CHRIS VERSACE: Good morning, Action Alerts PLUS members and welcome to another shortened trading week. As we return from the long weekend, we're lighter on the data front, but we will be hearing from a few Fed speakers today ahead of Fed Chair Powell's back-to-back testimony in Washington on Wednesday and Thursday.

Now, following last week's Fed meeting that suggested we could see two more rate hikes this year, we'll be listening today to see what tone Powell is likely to take later this week. As we see it, he has to delicately balance why the Fed may need to do even more to fight inflation. And explain why any additional action to be taken isn't expected to torpedo the economy and kick start one of the most anticipated recessions in recent history.

From our perspective, we expect Powell and the Fed heads will signal the need to be vigilant, but ultimately, the Fed will remain data-dependent. That means we, too, will continue to watch the data and be data-dependent in our thinking about the economy, Fed policy, and of course, adjusting the AAP portfolio as needed. In particular, we'll be watching for progress on core inflation. Now, remember, so far, the market has underestimated the lengths the Fed would go to tame inflation. But we are likely far closer to the end of monetary policy action than we were when we entered 2023.

Moving on to some individual positions. Strong guidance this morning from US Steel has us once again eyeing our positions in Vulcan Materials and United Rentals. Early today, US Steel issued upside guidance for the current quarter, making it the latest confirmation point for ramping infrastructure spending. Cementing, as we like to say, the ramp that we've seen in the monthly construction spending data.

Also today, a positive surprise as well in the form of May housing starts data that, again, were stronger than expected, which, excuse me, suggests we may be seeing a bottoming out in residential construction. In terms of our positions, Vulcan Materials shares are up about 28% since mid-March. And United Rentals' shares have rocketed higher by almost 25% since mid-May. As you know, we are not ones to shy away from recognizing some gains in the portfolio when we see outperformance like this.

Now, let's turn to Lockheed Martin ahead of its investor day today by competitor Raytheon. Raytheon reiterated its 2023 guidance. And we expect the day will showcase a number of favorable data points for defense spending. Those comments should-- sorry, folks, a little too many S's here-- should those comments support our shares of Lockheed, which we think is likely the case because we expect bullish commentary on defense spending, we expect to see some lift later today and later this week. In our view, members looking to pick up shares of Lockheed Martin near the current price, we see it as a good move.

And finally, if you didn't catch Friday's live event with Tom Lee, Helene Meisler, Doug Kass, and myself, be sure to watch your inbox in the coming days and weeks for some of the biggest moments. Thanks for watching. JD and I'll be back tomorrow to answer some of your biggest questions of the week.