Yo Pit Crazies,
In Maine, we have a season within fall.
It’s the color season where the leaves change color as we approach Columbus Day, the high season when all the color is in full swing.
Right now, the maples are doing their thing.
Since some students liked the summer aerial video of the G homestead, I thought I’d post some current fall foliage…
What's not falling is Micron Technology (MU). I sold the last of my MU shares around $900 this year after watching the stock climb $800 in one year. Boy, was I wrong.
Micron reported Wednesday after the bell, and the numbers are nuts. Revenue hit $54.2 billion for the quarter, almost five times what it did a year ago. Profit came in at $37.7 billion, up from $3.2 billion, so we're talking a better than 10x jump as the AI revolution gets humming.
And Micron says next quarter should be even bigger, with revenue guidance around $61.5 billion.
On Tuesday, the Trump administration brought the top AI CEOs to the White House for a little detente and dialogue. The White House even invited CEOs who've been critical of the President. They didn't get to sit next to him, of course, but they still got a seat.
Zuckerberg, Nvidia's Jensen Huang, Musk and Google's Sundar Pichai sat right with Trump. Anthropic's Tom Brown wound up at the end of the table after months of fighting with the White House.
A sharp follower on X pointed out that the alpha (the returns that beat the market) will likely come from the names seated near and across from POTUS. I agree. Micron's CEO made the guest list too.
With the AI summit, the new America.gov site (an AI chatbot that answers questions about government services) and Micron's blockbuster quarter, you'd think stocks would shine this week.
They haven't.
See below:
The Story That Isn't Getting Headlines
The oil picture's going to right itself. Gulf crude exports are back to prewar levels, and Iran's exporting zero.
Tanker trackers say at least 16.5 million barrels a day left the Gulf this month, right in line with prewar levels once you take Iran out. Satellite data Goldman Sachs reviewed shows zero Iranian crude leaving by sea in September. Before the war, Iran shipped about 1.7 million barrels a day.
That's the Persian Gulf getting reordered in real time. It took seven months, and the Trump White House is moving on to AI without touting the Gulf win heading into the election. Even the New York Times ran a piece on the new reality facing Iran's leadership: Deal or Die.
So far none of it has translated into better market sentiment or a lower VIX (the index that tracks how much fear traders are pricing in). Brent crude has dropped from $106.60 last Thursday to around $97, and stocks still haven't cared.
Traders are focused on interest rates, and for the most part POTUS has given up on pushing them lower. The 10-year Treasury yield sits around 5.24 percent, close to levels we haven't seen since 2007. Fixing that is really Congress's job.
In the meantime, things are moving in the right direction. That gives you plenty of time to pick up some stocks at good prices.
I expect a lot of stocks that took hits from higher oil to recover. That's why I look for Option Fingerprints (my name for the big, unusual trades that show up in long-term options). Investors and politicians play in long-term calls (bets on a stock rising that don't expire for months or even years), and I like to know when they do.
Other beaten-down names are on my radar too. Zoetis (ZTS), the animal health company, has been on my scanner for a while but hasn't popped a signal yet, and that's saved me $30 on the stock.
So far my Sibyl scanner has caught 14 of 15 closed winners, and I expect it to pick up a bunch more once things bounce a bit.
Hopefully this was helpful,
Andrew Giovinazzi