CHRIS VERSACE: Good morning, Action Alerts Plus members. It's Monday, October 10. We have a quiet start to the week with little in the way of expected earnings reports and economic data, but that will change rather quickly with the September CPI and PPI reports due out later this week as well as the retail sales report for the month late in the week.

This week also sees the September quarter earnings season kick into high gear with, as members know, results slated this week from PepsiCo but also Taiwan Semiconductor and another slew of banks.

Before we get to that point, however, we have yet another round of Fed head speakers talking today, really reiterating, we think, what we heard last week, not only that the Fed is going to continue to go bigger and longer, but more likely than not even bigger than when we had thought previously because of the downtick in the September employment report that we saw for the unemployment rate.

Also this morning, we had the negative earnings preannouncement from PPG. The company not only cut its guidance but shared the factors that led to that cut and there are things that we've heard before-- namely weakening demand in Europe, currency headwinds, and raw material cost inflation.

To us, this is simply the latest log on the negative earnings preannouncement fire. And as we shared with members last week, we continue to see more of those reports leading into the September quarter earnings season.

So stepping back a little bit, in our view, what are the three focal points for the week? First, it's going to be what does the inflation data really tell us. But, as we see it, even if we see a modest improvement, it's not going to deter the Fed following what we saw last week. And, again, Fed heads are likely to be out this week reminding us.

We also shared last week that we saw the CME Fed watch tool calling for the Fed to move significantly by the end of its February 2023 monetary policy meeting. We do not see that backing down any time soon.

We were also-- as we said, we're in the throes of the September quarter earnings season and we continue to think that we're going to see a rethink for earnings expectations for the second half of the year-- in other words, more downward revisions likely to be had, pressuring the market.

And with those two things in play, the third item that we're going to be watching this week is going to be the technical support level for the S&P 500. That is at 3,600.

How are we going to start the week off with the portfolio? We're going to remain in our defensive posture, no change to that. The slow and prudent path that we will remain on.

Now, in terms of the portfolio's constituents, Amazon is going to kick off its Prime Early Access Sale tomorrow, October 11, and it runs through October 12.

Candidly, expectations are running a little high, with some saying that Amazon could win one out of every five consumer dollars spent on those two days alone. If that comes to pass, and we expect Amazon to make some noise after the event, it will not only be a positive for Amazon but also for the portfolio's position in UPS shares.

And before we wrap today's rundown, Ford Motor shares received a downgrade by UBS. That is indeed pressuring the shares yet again. The downgrade hinges on recession risk in Europe, which we would say is not exactly new news, given the PMI data and other data that we've been receiving in recent months.

We would argue that that's largely baked into Ford's share price, we'd also point out that North America-- meaning the US, Canada, Mexico-- is more than 75% of Ford's revenues. But, nevertheless, despite these facts, the shares are trading off today. Our message to members that are underweight Ford shares is to be patient and wait for the right opportunity, given what we see as the longer term valuation expansion prospects as the EV business continues to grow. Remember, there's two longer term drivers for that. The first is the continued subsidies for EVs as well as the very high average age of autos in the US.

That's the Daily Rundown for today. We'll be back with you tomorrow.