The Dividend Cafe - The Dividend Cafe Tuesday - October 1, 2024

Episode Date: October 1, 2024

Economic Update and Market Insights: October 1st Summary In this episode of Dividend Cafe, host Brian Szytel provides a market update from New York City on October 1st. He discusses the day's negative market performance influenced by Middle East tension between Iran and Israel, which led to increased oil prices and slight declines in stocks. Key economic data points include unchanged ISA manufacturing data for August and a rise in job openings as per the JOLTS report, indicating a balanced labor market. Szytel also addresses a viewer question on evaluating stock prices and dividends, emphasizing the importance of fundamental analysis over high yields. Overall, the episode delivers a blend of market analysis and economic news with a cautionary note on ongoing geopolitical tensions. 00:00 Welcome to Dividend Cafe 00:10 Market Overview and Middle East Tensions 00:42 Economic Calendar Updates 00:57 Labor Market Insights 01:57 Geopolitical Tensions and Market Impact 02:04 Ask TBG: Stock Analysis 02:41 Closing Remarks Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe, weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome to Dividend Cafe. This is Tuesday, October the 1st, in the first day of the fourth quarter. And this is Brian Seitel here from New York City. What was generally a negative day in markets, although we were off the worst levels. And the reason for some of the volatility on the day was some Middle East tension between Iran and Israel. There were missiles launched similar to what happened in April of this year from Iran to Israel and somewhat of a retaliation for some escalation in Lebanon. Middle East tensions there, oil was up on the day, stocks were down marginally off of the worst levels. The S&P was down a little

less than a percent, about 93 basis points. A couple of pieces of news in the economic calendar, we had ISM manufacturing data that came out unchanged for the month of August. We got a 47.2. data that came out unchanged for the month of August. We got a 47.2. It was below about a 47.5, which is what was expected. And anything below 50 is contractionary. And so manufacturing numbers continue to be a little bit on the weaker side. We also had a new jobs openings number today, a jolt number that was actually up and better than expected at 4.3% on the month. We got over an 8 million new job number print in there. And the labor market remains very balanced, frankly, at this point. And so when you have new job openings start to creep up, this is actually counter to what some of the more aggressive Fed rate expectations are on the cutting side. So we'll keep that in mind.

The amount of new hiring and quits, though, was basically both down a little bit. And so you get a balancing act with some of this, meaning that the unemployment rate probably didn't change much. You're just seeing that there's an increase in new job openings. And that can be a sign of, you know, pick up an economic activity, more employers are hiring. And that's technically a very good thing, but potentially counter to what the Fed is after with what they're looking at in the labor market. Other than that, I would say it's a quiet day, although geopolitical tension never really is. And so take that for what it's worth. There was an AskEBG question in there about a particular

stock, a particular name, and how we look at things based on the stock price depreciation and the high yield that it has. And my comment in there was more to do with fundamentals, things like dividend coverage ratio, things like the financials of the business, and then it has to do with stock price performance and the way that we look at some of these things. And again, really the growth of that dividend over time is what we're paying more attention to. And some of those names can be falling knives. They can be positions that you wouldn't want to take on because the dividend isn't sustainable. And that is technically potentially one of them was the answer.

So with that, I'm going to let you go here for this evening. It's late here in New York. I hope you all are having a great evening. Reach out with your questions as always, and we shall talk to you soon. Thank you. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, questions as always, and we shall talk to you soon. Thank you. This is not an offer to buy or sell securities. No investment process is free of risk. There is no guarantee that the investment process or investment opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment opportunities referenced herein may not be suitable for all investors.

All data and information referenced herein are from sources believed to be reliable. Thank you. or for statements or errors contained in or omissions from the obtained data and information referenced herein. The data and information are provided as of the date referenced. Such data and information are subject to change without notice. This document was created for informational purposes only. The opinions expressed are solely those of the Bonson Group and do not represent those of Hightower Advisors LLC or any of its affiliates. Hightower Advisors do not provide tax or legal advice. This material was not intended or written to be used or presented to any entity as tax advice or tax information. Thank you.