December 11, 2022

Friday’s action saw the S&P 500 down 0.7% and Toronto down just 0.1%.

Costco was initially down 2.3% due to its earnings report not quite meeting expectations. But at the end of the day the stock was about unchanged. It’s hard to keep such a strong company down. But it is down about 10% from its November high and down 21% from its 52 week high which goes to show that even the strongest companies can get over-valued at times. Costco almost never gets truly cheap. I’d look for a bigger decline before buying at this point.

lululemon got hammered down 12.9% after reporting strong earnings but a more subdues outlook. I was tempted to add to my small position but did not happen to have any U.S. funds on hand to do so. It will likely continue to be a long-term winner. 

This week, the market will turn its attention to a FED interest rate hike on Wednesday and especially to any hints of whether the FED believes it is close to the end of the interest rate raising cycle. A higher-than-expected producer price inflation measure on Friday sent something of a chill through the market.

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