TSLA - Better Performer Than Nvidia – Copper Stock Freeport On China Optimism Front Running Blind Money Fizzles | Benzinga
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Please click here for an enlarged version of the chart of Freeport-McMoRan Inc (NYSE: FCX) compared to NVIDIA Corp (NASDAQ: NVDA).
Note the following:
- This article is about the big picture, not individual stocks. The charts of Freeport-McMoRan (FCX) stock and Nvidia (NVDA) stock are being used to illustrate the point.
- FCX is a major copper producer.
- The chart shows FCX price action in the top pane and NVDA price action in the bottom pane. As a full disclosure, both FCX and NVDA are in The Arora Report ZYX Buy Model Portfolio.
- The chart shows that FCX has performed almost 100% better than NVDA for the period shown. This comes as a surprise to most investors. This illustrates the need to properly construct a model portfolio diversified by strategies. The Arora Report uses over 50 different strategies. Constructing a great portfolio is highly complex.
- The reason FCX, along with other copper stocks, has done so well is optimism about China’s economy. China is a major copper user.
- Purchasing Managers’ Index is a leading indicator. The official data just released from China is positive. A PMI over 50 is considered economic expansion. China’s Manufacturing PMI moved to expansion for the first time since September of last year.
- Manufacturing PMI in China came at 50.8 vs. 50.1 consensus.
- Non-Manufacturing PMI came at 53.0 vs. 51.3 consensus.
- On Friday when the U.S. market was closed, core PCE came at 0.3% vs. 0.3% consensus. PCE is the Fed’s favorite inflation gauge.
- Fed Chair Powell said that the PCE data was inline with his expectations. Powell said that lower interest rates would not be right until the Fed is sure about inflation.
- When futures opened on Sunday evening, the momo crowd aggressively bought stock futures and continued to buy them until earlier this morning. The reason is that Wall Street ...