent and West Texas Intermediate crude were both down on Tuesday but rallied off the lows of the day as the boost from the Saudi production cuts is wearing off. In addition, Citigroup commented on Tuesday that oil is unlikely to reach the high $80s despite the cuts. The modest selling came despite another double-digit drop in the rig count last week. The data indicates a decline of 52 rigs over the past month, the biggest drop since June of 2020. Natural gas finished the day higher at $2.26.
Gold finished Tuesday higher, and analysts noted that Russia has been selling gold and the Chinese yuan from its National Wealth Fund to finance the country’s budget deficit, which is likely being stretched by the ongoing conflict with Ukraine. Bitcoin, after being battered over the past month, rallied Tuesday by over 5% in a big reversal and closed at $27,080.
24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top analyst upgrades, downgrades and initiations seen on Wednesday, June 7, 2023.
Advanced Micro Devices Inc. (NASDAQ: AMD): Piper Sandler reiterated an Overweight rating on the stock, and its $110 target price popped to $150. The consensus target is $103.86. The stock closed over 5% higher on Tuesday at $124.23 after the upgrade.
AMC Networks Inc. (NASDAQ: AMCX): Morgan Stanley’s downgrade was to Underweight from Equal Weight, and it cut its $19 target price to $12. The consensus target is $18.86. The stock closed on Tuesday at $11.53.
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