Strong Manufacturing Data Changes Sentiment
America’s democratic institutions are strong. Trump’s power is receding. In its battle with Trump, Harvard University is beginning to gain ground. See New York Times and Silver Bulletin by Nate Silver.
Friday’s January jobs report will be delayed because of the partial government shutdown.
U.S. manufacturing surges in January. New orders and production figures were very strong. The Institute for Supply Management’s manufacturing index rose to 52.6 from 47.9, according to data released Monday. The numbers were the strongest in three years.
The Trump Administration is characterized by high uncertainty and chaos. Investors will continue to hedge against Trump with exposure to metals and European equities.
The United States and India reach a trade deal. This is good news. India is a rising power. India and China are adversaries. Equities in India are very attractive and the market in the country should go gang busters today.
https://www.cnbc.com/2026/02/02/trump-india-trade-deal-tariffs.html
Markets and Stocks
Equities surge on strong manufacturing data and growing confidence that Warsh will be an inflation hawk.
Warsh is an excellent choice as the next Fed Chair. He is an inflation hawk.
Gold, Silver and Copper
Metals, both precious and industrial, remain very attractive. I am sticking with CDE. Given the current prices of gold and silver, CDE is deeply undervalued. CDE reports on February 18. Coeur’s acquisition of New Gold should close before the end of June.
Retail investors continue to buy silver aggressively. Silver rose on Monday.
https://www.cnbc.com/2026/02/02/retail-traders-arent-giving-up-on-slv-after-silvers-plunge.html
Pepsi releases Q4 results before the opening today. The numbers are expected to be good. Over the past few weeks, PEP has started to move higher. I like PEP.
https://www.barrons.com/articles/pepsico-earnings-stock-price-866648b1
Robin Hood
The stock is sinking like a stone because of the sharp fall in prices for crypto assets. I own the stock, I will not sell. I believe that HOOD will be a big winner over the next several years.
OpenAI
The company is in the process of raising another $100 billion in capital. This should be the last funding round before the company comes public in Q4.
Oracle
Oracle is raising $50 billion to fund its aggressive data center strategy. I still believe in the stock. I think Oracle will double within two years. The debt market loved the announcement. With the equity raise, the risk of default dropped sharply. Credit default swaps on CDE fell by 17% yesterday.
https://www.cnbc.com/2026/02/02/oracle-stock-price-funding-plans.html
Micron
The market for memory chips continues to tighten. Memory chip sellers are quoting premiums of 125% above list.
Elon Musk
Space X combined with xAI. Space X will come public before the end of the year. The value of the combined company is around $1.25 trillion. The public offering is expected to raise $500 billion. Cash from the IPO will be available for the expansion of xAI.
https://www.cnbc.com/2026/02/02/elon-musk-spacex-xai-ipo.html
Palantir
PLTR released excellent results. The stock was up sharply after the close. The numbers and the street reaction are good for overall sentiment.
Disney
The company reported strong results for its December quarter. But the stock sold off on concerns about costs for the streaming business.
Flagstar
Flagstar reported better than expected numbers. It is taking longer than I expected but the pace of the turnaround is accelerating. I will continue to hold the stock.
https://stocks.apple.com/AyY_r94ACReWc-L-hIA7FoA
Axon
Abacus Research is recommending Axon. Abacus says Axon is a unique beneficiary of AI. Research report available on request.