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The month that was:
In August, the Dow went up by about 3.2%, the S&P 500 went up by about 1.9%, and the Nasdaq went up by about 1.6%. The Dow closed at a record high for the first time this year on August 22nd.
The month started with bad news. On August 1st, the government's jobs report showed that companies added only 73,000 jobs in July. Even worse, the numbers for May and June were revised down by a total of 258,000 jobs, which meant the job market was much weaker than people thought. The S&P 500 fell about 1.6% that day. Later that day, President Trump fired the head of the Bureau of Labor Statistics, the government agency that makes the report. On August 22nd, Fed Chair Powell said at the Jackson Hole meeting that the Fed might soon cut interest rates because the job market was slowing, and the market jumped.
The jobs report comes out on the first Friday of almost every month. It tells us how many jobs American companies added or cut in the past month, and what percentage of people who want a job can't find one, which is called the unemployment rate. Investors watch it closely, because when people have jobs, they spend money, and spending drives most of the U.S. economy.
The jobs report is also important for the Fed. The Fed has two goals, which are keeping prices stable and keeping as many people employed as possible. When the job market is strong, the Fed can focus on fighting inflation. When the job market gets weak, the Fed is more likely to cut interest rates to help the economy. That's why a weak jobs report can sometimes make the market go up, if investors think it means rate cuts are coming. This month, the market fell at first because investors worried about a recession, but then it went up as they started expecting a rate cut in September.
Buys -
Bought 20 NVO at $51.85
Novo Nordisk lowered its forecast in late July because its weight loss drugs are facing more competition, especially from Eli Lilly and from cheaper copies of its drugs. The stock fell about 22% in one day, and it is now about two thirds below its high from last year. Novo has a new CEO, and I think the stock is very cheap, so I added more shares.
Bought 3 UNH at $294.23
I bought back three shares of UnitedHealth. That evening, it was revealed that Warren Buffett's company, Berkshire Hathaway, had bought a big stake in UnitedHealth, and the stock jumped about 12% the next day.
Bought 5 ACN at $248.71
Bought 3 ADBE at $353.98
Accenture and Adobe have both fallen a lot this year because of worries about AI. I added a few shares of each at lower prices.
Bought 20 CPRT at $47.19
Copart runs online auctions for used and damaged cars, mostly for insurance companies. It is a very high quality company with almost no debt. I started a new position.
Sells -
Sold 7 IBKR at $63.85
Interactive Brokers did a 4-for-1 stock split in June, so my shares from March and April turned into four times as many shares at a quarter of the price. Since then, the stock has gone up a lot. I sold 7 of my shares for a profit of about 59%.
Sold 8 FIG at $85.05
Figma's stock fell a lot in the week after its IPO, as I warned it might. I sold my shares for a loss of about 17%.
Sold 6 FDS at $388.42
Sold 4 EFX at $241.88
Sold 5 DECK at $103.58
Sold 5 DHR at $196.38
I sold some shares of FactSet, Equifax, and Deckers for small losses, and my Danaher shares for a small profit.
Buys and Sells -
Bought 2 IT at $336.90
Sold 5 IT at $236.65
On August 5th, Gartner lowered its forecast for the year, partly because government spending cuts hurt its business, and the stock fell about 28% in one day. I had bought two more shares the day before. I sold my shares for a loss of about 36%. Once again, buying right before earnings hurt me.
Bought 12 FTNT at $71.67
Sold 5 FTNT at $73.56
Fortinet makes cybersecurity products that protect company networks. On August 7th, Fortinet's stock fell about 22% after its earnings report. I bought shares after the drop, and sold a few the next day for a small profit.
Bought 3 ALSN at $88.08
Sold 5 ALSN at $87.71
Bought 1 TMO at $489.31
Sold 1 TMO at $452.79
I also made small trades in Allison Transmission and Thermo Fisher.
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