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U.S. Joint Chiefs chairman Gen. Mark Milley on Friday said the United States military ‘needs to accelerate our modernization’ in an effort to compete with China as warfare technology continues to evolve and criticized Russia over its conflict with neighboring Ukraine. 

During his remarks at the National Press Club luncheon in Washington D.C., Milley accused Moscow of committing a ‘direct frontal assault’ on the rules-based international order with its ‘illegal invasion’ of Ukraine.

‘Our political leaders have said multiple times that our task is to ensure that Ukraine has the support it needs to remain free and independent and we’re doing that in order to make sure that rules-based international order holds,’ he said. 

He also said that China was looking to ‘rewrite’ those rules as it leverages its financial power to build up its military. The U.S. should counter Beijing’s military ambitions by focusing on what type of conflicts it will face in the future.  

‘I think the United States military needs to accelerate our modernization,’ he said. ‘And it’s not so much just the actual modernization, but it’s the acceptance of the idea that future war, the fundamental character of war, is actually changing in really significant radical ways. If we, the military, don’t adapt ourselves, our doctrine or tactics or techniques, our leader development, our training and talent management, but also the weapon systems. If we don’t do that, then we won’t have a military that’s capable of operating in that future operating environment.’

‘They want to exceed global U.S. military power by mid-century,’ he noted of China’s military goals. 

Milley has made the modernization of the military a primary effort of the Army, going back to his days as the branch’s chief of staff. 

While discussing Ukraine, he noted that an offensive against Russian forces has made slow but significant advances. The Biden administration has provided billions of dollars in military aid to Ukraine, which has surprisingly taken the fight to Moscow, frustrating Russian President Vladimir Putin and the Kremlin. 

When asked about the potential supply of cluster munitions to Ukraine, Milley noted that the U.S. considers ‘all kinds of options.’

‘So that it’s going slower than people had predicted doesn’t surprise me at all,’ he said of Ukraine’s ongoing military offensive. ‘I had said that this offensive, which is going, by the way, it is advancing steadily, deliberately working its way through very difficult minefields, etc., you know, 500 meters a day, 1,000 meters a day, 2000 each day, that kind of thing. What I had said was this is going to take six, eight, 10 weeks. It’s going to be very difficult. It’s going to be very long and it’s going to be very, very bloody. And no one should have any illusions about any of that.’

‘Ukraine is fighting for its life,’ he added. ‘It’s an existential fight for Ukraine.’

When asked about the short-lived rebellion by Wagner Group leader Yevgeny Prigozhinn against Russian President Vladimir Putin earlier this month. Milley said the move is part of internal politics and said ti was too early to tell if Putin was weakened. 

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House Speaker Kevin McCarthy, R-Calif., and former House Speaker Nancy Pelosi, D-Calif., don’t get along.

But if House Republicans try to impeach President Biden or a roster of other Biden cabinet officials in the coming months, a look at how Pelosi handled impeachment questions deserves attention.

Rewind the calendar to 2007. Democrats flipped control of the House in the 2006 midterms. Pelosi faced a wall of pressure from liberal Democrats to impeach President George W. Bush over the war in Iraq.

Pelosi resisted those calls. ‘Impeachment is off the table,’ Pelosi said at the time.

But Pelosi had a plan to wind down the U.S. commitment overseas. Pelosi instructed then-Appropriations Committee Chairman David Obey, D-Wisc., to start diminishing spending available for the war effort. Control of the purse strings is the ultimate power in Congress. Pelosi and Obey didn’t want to cut off troops in the field. But the plan was to dial back funding so the U.S. would leave Iraq sooner rather than later. 

Fast forward to the summer of 2019.

Pelosi had resisted calls to impeach former President Donald Trump for years over a host of transgressions. Pelosi often reminded House Democrats and her members she supported an investigation of alleged misdeeds and would ‘follow the facts’ wherever they may lead.

Democrats were disappointed in information provided at a summer 2019 hearing with former Special Counsel Robert Mueller. Mueller was coy during his testimony and failed to produce a smoking gun. But some lawmakers observed that Mueller may have left a breadcrumb of clues in his report investigating Trump: impeachment may be an option.

Still, Democrats were reluctant to go there — even though many wanted to do so.

In fact, Rep. Al Green, D-Texas, regularly launched efforts to try to impeach former President Trump. While many Democrats admired Green’s gusto, they viewed his effort as an unserious sideshow.

Pelosi wouldn’t let the House be a part of such a carnival.

That was until word came of the phone call between President Trump and Ukrainian President Volodymyr Zelenskyy. Information surfaced that Mr. Trump may have delayed sending previously-approved assistance to Ukraine. But he first pressured Zelenskyy to launch investigations of President Biden and his son Hunter Biden.

No love was lost between the former president and Pelosi. But Pelosi was often a master of understanding where the votes might be on a given issue. She was also mindful of protecting her members from taking a tough vote. Pelosi didn’t appear ready for impeachment yet. Certainly after Mueller’s appearance. But the Trump/Zelenskyy phone call was another matter.

In mid-September 2019, a coalition of seven Democratic freshmen House members penned an op-ed in The Washington Post. They wrote that if the allegations against Trump were true, they would consider it ‘an impeachable offense.’

All seven authors flipped districts from Republican to Democratic control in the 2018 midterms. The seven had serious national security credentials. Rep. Jason Crow, D-Colo., served in the Army. Reps. Abigail Spanberger, D-Va., and Elissa Slotkin, D-Mich., worked for the CIA. Three served in the Navy: Rep. Mikie Sherrill, D-N.J., along with former Reps. Elaine Luria, D-Va., and Gil Cisneros, D-Calif. Rep. Chrissy Houlahan, D-Pa., was in the Air Force.

The op-ed signaled to Pelosi that centrist, Democratic freshmen from battleground districts were willing to potentially impeach the president. The speaker had protected them and others from what could become a career-defining vote. Pelosi greenlighted a formal impeachment inquiry a few days after the op-ed. The House voted on Halloween to design the ground rules for an impeachment inquiry. And just before Christmas, the House voted to impeach Trump again.

The Pelosi-led House moved to impeach Trump just hours after the Capitol riot in January, 2021.

The measure went to the floor swiftly — lacking the weeks and months of hearings which were a feature of the former president’s first impeachment. In fact, the House impeached Trump days before his term expired.

Pelosi didn’t hold back on impeaching Trump that time because she had the votes. She also wanted to impeach him while he was still in office.

What is past is prologue.

McCarthy may have temporarily circumvented an immediate push by Rep. Lauren Boebert, R-Colo., to impeach President Biden before the House abandoned Washington for the July Fourth recess. But this is far from the last time we will see or hear about this debate.

And the stark reality is that it may very well wind up in an eventual impeachment of President Biden.

Here are several scenarios which could unfold over the next few months:

The Judiciary and Homeland Security committees are already probing alleged misdeeds of Biden. Boebert’s resolution specifically calls for impeachment of the president because of how he’s dealt with the border. The House voted to send Boebert’s resolution to those panels, preventing an immediate up/down vote on impeachment on the floor. 

Watch to see how these committees move. If they amp things up, the House could be headed toward a true impeachment inquiry. That ultimately could result in an impeachment vote later this year. However, it is unclear if the House actually has the votes to impeach Biden.

By contrast, the Judiciary and Homeland Security committees could do nothing with the referral of Boebert’s impeachment resolution. Boebert indicated she’d force the issue on the floor again. This is a little like Al Green’s repeated efforts to impeach Trump. But if Boebert presses the issue, McCarthy could lack the ammo to again sidestep a direct confrontation over impeachment. 

That likely means Boebert reintroduces her special resolution to impeach Biden. Either the House votes on that or tables it. A straight vote on impeachment causes big problems among Republicans. Some conservatives truly want to impeach the president. Others like to talk about impeachment but don’t really want to tangle with it. Still, other GOPers see impeachment as political kryptonite and want to stay as far away from it as possible. Forcing a vote actually on an issue as explosive as impeachment ignites a GOP firestorm. Of course, voting to table it triggers a political maelstrom among a different set of GOP factions.

Here’s another possibility: The committees actually shelve the impeachment effort. The committees might address the impeachment question and conduct investigations. But some Republicans already view the move to send the Boebert plan to committee as an effort to euthanize the enterprise. Some Republicans will breathe a sigh of relief. Others will go nuclear — perhaps against the speaker.

The bottom line: While not yet a formal ‘impeachment inquiry,’ the committees have wide latitude to truly investigate allegations which could be potentially worthy of impeachment. The vote to send the Boebert impeachment resolution to committee may have been a fig leaf. But chances are that the House must address impeachment for President of the United States in some form later this year.

As we speak, there are various Republicans who hope to impeach Attorney General Merrick Garland, FBI Director Christopher Wray, Homeland Security Secretary Alejandro Mayorkas and Washington, D.C., U.S. Attorney Matthew Graves.

In an interview with Fox about impeaching Garland, Rep. Marjorie Taylor Greene, R-Ga., noted that ‘Kevin McCarthy is not against impeachment at all.’ Greene observed that ‘if we’re going to do it, it needs to be successful.’

In other words, just don’t deposit a privileged impeachment resolution on the floor and expect members to vote on it, al a Boebert or Al Green.

‘The speaker of the House, whether it’s Nancy Pelosi, Kevin McCarthy or anyone … they want to make sure that they have the votes to pass it,’ said Greene.

That’s a calculus McCarthy may need to figure in the coming months — be it for Biden or the host of other figures listed above.

Pelosi moved the impeachments for Trump once she was confident she had the votes. But McCarthy only has a four-seat majority. It’s far from clear how he’ll handle similar impeachment calls on his watch.

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Supreme Court Chief Justice John Roberts cited former House Speaker Nancy Pelosi, D-Calif., in his majority opinion to help explain why President Biden’s student loan handout was unconstitutional.

On Friday, Roberts released the Supreme Court’s opinion blocking Biden’s student loan forgiveness plan, one of the president’s major campaign promises.

In the opinion, Roberts cited then-Speaker Pelosi’s words saying the president did not have the power to cancel federal student loan debt.

‘As then-Speaker of the House Nancy Pelosi explained: ‘People think that the President of the United States has the power for debt forgiveness. He does not,’’ Roberts quoted Pelosi’s July 28, 2021, press conference. ‘‘He can postpone. He can delay. But he does not have that power. That has to be an act of Congress.’’

‘Aside from reiterating its interpretation of the statute, the dissent offers little to rebut our conclusion that ‘indicators from our previous major questions cases are present’ here,’ Roberts wrote, citing Justice Amy Coney Barrett’s concurring opinion.

Robert’s opinion comes as the Supreme Court hands down several high-profile cases going into the summer months.

Associate Justice Neil Gorsuch issued a harsh rebuke of Associate Justice Sonia Sotomayor’s dissent in the case of a Christian web designer who the court ruled was not obligated to design websites for gay couples.

‘It is difficult to read the dissent and conclude we are looking at the same case,’ Gorsuch wrote in the 6-3 Supreme Court decision on Friday. That decision said web designer Lorie Smith was not legally required to design websites for gay marriages because doing so would violate her free speech rights and Christian beliefs, despite a Colorado law that bans discrimination based on sexual orientation.

Gorsuch said Sotomayor’s dissent in the case ‘reimagines the facts’ from ‘top to bottom’ and fails to answer the fundamental question: ‘Can a State force someone who provides her own expressive services to abandon her conscience and speak its preferred message instead?’

‘In some places, the dissent gets so turned around about the facts that it opens fire on its own position,’ Gorsuch wrote. ‘For instance: While stressing that a Colorado company cannot refuse ‘the full and equal enjoyment of [its] services’ based on a customer’s protected status . . . the dissent assures us that a company selling creative services ‘to the public’ does have a right ‘to decide what messages to include or not to include . . .’ But if that is true, what are we even debating?’

Gorsuch wrote that rather than address the key aspects of the case, the dissent ‘spends much of its time adrift on a sea of hypotheticals about photographers, stationers, and others, asking if they too provide expressive services covered by the First Amendment.’

Friday’s decision reversed a lower court ruling that sided against Smith, who said the law infringed on her First Amendment rights by forcing her to promote messages that violate her deeply held faith.

The high court’s majority stated that ‘under Colorado’s logic, the government may compel anyone who speaks for pay on a given topic to accept all commissions on that same topic — no matter the message — if the topic somehow implicates a customer’s statutorily protected trait.’

Sotomayor dissented from the majority, along with Justices Elena Kagan and Ketanji Brown Jackson. They called the ruling ‘a new license to discriminate’ and said the ‘symbolic effect of the decision is to mark gays and lesbians for second-class status.’

‘The unattractive lesson of the majority opinion is this: What’s mine is mine, and what’s yours is yours. The lesson of the history of public accommodations laws is altogether different. It is that in a free and democratic society, there can be no social castes,’ Sotomayor said.

The case, 303 Creative LLC v. Elenis, drew national attention as it featured competing interests of the First Amendment right to free speech and non-discrimination against LGBTQ people.

Fox News Digital’s Andrew Mark Miller contributed reporting.

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Former New York state Democrat Sen. Alessandra Biaggi took to social media Friday to discuss the pricey student loans she had amassed during law school, despite purchasing a $1.14 million home last summer.

‘In 2012, I graduated from Fordham Law School with $180,000 is student loan debt,’ Biaggi wrote in a tweet. ‘I’ve been paying loans for 11 years. Even paid two of them off completely.’

‘In 2023, my balance is $206,000,’ added Biaggi, who represented New York’s 34th district during her three-year tenure in the state Senate.

The remarks from Biaggi — who posed an unsuccessful primary challenge to former Rep. Sean Patrick Maloney, D-N.Y., in the 2022 midterm elections — came nearly one year after it was reported that she and her husband had purchased and moved into a $1,137,500 home located in the state’s 17th Congressional District, which she had hoped to represent in Congress.

Biaggi, 36, and her husband, Nathaniel Koloc, puchased the three-bedroom, two-bathroom home in an upscale suburban area in July 2022, the New York Post reported last year.

The Post also noted that the house was a significant upgrade over Biaggi’s previous residence, a $691,006 condo in Pelham, New York, where she was registered to vote. 

Biaggi’s comments followed a decision from the Supreme Court to strike down President Biden’s student loan-forgiveness plan, with the high court concluding that the White House lacked the legal authorization to provide billions in federal loan forgiveness for borrowers, absent clear authorization from Congress.

The move by the Supreme Court will prevent more than 40 million low- and middle-income borrowers from receiving $10,000 in federal loan forgiveness under the Biden administration’s plan — and is a major defeat for the president on one of his key 2020 election campaign promises.

Several social media users were quick to point out that Biaggi should have paid off her student loans before purchasing the expensive home located in Bedford, New York.

‘You need Dave Ramsey, not Joe Biden,’ Christopher Rufo, a senior fellow at the Manhattan Institute, told Biaggi in a tweet. Ramsey is a prominent radio host who offers financial advice.

Responding to Biaggi, another user wrote: ‘You signed the loan agreement. Didn’t you read it?’

‘She could afford to buy a $1 million home but not pay off $180K of debt,’ Greg Price, communications director for the State Freedom Caucus Network, noted in a tweet.

Offering his perspective on the issue, retired marine and talk show host Jesse Kelly wrote in a tweet: ‘BREAKING: Woman spends more than she makes.’

Originally announced by Biden from the White House last August, the debt-forgiveness plan would have canceled $10,000 of federal student loan debt for certain borrowers making less than $125,000 per year, and up to $20,000 for Pell Grant recipients.

Fox News’ Paul Steinhauser contributed to this report.

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Presidential candidate Nikki Haley faced criticism from a fellow GOP presidential candidate after calling for the impeachment of President Biden over whistleblower claims there was intentional federal interference in the probe targeting his son Hunter.

‘Somebody needs to do it,’ Haley told Fox News’ Greg Gutfeld when asked about Congress potentially seeking to impeach Biden over the allegations as he ramps up his campaign for re-election next cycle. ‘If the Justice Department’s not going to do it, Congress should do it. But somebody needs to do it. It smells bad all day long.

‘You’re not talking about just some guy that showed up and decided to say something,’ Haley added, suggesting the whistleblower was a credible source.

While the presidential candidate believes immediate action should be taken against Biden, GOP candidate and former Arkansas Gov. Asa Hutchinson, also in the running for the Republican presidential nomination in 2024, said ‘impeachment should not be used as a political weapon.’

IRS Special Agent Gary Shapley Jr., supervisor of the Hunter Biden investigation at the IRS, revealed that during the investigation into the president’s son, ‘we weren’t allowed to ask about ‘the big guy,” referring to a prohibition on asking witnesses questions. 

Numerous reports suggest Hunter Biden referred to his father as ‘the big guy’ in communications.

Shapley also conveyed the information in testimony to the House Ways and Means Committee, where he noted Department of Justice (DOJ) prosecutors purposely chose not to obtain search warrants related to Hunter Biden.

‘While the whistleblower allegations are serious and must be investigated, impeachment should not be an option until the investigation shows corrupt action by the president,’ Hutchinson said in a press release Friday reacting to Haley’s statement. 

The Republican argued a ‘thorough investigation’ should be conducted before there are calls for impeachment.

‘Impeachment should not be used as a political weapon but reserved for serious wrongdoing,’ Hutchinson said. ‘The facts should determine what action, if any, Congress should take, and impeachment should not precede a thorough investigation.’ 

A spokesman for Haley’s campaign reiterated the former U.N. ambassador’s position. 

‘Nikki believes Congress needs to get to the bottom of whether Joe Biden committed crimes or other impeachable offenses since the Justice Department refuses to do it. That process starts with a congressional oversight investigation,’ said Haley spokesman Ken Farnaso.

Wyn Hornbuckle, deputy director of the Justice Department Office of Public Affairs, immediately denied Shapley’s shocking claims regarding the investigation.

‘As both the attorney general and U.S. Attorney David Weiss have said, U.S. Attorney Weiss has full authority over this matter, including responsibility for deciding where, when and whether to file charges as he deems appropriate,’ Hornbuckle said in a statement. ‘He needs no further approval to do so.’ 

The whistleblower came out after Hunter Biden agreed to plead guilty to two misdemeanor counts of willful failure to pay federal income tax and a separate charge for possessing a firearm while acting as an unlawful user and addict of a controlled substance.

Fox News’ Brooke Singman contributed to this report.

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Democratic presidential candidate Robert Kennedy, Jr. took aim at President Biden Friday over his ‘failure’ to unite Congress, insisting it led to the ‘predictable’ Supreme Court decision to strike down the president’s student loan forgiveness plan.

‘The unfortunate SCOTUS ruling striking down President Biden’s student loan forgiveness program was the predictable result of Biden’s failure to bring Congress together on this issue of crucial importance to young Americans,’ Kennedy said in a statement shared with Fox News Digital.

‘President Biden knew his plan wouldn’t survive a legal challenge. His plan gave the appearance of action while accomplishing nothing. 

‘This is an issue of grave importance to our country. As president, I will galvanize public support to pressure Congress to put down their partisan positions and legislate meaningful relief to the tens of millions of Americans who are drowning in student debt.’

Kennedy said he would also ‘take steps to reduce education costs for students,’ suggesting that college could ‘be virtually free’ in the United States if government ‘devoted even a fraction of our military budget to higher education.’

‘When I was their age, a college education cost about one-seventh of what it is today. A young person could work their way through college and graduate debt-free,’ he said. ‘If we devoted even a fraction of our military budget to higher education, it could be virtually free to all (as it is in many other countries).

SUPREME COURT RULINGS LIKELY TO INTENSIFY CALLS FROM THE LEFT TO ‘PACK’ THE COURT

‘Funding higher education is not an entitlement program, it is an investment in America’s future, just as with infrastructure and environment. Let’s invest in America’s young people instead of in the forever wars.’

Kennedy’s remarks came a few hours after the high court, in a 6-3 decision, ruled that the White House lacked the legal authority to provide billions in federal loan forgiveness for borrowers, absent clear authorization from Congress.

The move by the Supreme Court will prevent more than 40 million low- and middle-income borrowers from receiving $10,000 in federal loan forgiveness under the Biden administration’s plan and is a major defeat for the president on one of his key 2020 election campaign promises.

Originally announced by Biden from the White House in August, the plan would have canceled $10,000 of federal student loan debt for certain borrowers making less than $125,000 per year and up to $20,000 for Pell Grant recipients.

While Kennedy expressed concern over the Supreme Court’s ruling, Republican presidential candidates like Sen. Tim Scott, R-S.C., and former Vice President Mike Pence applauded the court’s decision.

Fox News’ Paul Steinhauser contributed to this report.

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The first half of 2023 is ending on a positive note—inflation was cooler than expected. But a few days ago, the market wasn’t so optimistic.

In an economic forum, Fed Chairman Jerome Powell suggested that two more interest rate hikes are likely this year. This was based on the thought that the last 10 rate hikes may not have worked their way through the economy. Overall, economic data supports this idea. The labor market is still strong, the US economy is growing (Q1 GDP was revised to 2% from 1.3%), and big banks passed the stress test. But the core personal consumption expenditures price index came in lower than expected, a sign that inflation is cooling.

Does that mean the Fed will stop tightening? The stock market may think so, but one piece of data isn’t enough to sway the Fed. The CME FedWatch Tool shows an 86.8% probability of a 25 basis point rate hike in its July meeting. 

The Stock Market’s First Half of 2023

If you were focused on the broader equity indexes, you wouldn’t think the markets are worried. Equity values keep moving higher, driven mostly by the Technology sector. The PerfChart below shows that the Nasdaq 100 index ($NDX) outperformed the S&P 500 index ($SPX), the Dow Jones Industrial Average ($INDU), and the Nasdaq Composite ($COMPQ) in the first half of 2023.

CHART 1. STOCKCHARTS PERFCHARTS OF BROADER INDEXES. The Nasdaq 100 Index is the clear leader. Chart source: StockCharts.com. For educational purposes only.

The S&P Sector Summary also supports the outperformance in tech stocks. The three top-performing sectors in the last six months were Technology, Communication Services, and Consumer Discretionary. This suggests investors are gravitating toward growth stocks.

CHART 2: SECTOR SUMMARY (PAST SIX MONTHS). Technology, Communication Services, and Consumer Discretionary are the top three performing sectors. Chart source: StockCharts.com. For educational purposes only.

Bond Market Watch

But if the Fed raises interest rates a couple more times this year, does it change the economic picture? It could, which is why it may be worth watching the bond markets. An inverted yield curve can be a sign that bond investors may be worried.

What is an inverted yield curve? In a nutshell, it’s when shorter-dated Treasury yields are above longer-term yields.

The difference between the 10-year Treasury yield and the 2-year Treasury yield (2/10 Treasury spread) has been below 0 since July 2022 (see chart below). The spread has almost reached the March low, which is around the time when the S&P 500 started gaining bullish momentum. When Fed Chairman Jerome Powell indicated the central bank would likely raise rates two more times this year, the 2/10 spread fell lower. And if short-term rates go higher, the spread could fall even lower.

CHART 3: THE 2/10 TREASURY SPREAD. The spread between the 10 and 2-year Treasury yields is approaching March lows. You might want to keep an eye on this spread. Chart source: StockCharts.com (click on chart for live version). For educational purposes only.

Does this mean a recession is a possibility? While an inverted yield curve could mean a recession is possible, it’s not guaranteed. If inflation has peaked and moves toward the Fed’s 2% target, it’s possible that the US may avoid a recession. It’s too early to tell, and it takes a while for the effects of interest rate tightening to weave their way into the economy. Until then, keep your eyes peeled on the broader market.

Nasdaq 100 Technical Outlook

Since the Nasdaq 100 index led in performance, it’s worth taking a closer look at its chart. The weekly chart of $NDX below shows that the index is close to its all-time high of just above 16,000. But before it gets there, it has to cross over its June 12 high of 15,284 (red dashed line). If it does, there may be a few more hurdles to pass. The question is, will there be enough momentum to push the NDX higher? To answer this question, it’s helpful to add a momentum indicator to the chart.

CHART 4: WEEKLY CHART OF NASDAQ 100 INDEX. NDX has a few headwinds to go through before reaching its all-time highs. Chart source: StockCharts.com (click on chart for live version). For educational purposes only.

StockCharts has a huge collection of momentum indicators to choose from. One that combines different cycles is the Know Sure Thing (KST), which is displayed in the panel below the price chart. The KST indicator is in positive territory and moving higher, which suggests that momentum is still strong. There’s no sign of KST falling below its signal line on the weekly chart.

It also helps to add Fibonacci retracement levels to the chart. If NDX falls lower, the 38.2% retracement level could also be a potential support level.

But what about the daily chart?

CHART 5: DAILY CHART OF NASDAQ 100 INDEX. NDX could pull back if momentum starts to slow. Chart source: StockCharts.com (click on chart for live version). For educational purposes only.

On the daily chart, NDX has bounced off its 20-day simple moving average (SMA), but KST has crossed below its signal line. It would be worth watching this indicator since NDX could pull back to its 20-day SMA and either bounce off it or go below it.

So even though Tech stocks have been on a bullish rally, there’s the risk of overvaluation. There’s also the possibility of a couple interest rate hikes this year, which could deepen the yield curve inversion. So, going forward, even if equities continue to rally, it’s best to keep an eye on momentum. If it starts weakening, look at other parts of the market like bonds. What’s the yield curve scenario? What about commodities? Or emerging markets?

Keep an eye on the big picture by setting up Your Dashboard to include Market Overview, Sector Summary, Market Movers, and SCTR Reports.

Final Thoughts

Now that the first half of 2023 is behind us, it’s a good time to do a mid-year portfolio checkup. Has your portfolio returned as much or better than a benchmark index such as the S&P 500? If not, it may be worth analyzing the different asset classes you own to identify what needs to be fixed and why. This can help you make strategic changes if necessary. Let’s hope for a strong second half, but, with the markets, anything is possible. Keeping an eye on the various moving parts like momentum, the yield curve, and overall economic indicators would make you a more astute investor.

End-of-Week Wrap Up

US equity indexes up; volatility up

$SPX up 1.23% at 4450.38, $INDU up 0.84% at 34,407.60; $COMPQ up 1.45% at 13787.92$VIX up at 13.59Best performing sector for the week: Real EstateWorst performing sector for the week: Consumer StaplesTop 5 Large Cap SCTR stocks: NVDA, CCL, IOT, PLTR, MDB

On the Radar Next Week

June ISM Manufacturing PMIFOMC MinutesMay JOLTs Jobs reportMortgage ratesJune Nonfarm payrolls (NFPs)

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

The 2023 Superbowl was a great one. It started with a strong first half for the Philadelphia Eagles. The Eagles fans were soaring with delight as the teams headed to the locker rooms. KC fans were dejected by the outstanding performance of Jalen Hurts. With Kansas City down 10 points and Mahomes on a damaged ankle, it looked best to stay with what was working and winning.

Then Rihanna performed the half time show in a larger than life production, complete with floating platforms.

Image by Greg Schnell

In hindsight, it looked like each platform was placed for the odds of an Eagles win. The top of the arc was the half time show and each successive KC touchdown dropped the eagles odds of winning.

In the second half, Kansas City scored 3 touchdowns and Philadelphia scored 11 points to make it a tie ball game with a couple of minutes to go. It all came down to the final field goal, and KC kicked to win with 8 seconds left.

Image by Greg Schnell

It was a thriller. An emotional roller coaster. It came up just short of being the highest scoring Superbowl of all time. It had it all. Foregone conclusions, one sided performances, new names jumping to the top of football lore. It had close calls, bad calls, heartbreaking moments, and stunning redemption.

In a way, it reminds me of the first half of 2023 for the investing landscape.

The first half of investing for 2023

We have seen one of the best Nasdaq first half performances since the 1980’s. The foregone conclusion of a recession has been invisible. One sided performances were in the Mega cap names while other markets like the Russell 2000 didn’t go anywhere.

The technology and discretionary sectors were strong leaders but who expected META in the communications sector to be one of the crazy winners? Meta went from $380 down to $90, and then ran up the field to $290. AI became the new buzz word. Software and semiconductors had their redemption after an awful 2022.

Banks looked like they were going to plummet under the weight of the sudden interest rate increases, but it was a close call that didn’t unwind any further.

The first half of the 2023 investing season was dominated by the large cap players. Apple tagged the 3 trillion dollar market cap on the last play of the half. Compared to the $SPX, the leadership was focused on the first three sectors for a bull market.

I think it is important to notice the industrials and materials were the next best performers. This chart has the growth sectors on the left, and the defensive sectors are on the right. Energy and utilities were the worst but financials and healthcare were not far behind.

The second half group of the growth sectors

Looking in on the next sectors after the winning three, there are some positive signs emerging. An example would be the industrial chart is breaking out to new highs to start the second half.

XLB is threatening to break the downtrend to kick off the third quarter. I’ve used a line chart as there were a couple of extra long intra week price bars that didn’t look like part of the trend. Both charts, bar and line charts, convey the same message. We are close to an upside breakout.

For energy, the XLE (broad energy ETF) doesn’t look as close to a breakout as the XOP (exploration and production) chart. The XOP is breaking out the last couple of days.

Here is the XOP.

The half time show

We are now half way through the year. I’ll be doing the half time show on the monthly conference call at Osprey Strategic on Saturday morning. New clients will be able to listen to recording and can try out everything we offer for just $7 for the first month. My expectation is the next three sectors should make for a fabulous second half and I’ll lay out the reasons why during the conference call and the weekly newsletter.

Anyone out shopping for a home on the resale market knows the pickings are slim. They’re about to get slimmer. 

The number of homes for sale this month was actually 7% higher than in June of last year, according to Realtor.com. But, in just the last week, that comparison went negative, with the number of homes for sale falling below year-ago levels for the first time in 59 weeks.

New listings in the last week of June were down 29% from the same week a year ago. That’s a wider drop than in previous weeks.

With mortgage rates surging ever higher, crossing over 7% again on the 30-year fixed Thursday, according to Mortgage News Daily, homeowners have very little incentive to sell their homes. The vast majority of homeowners with mortgages have rates below 4%, with some even below 3%.

An even tighter housing market ahead means home prices are unlikely to cool. Prices peaked last June, after rising over 45% from pre-pandemic levels. They began to fall because mortgage rates had doubled in a matter of months. But prices bottomed in January, according to the latest S&P Case-Shiller home price index, despite still higher interest rates and slower sales.

“The ongoing recovery in home prices is broadly based,” Craig Lazzara, managing director at S&P DJI, said in a release.

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Pending sales, which measure signed contracts on existing homes, fell nearly 3% in May from April, according to a report Thursday from the National Association of Realtors.

“Despite sluggish pending contract signings, the housing market is resilient with approximately three offers for each listing,” NAR’s chief economist, Lawrence Yun, said in a release. “The lack of housing inventory continues to prevent housing demand from being fully realized.”

On the flip side, the nation’s homebuilders have been big beneficiaries of the tight market, seeing sales jump 12% in May from April, according to the U.S. Census. Higher mortgage rates have been less of a factor, as builders, some of whom have their own mortgage arms, have been buying down rates for buyers. In May, there were twice as many homes that were sold but hadn’t been started as there were a year ago.

While single-family housing starts are finally increasing, they are still well below historical levels. Builders have also been underbuilding since the great recession, meaning the market was undersupplied well before the recent, pandemic-induced run on housing.

“Bottom line, for all the excitement in the home builders because of the need for more supply, the existing home market is depressed and experiencing a serious case of stagflation with little transactions taking place but at still very high prices,” wrote Peter Boockvar, chief investment officer at Bleakley Financial Group.

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A top adviser to Dr. Anthony Fauci at the National Institute of Allergy and Infectious Diseases (NIAID) has admitted to using his personal email account to skirt Freedom of Information Act requests and went so far as to delete some emails during the pandemic, according to records obtained by House lawmakers investigating the origin of the coronavirus pandemic.

The emails were revealed Thursday by the House Select Subcommittee on the Coronavirus Pandemic, which claimed Dr. David Morens, whose tenure with the NIAID spans roughly 25 years, may have broken the law.

In an email exchange between Morens and Bloomberg reporter Jason Gale, Morens made clear that he had to receive approval from the White House and the Department of Health and Human Services to talk about the ‘origins’ of COVID-19.

‘Sometimes they are touchy about certain issues and say no. For many months, I have not been approved to talk about the ‘origins’ on the record,’ Morens wrote in the email, which was first published by The Intercept.

‘But today, to my total surprise, my boss Tony [Fauci] actually ASKED me to speak to the National Geographic on the record about origins. I interpret this to mean that our government is lightening up[,] but that Tony doesn’t want his fingerprints on origin stories,’ he added in the July 29, 2021, email to Gale.

In other emails, Morens expressed concern over what was sent to his work email and what was sent to his personal email, informing those on the email chain that they did not need to worry and that he would ‘delete anything I don’t want to see in the New York Times.’

‘As you know, I try to always communicate on gmail because my NIH email is FOIA’d constantly,’ Morens wrote in a September 2021 email, which was sent at the time to many scientists involved in the debate over the origins of COVID. ‘Stuff sent to my gmail gets to my phone … but not my NIH computer.’

‘Don’t worry, just send to any of my addresses, and I will delete anything I don’t want to see in the New York Times,’ he added in the email.

In a Sept. 7, 2021, email, EcoHealth Alliance President Peter Daszak wrote to Morens about previous reporting from The Intercept on coronavirus research in Chinese labs, saying, ‘The lab leakers are already stirring up bulls–t lines of attack that will bring more negative publicity our way — which is what this is about — a way to line up the [gain-of-function] attack on Fauci, or the ‘risky research’ attack on all of us.’

‘Do not rule out suing these a–holes for slander,’ Morens replied, referencing the report.

Earlier this month, it was revealed by the Government Accountability Office that EcoHealth Alliance had sent more than $2 million in subgrants from NIH and the US Agency for International Development to the Wuhan Institute of Virology between 2014 and 2021.

Brad Wenstrup, R-Ohio, who serves as chair of the subcommittee, sent a letter Thursday to Morens about the documents the House lawmakers had obtained. IN the letter, Wenstrup told Morens the documents obtained by the committee ‘suggest that you may have used your personal e-mail to avoid transparency and the Freedom of Infor mation Act (FOIA), potentially intentionally deleted federal records, and acted in your official capacity to disparage your fellow scientists, including by encouraging litigation against them.’

In the letter, the committee also said that the email about Fauci not wanting any ‘fingerprints’ on the matter raises ‘concerns that you may have knowledge or information suggesting Dr. Anthony Fauci … wished to influence the COVID-19 origins narrative without his ‘fingerprints.’’

‘This is all very troubling and raises serious questions,’ Wenstrup wrote to Morens.

The select subcommittee has requested that Morens produce a number of additional records, some from his personal device, and to sit for an interview.

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