Happy Friday eve, readers. The stock market is stumbling into the end of the month, Fed signals are spooking investors, and global economic uncertainty is rampant.
Let's see what Cathie Wood and Michael Burry have to say about it.
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1. Two market icons have a warning for the economy. As the stock market closes out a brutal month and bonds crater, investors have grown increasingly wary that hawkish Fed policy is setting the economy up for a recession.
The slide in the stock market, according to Ark Invest's Cathie Wood, suggests that the Fed could end up sinking the economy.
"Equities and bonds seem to be warning the Fed that its policy measures could cause an economic and/or financial crisis: equities are swooning and the yield curve is nearly [in] negative territory," Wood tweeted Tuesday.
Her comments followed Deutsche Bank's prediction that a major US recession could be looming before the end of 2023.
Meanwhile, "Big Short" investor Michael Burry has his sights set on household finances.
Vast amounts of cheap money during the pandemic boosted consumers' wealth, Burry said, and that is at risk of faltering in the face of historic inflation and falling asset prices.
"This is the problem," Burry said in a now-deleted tweet Tuesday. "Last 18 months - $850B in direct stim checks, $400B in cash out refis, $1+T in forgivable loans ($250-500B of it fraudulent), another $4 trillion indirect, etc."
"What recapitalizes the consumer now?" Burry added "Higher wages can't do THAT."
In other news:
2. Nasdaq futures have got a lift from a rally in Meta. Shares in Facebook's parent company are up sharply in the premarket, bringing some much-needed cheer to the beaten-down tech sector. Here's the latest.
3. Earnings on deck: American Airlines, Alaska Air, and AT&T, all reporting.
4. These are the three best ways to gain exposure to the real-estate sector and prepare for inflation, according to a fund that has risen in 34 of 37 quarters. Since 2012, this top Bluerock fund has brought in positive returns — and one of its top strategist shared the best subsectors in real estate to invest in right now.
5. The euro hit a five-year low against the dollar. Russia's halt in gas flows have darkened the economic prospects for Europe. The IMF warned that the ongoing war in Ukraine will have "severe economic consequences for Europe."
6. After Elon Musk's purchase of Twitter, it's not quite a done deal just yet. Notably, he may have to put up more collateral if Tesla stock falters. Here's how much the EV-maker's stock has to fall before Musk has to pony up more of his own money to buy Twitter.
7. Russia is facing its biggest slump in oil production since the final days of the Soviet Union. Russia estimated its oil output could fall as much as 17% this year, signaling the worst crash since the 1990s, according to a new report. Get the details here.
8. BlackRock's chief global investment strategist shared the best investment opportunities she sees right now. Wei Li said investors should be paying attention to the peak federal funds rate instead of the pace of rate hikes. And, despite her optimism for the economy, she explained why the risk of a policy mistake by the Fed has grown.
9. Dogecoin trading surged after Elon Musk's takeover of Twitter. Five crypto veterans discussed the future of the meme coin — and why it's potential real-world uses may translate into future gains.
10. Robinhood stock dropped after the company announced it's cutting 9% of staff. After a period of rapid growth during the pandemic, the cuts should "improve efficiency, increase our velocity," said CEO Vlad Tenev. The company reports earnings after the close on Thursday. Here's what you want to know.
Keep up with the latest
Curated by Phil Rosen in New York. (Feedback or tips? Email prosen@insider.com or tweet @philrosenn.)