June 23, 2020

STOCKS – MA, NKE, SBUX, MU

MACRO – SPY

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• Webinar Replay Link For 6.18.20

S&P 500 (SPY)

Michael Kramer and the clients of Mott Capital own V, MA

It was a strange overnight session, with futures plunging after trade advisor Peter Navarro made some comments around the China trade agreement. But upon witnessing the futures collapse by nearly 2%, the comments were walked back and clarified. Luckily it happened at 9 PM, and individual investors weren’t hurt because had it happened during the day, the damage would have been worse.

We will have to keep this in mind. I’m not sure if it was a trial balloon or Navarro merely express his true feelings, but keep this tucked away somewhere. It probably won’t be the last time we hear this in 2020.

S&P 500 (SPY)

Anyway, futures recovered and are up now. The good news is that the S&P 500 is rising and pushing towards its next significant resistance level at 3,150. It is a massive level for the index, and if it can get above that level, it will be a big positive. It can’t; then this could get tricky. The chart below shows why, with the index having already failed four times at 3150. 

I honestly do not know what will happen, but it is a critical point for the S&P 500. To be honest, the fact that we failed already four times, I’m not sure I like the odds.

Mastercard (MA)

Mastercard was downgraded today to perform from outperform at Oppenheimer today. The stock hasn’t performed nearly as well as stocks like PayPal (PYPL) or Square (SQ), which seems mind-blogging to me, considering there would be no PayPal or Square if there were no Mastercard or Visa (V). So either PayPal and Square are way ahead of themselves, or Mastercard has a lot of room for improvement. The $314 level has been a severe level of resistance for the stock. A decline below $293 sets up a more significant push lower to $272. 

Micron (MU)

Micron was downgraded today by BMO to market perform from outperform, with a price target of $55 from $60. The stock needs to stay above $49.80 to maintain its bullish momentum, while a break of that level sets up a decline to $45.50. 

Nike (NKE)

Nike had its price target raised to $117 from $108 at BTIG. The company reports results later this week. It will be a big earnings report for Nike since it will be there first full quarter in the global pandemic. $106 is resistance for now. 

Starbucks (SBUX)

Telsey lowered Starbucks ‘ price target to $80 from $90. The stock has struggled of late but has held up better than I have expected, given that the company lowered its guidance. I would begin to worry if it fell below $72, that would be a big trigger point. 

Have a great day

-Mike

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