Wally’s Wall Street WakeUp

Fresh news and strategies for traders. SPY Trader episode #1169. Alright folks, it's your pal Wally Pip here, your friendly neighborhood financial guru, ready to break down the market! It's 6 am on Friday, May 16th, 2025, Pacific Time, and the coffee is brewing, so let's dive into what's shaking up Wall Street today. First up, the big picture: the US stock market's been on a generally upward trend lately, with the S&P 500 riding a fourday winning streak. Optimism around USChina trade talks and some easing inflation are keeping spirits high. In fact, the US500 is up 0.88% since the start of the year. Remember that alltime high of 6152.87 back in February? Good times! Now, let's talk sectors. Yesterday, utilities, consumer staples, and real estate were the MVPs. Tech, on the other hand, took a bit of a breather as some folks decided to cash in on profits. Keep an eye on those cyclical sectors like tech – they've been outperforming defensive plays like healthcare recently. In news, we've got a mixed bag. The US and the UK shook hands on a trade deal, and the US and China are talking again, so hopefully, that means fewer tariff headaches. The Fed decided to hold steady on interest rates, keeping them between 4.25% and 4.5%. And check this out – wholesale prices actually fell last month by 0.5%! That's a nice surprise. On the company front, UnitedHealth Group, or UNH, took a serious hit, plunging 11% because of a federal investigation. Ouch! Walmart, or WMT, dipped a little too, warning they might have to raise prices thanks to those pesky tariffs. But hey, they also reported betterthanexpected profits, so not all bad. GE, or General Electric, got a nice boost, climbing 2.8% after Qatar said they'd only use GE engines in Boeing's widebody planes. And in retail news, Foot Locker is getting hitched to Dick's Sporting Goods. Congrats to the happy couple! Now, for the notsosunny side. The US economy is expected to slow down this year, with growth around 1.3%, and there's even talk of a possible recession. GDP shrank a tiny bit in the first quarter, contracting by 0.1%. Some folks are worried that all these policy changes could lead to inflation, maybe even hitting 4% next year. The Fed's keeping a close eye on both unemployment and inflation risks. So, what's the Wally Pip take on all this? Well, first off, keep an eye on Apple and Nvidia this month. Nvidia's sales to China and how a slowdown might affect AI investments are big question marks. As for what to do with your hardearned cash, I'd say stick to a marketweight position for now. Consider tilting towards value and core stocks. And think about diversifying with some international stocks. Remember, we might see some bumps in the road, so be ready for some volatility. And as always, keep your eyes peeled on those trade negotiations and tariff situations. That's all for today, folks! Stay informed, stay invested, and remember, even a blind squirrel finds a nut sometimes. This is Wally Pip, signing off!