In early July, the broad market failed to make new lows even despite bad news. The CPI print came in at a 40-year high, followed by the producer price index surprising to the upside. This told the market that inflation was still an issue and would likely be into the near future. This was then followed by mixed banks earnings, as reports of a looming economic slowdown and run-away inflation was starting to show up in earnings.

The ad-tech sector's performance is closely linked with the macroeconomy. This sector has been hit hard in the last few months due to global uncertainty. We believe this sector will recover when the economy starts picking up. It is practically impossible to time the market. However, we believe that being prudent and buying stocks during the downturn helps to outperform the market in the long term.

High-Frequency data continues to point toward a slowdown with inflation. The ECB is tone is getting more aggressive, while the FED’s tone is getting less aggressive. This would suggest that a new bull cycle is building as we speak.

Semiconductor stocks have gained prominence due to growth drivers such as artificial intelligence, high-performance computing, 5G, robotics, machine learning, and electric vehicles. Despite semiconductor companies underperforming YTD, there is evidence that more supply will come online by the end of the year that will be met with equal or greater demand.

Most investors agree that cloud is a critical trend to have in a portfolio as the category’s growth has been resilient due to increasing productivity while reducing costs. This is especially true for software-as-a-service whereas cloud infrastructure as-a-service does not always result in lower costs compared to on-premise servers.

In this week’s Broad Market Analysis, Knox discusses why there’s still some uncertainty about whether this is the bottom or not. Watch the broad market update pulled from the Premium Webinar where the I/O Fund covers six other portfolio stocks.

In this last week’s Broad Market Analysis, Knox reviews the evidence building the current uptrend that could extend into Fall 2022. Watch the preview clips taken from I/O Fund’s 1-hour Premium Technical Analysis Webinar below with written commentary from Knox himself.

Big Tech earnings were off to a solid start last week when Microsoft and Google reported stable revenue growth and margins that are unchanged from recent macro conditions. The strong margins were especially welcomed as many companies have been missing on operating margins and cash flow.