"A great business at a fair price is superior to a fair business at a great price."- Charlie Munger
This aphorism underscores the principle that owning outstanding companies at reasonable valuations yields more reliable long-term returns than chasing deep discounts on inferior businesses. Superior business quality compounds growth and reduces risk, making patience more valuable than bargain hunting alone.
Adopting this approach helps investors cultivate patience, focus on fundamentals, and build enduring wealth.
Market Wrap
Court Halts Tariffs as Fed Opts to Wait
Trade Court Blocks “Liberation Day” Tariffs:
On May 28, the U.S. Court of International Trade ruled that President Trump exceeded his authority under the International Emergency Economic Powers Act by imposing broad “reciprocal” tariffs on imports, blocking the measures from going into effect and bolstering U.S. stock futures and risk assets.
Treasury Proposes Easing Bank Capital Rules:
Treasury Secretary Scott Bessent unveiled a plan to lower the supplementary leverage ratio for banks—aimed at encouraging more Treasury purchases and lending—which briefly pushed U.S. Treasury yields down and supported a rally in both bond and equity markets.
FOMC Meeting Minutes Highlight Elevated Uncertainty:
Minutes from the May 6–7 Federal Open Market Committee meeting revealed policymakers’ concerns over persistent inflation risks and the dual impacts of tariffs—potentially slowing growth while driving up prices. Officials unanimously held rates at 4.25–4.50% and signaled a “wait-and-see” approach until trade-policy effects become clearer.
Richmond Fed Manufacturing Index Improves:
The Federal Reserve Bank of Richmond reported its May manufacturing index at –9, up from –13 in April, indicating the regional manufacturing contraction moderated slightly but remained in negative territory.
Nvidia Corp. shares jumped 5% in after-hours trading following the company’s first-quarter earnings beat and upbeat outlook, as surging data center demand and AI growth outweighed concerns over export restrictions to China.
Okta Inc. shares plunged 16% despite reporting strong revenue growth, as management warned that ongoing economic uncertainty could dampen enterprise IT spending in the coming quarters.
GameStop Corp. shares dropped 11% after the video game retailer announced a $500 million bitcoin purchase program, as investors questioned the strategic shift amid a modest pullback in cryptocurrency prices.
Joby Aviation Inc. shares jumped 29% on news that Toyota led a $250 million investment in the electric air taxi developer, underscoring growing confidence in its commercialization timeline and partnerships.
Vail Resorts, Inc. shares surged after the company announced the return of former CEO Rob Katz, with investors betting the leadership change will help navigate recent operational challenges and drive renewed growth in its mountain resort business.
Abercrombie & Fitch Co. shares soared 15% after the retailer raised its full-year sales forecast, signaling resilience to a projected $50 million in tariff costs and stronger-than-expected consumer demand for its spring collections.
Macy’s, Inc. shares rose 2% in after-hours trading as the department-store chain beat first-quarter earnings estimates with adjusted EPS of $0.16, though the company warned that tariffs and subdued consumer spending would weigh on full-year profit outlook.
AMC Entertainment Holdings Inc. shares fell 14% after earlier gains from a blockbuster Memorial Day box office weekend were offset by profit-taking and concerns over the sustainability of theater attendance trends.
Monro Inc. shares surged 30% after the auto service chain reported quarterly earnings that exceeded analyst expectations, driven by strong same-store sales and margin expansion.
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