As I’m sure you’ve heard, Tropical Storm Hilary has drenched Southern California.

Southern Californians are battling flooded roads, mudslides and downed trees…

Dodger Stadium is currently underwater…

And now the storm is threatening Nevada and could cause catastrophic flooding as far north as Oregon and Idaho.

At the same time…

Maui is still reeling from a blaze that ravaged the historic town of Lahaina and killed more than 100 people, which makes it the deadliest U.S. wildfire in more than a century.

And while it’s been underreported here in the U.S., firefighters in Canada are still battling the country’s worst fire season on record.

Add it all up, and we’re looking at one of the worst bouts of extreme summer weather in recent memory – which could be the trigger catalyst for three trades.

YOUR ACTION PLAN

With all these extreme weather events happening simultaneously, we could see a pop in energy and home improvement stocks like Home Depot (NYSE: HD), Lowe’s (NYSE: LOW) and even Generac Holdings (NYSE: GNRC).

As I noted in The War Room this morning, GNRC is a growth stock that’s currently trading at the price of a value stock… Home Depot just announced a $15 billion stock buyback last week after beating Q2 expectations (even though it warned that shoppers are remaining cautious)… and LOW reports earnings before the open tomorrow.

To see how we’re trading these three stocks, you’re invited to join us inside The War Room.

MONDAY MARKET MINUTE

• About Last Week… Ouch. The major market averages got slammed last week, as the Dow dropped 780 points en route to a 2.2% loss, the Nasdaq dropped 2.6% and the S&P 500 fell 2.1%. As we head into a new trading week, will the bulls look for dip-buying opportunities? That’s what I’ll be tracking to start the week.
• Fed in Jackson Hole. All eyes will be on Fed Chairman Jerome Powell’s speech on Friday at the Fed’s annual economic symposium in Jackson Hole, Wyoming. Jackson Hole was originally chosen as the site of the symposium to lure then-Chairman Paul Volcker, who was an avid fly fisherman, to attend – and it still hosts the event more than 40 years later. (Having just gotten back from Big Sky, Montana, I can attest to the allure of casting a fly and waiting for the trout to rise. There’s really nothing like it.)
• An AI Pick-and-Shovel Play. As artificial intelligence (AI) continues to be a hot-button topic, one name that might be worth consideration is Marvell Technology (MRVL), which makes the chips that are used in data-center networking. Marvell’s AI-related business is currently worth around $200 million, and that should double in each of the next couple of years. Many consider this an AI “pick-and-shovel” play, and I think it’s worth watching.
• Earthstone Energy (ESTE) Sees Big Move. The energy company was up over 18% earlier today after entering a definitive agreement to be acquired by Permian Resources (PR) in an all-stock transaction worth approximately $4.5 billion.