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Barrons 3/5/203 Redux: (i) Macro Data Indicate Further, Faster Interest Rate Hikes; (ii) BioTech – Does Year of Approval, with patent Cliff Bode Well?; (iii) Stock Comp Dilution a Drag of Software; (iv) PM Barnaby Wilson of Lazard Asset Management Likes Quality of ASML, Unilever and RELX o

Up & Down Wall Street & Preview Highlights that Hot Macro Data May Force Fed to Raise Interest Rates Faster & Higher

Up & Down Wall Street focused on the fact that big tech appears to make profits a focus instead of growth.  Data shows that this is because there may be little growth – in aggregate APPL, MSFT, GOOGLE has 1% aggregate sales growth.  Anecdotally, computer sales are slowing dramatically; I get assailed by PC discounts daily.  Dell, HP, PSTG, WDAY and SNOW earnings call comments consistently note slowing bookings, and customer resistance to purchase.

Question, with the profits from cost cutting, will companies accelerate stock buybacks, especially if there is the possibility that the recently enacted 1% buyback tax may rise to 4%?

Preview followed the theme, but wondered if a deeper analysis of the strong January 2023 macro data may reveal the numbers weren’t that strong?  Appollo Global Management’ Chief Economist, Troten Strok  states the obvious; despite aggregate quantity of sales of homes down 18% in 2022, foo-traffic and interest in purchasing appears to make the housing market look like it may be rebounding.  Prices are certainly bolstered by historically low inventor.  If home prices do not cool, and the labor market does not cookl, Troten says that the Fed. will raise rates faster & further.

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