NYSE Dow Jones finished today at:

[bigdog]

Stock market today: Wall Street closes out its 7th straight winning week with a quiet finish

Wall Street drifted through mixed trading to put a quiet end to another rocking week. The S&P 500 finished nearly unchanged Friday, down less than 0.1%.

apnews.com

Wall Street closes out its 7th straight winning week with a quiet finish​

By STAN CHOE

Wall Street drifted through mixed trading on Friday to put a quiet end to another rocking week.

The S&P 500 finished nearly unchanged for the day, down 0.36, or less than 0.1%, at 4,719.19. But it’s still hanging within 1.6% of its all-time high set early last year, and it closed out a seventh straight winning week for its longest such streak in six years.

The Dow Jones Industrial Average, which tracks a smaller slice of the U.S. stock market, rose 56.81 points, or 0.2%, to 37,305.16 and set a record for the third straight day. The Nasdaq composite climbed 52.36, or 0.4%, to 14,813.92.

Costco helped lead the market with a 4.4% gain. It reported stronger results for the latest quarter than analysts expected and said it will send $6.7 billion in cash to its shareholders through a special $15 dividend. That helped offset a 3.6% slump for Lennar. The homebuilder reported stronger profit for the latest quarter, but it also gave a forecast for a measure of profitability in the current quarter that fell shy of analysts’ expectations.

Stocks overall bolted higher this week after the Federal Reserve seemed to give a nod toward the hopes that have sent Wall Street screaming higher since Halloween. Fed Chair Jerome Powell at a press conference on Wednesday did not forcefully push back on traders’ expectations that inflation has cooled enough for the central bank to shift to cutting interest rates after yanking them dramatically higher since early last year.

The S&P 500 has jumped roughly 15% since late October on rising hopes for just such a pivot. Lower rates not only give a boost to prices for all kinds of investments, they also relax the pressure on the economy and the financial system.

Hopes for several cuts to rates from the Fed in 2024 have sent Treasury yields tumbling in the bond market, which in turn releases pressure on the stock market.

The 10-year yield eased further on Friday. It slipped to 3.91% from 3.92% late Thursday. It had been above 5% in October and at its highest since 2007.

With inflation down from its peak, Bank of America is forecasting 152 rate cuts from central banks around the world in 2024. That would be the first year since 2020 that cuts have outpaced hikes.

Of course, some more cautious investors say markets have gotten ahead of themselves in their ebullience. The big moves seem to be predicated on the Federal Reserve pulling off what was considered a nearly impossible task not long ago.

The Fed’s goal has been to slow the economy and grind down prices for investments enough through high interest rates to get inflation under control. It then has to loosen the brakes at the exact right time. If it waits too long, the economy could fall into a painful recession. If it moves too early, inflation could reaccelerate and add misery for everyone.

That’s a lot of ifs. Plus, many critics say the number of rate cuts that traders are expecting in 2024 doesn’t seem likely unless the U.S. economy falls into a recession.

With the huge rallies so far, “markets all-in on infallible Fed,” strategist Michael Hartnett wrote in a BofA Global Research report.

Those rallies may also be threatening the futures investors are banking on. Lower Treasury yields and higher stock prices can encourage businesses and households to spend more, which keeps the economy strong but can add upward pressure on inflation.

A preliminary report on Friday indicated growth for U.S. business activity may be ticking higher. It cited “looser financial conditions,” which is another way of describing market movements that could encourage businesses and people to spend more.

“Looser financial conditions have helped boost demand, business activity and employment in the service sector, and have also helped lift future output expectations higher,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

Williamson also said a measure of pressure on inflation “remains sticky but at a level which is indicative of” inflation at the consumer level running only modestly above 2%. The Fed’s goal is to keep inflation at roughly 2% while maximizing the job market.

In stock markets abroad, Hong Kong’s Hang Seng index jumped 2.4%, with stocks of property developers rising after some Chinese cities eased buying restrictions. The Hong Kong market has been one of the world’s worst this year on worries about property developers and the overall health of the Chinese economy.

Most other markets around the world have been strong in 2023 amid hopes for cooling inflation and anticipation for cuts to interest rates.

 

[bigdog]

SX 200 expected to sink

The Australian share market looks set to give back Friday's gains and more despite a reasonably positive finish to last week on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open the day 74 points or 0.95% lower on Monday


Wall Street drifted through mixed trading on Friday to put a quiet end to another rocking week.

The S&P 500 finished nearly unchanged for the day, down 0.36, or less than 0.1%, at 4,719.19. But it’s still hanging within 1.6% of its all-time high set early last year, and it closed out a seventh straight winning week for its longest such streak in six years.

The Dow Jones Industrial Average, which tracks a smaller slice of the U.S. stock market, rose 56.81 points, or 0.2%, to 37,305.16 and set a record for the third straight day. The Nasdaq composite climbed 52.36, or 0.4%, to 14,813.92.


Market Watch

 

[bigdog]

Stock market today: Asian shares are mixed. Japan's central bank keeps its monetary policy unchanged

Asian shares are mixed after a seven-week winning streak on Wall Street cooled. U.S. futures were flat and oil prices edged higher.

apnews.com

Wall Street closes mixed after 7 straight weeks of gains​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks ended mixed on Monday as Wall Street’s seven-week winning streak cooled off.

The S&P 500 rose 0.5% and the Nasdaq composite picked up 0.6%, while the Dow Jones Industrial Average finished essentially flat after most of a 0.2% gain faded by late afternoon.

Retailers and big technology companies were among the big gainers. Amazon.com rose 2.7% and Etsy climbed 4.7% for the biggest gain among S&P 500 stocks.

Chipmaker Nvidia rose 2.4%, while Meta added 2.9% and Netflix closed 3% higher.

Energy companies also rallied as the price of crude oil jumped amid growing concerns about attacks from Iranian-backed Houthis on shipping in the Red Sea. Oil and natural gas giant BP has joined the growing list of companies that have halted shipments in the major trade route.

Valero Energy rose 2.6% and Marathon Petroleum added 2.3%.

U.S. Steel soared 26.1% after agreeing to be acquired by Japan’s Nippon Steel. The Pittsburgh steel maker played a key role in the nation’s industrialization. The all-cash deal is valued at about $14.1 billion, or $14.9 billion with debt. That’s nearly double what was offered just four months ago by rival Cleveland Cliffs.

Investors had several other corporate buyout updates to review. Photoshop maker Adobe rose 2.5% following an announcement that it is terminating its planned $20 billion buyout of Figma. Door maker Masonite International fell 16% after saying it will by PGT Innovations in a deal worth about $13 billion.

Treasury yields mostly rose. The yield on the 10-year Treasury rose to 3.95% from 3.92% late Friday.

All told, the S&P 500 rose 21.37 points to 4,740.56. The Dow edged up 0.86 points to 37,306.02, and the Nasdaq gained 90.89 points to 14,904.81.

Markets in Europe finished mostly lower, while markets in Asia closed lower.

The broader market surged last week and added to solid December gains after the Federal Reserve signaled that inflation may have cooled enough for the central bank to shift to cutting interest rates in 2024. The Dow closed out last week with a record, while the S&P 500 ended the week with its longest weekly winning streak in six years, while edging closer to its all-time high.

The benchmark S&P 500 is now up more than 23% this year, while the Nasdaq is up more than 42%.

“The winning streak, plus the fact that the Fed has pivoted as inflation continues to fall, has kicked off kind of a momentum burst,” said Michael Antonelli, market strategist at Baird. “At the end of last week, you had 70% of the S&P 500 above its 20-day moving average. That’s almost three quarters of the index rallying over the short run.”

Lower interest rates typically take pressure off of financial markets. The Fed’s goal since 2022 has been to slow the economy and grind down prices for investments enough through high interest rates to get inflation under control. Economic growth has slowed, but has not dipped into recession, while inflation continues easing.

Wall Street is betting that those conditions mean the Fed is done raising interest rates and could start cutting them in early 2024. Investors will get their last big inflation update of the year on Friday when the government releases its report on personal consumption expenditures. It’s the Fed’s preferred measure of inflation and has been easing since the middle of 2022.

Analysts polled by FactSet expect the measure of inflation to soften to 2.8% in November from 3% in October. It was as high as 7.1% in June of 2022.

Investors will also have a few big earnings reports to review this week, which could give them a better sense of how companies and consumers are faring amid high interest rates and lingering inflation. Package delivery service FedEx will report its latest financial results on Tuesday and Cheerios maker General Mills will report its results on Wednesday. Athletic footwear giant Nike will report its latest results on Thursday.

ASX 200 expected to edge higher​

The Australian share market is expected to edge higher on Tuesday following a positive start to the week on Wall Street.

According to the latest SPI futures, the ASX 200 is poised to open the day 6 points higher.

Stocks ended mixed on Monday as Wall Street’s seven-week winning streak cooled off.

The S&P 500 rose 0.5% and the Nasdaq composite picked up 0.6%, while the Dow Jones Industrial Average finished essentially flat after most of a 0.2% gain faded by late afternoon.

All told, the S&P 500 rose 21.37 points to 4,740.56. The Dow edged up 0.86 points to 37,306.02, and the Nasdaq gained 90.89 points to 14,904.81.


Market Watch

 

[bigdog]

https://www.usnews.com/news/business/articles/2023-12-19/stock-market-today-asian-shares-are-mixed-as-bank-of-japan-keeps-its-monetary-policy-unchanged

Wall Street ticks up, and S&P 500 pulls closer to a record on rate-cut hopes​

STAN CHOE ​

Wall Street ticked higher Tuesday and pulled within a good day of its record amid hopes that moves by Japan to keep interest rates easy for investors could be a preview for the rest of the world.

The S&P 500 rose 0.6% and is just 0.6% shy of its record set nearly two years ago. The Dow Jones Industrial Average gained 251 points, or 0.7%, and set its own record for a fifth straight day, while the Nasdaq composite climbed 0.7%.
Enphase Energy jumped 9.1% for the biggest gain in the S&P 500 after the maker of microinverters for the solar industry told employees it will cut 10% of its global workforce and make other streamlining changes. Stocks of oil-and-gas companies also pushed the market higher after crude prices recovered some of their sharp drops from recent months.

Around the world, stocks were mixed in mostly quiet trading. Japan was an exception, and the Nikkei 225 jumped 1.4% after the Bank of Japan decided to keep its benchmark interest rate below zero and hold other policies steady in hopes of encouraging more borrowing and spending.

The S&P 500 has rallied more than 15% since late October on hopes that a similar, easier approach to interest rates may soon be arriving on Wall Street.

With inflation down from its peak two summers ago and the economy still growing, the rising expectation is for the Federal Reserve in 2024 to pivot away from its campaign to hike interest rates dramatically.

Fed Chair Jerome Powell seemed to give a nod toward such hopes last week when he did not push forcefully against traders’ expectations for several cuts to rates next year. Wall Street loves lower rates because they give investment prices a boost and relax the pressure on the economy and the financial system.

The hope is the Fed can pull off what was earlier seen as a nearly impossible tightrope walk, by first getting inflation under control through high interest rates and then cutting rates before they push the economy into a recession.

A report on Tuesday showed the housing industry appears to be in stronger shape than expected. Homebuilders broke ground on many more homes in November than expected, roughly 200,000 more at a seasonally adjusted annualized rate.

Of course, Wall Street’s big recent moves also have critics saying the rally looks overdone and that stocks now appear expensive relative to how much profit companies are making. More cautious investors also say the number of rate cuts traders have penciled in for 2024 looks unlikely unless the U.S. economy falls into a recession.

Some Fed officials have been sounding more cautious about the prospect for rate cuts since Powell’s comments last week. On Friday, for example, the president of the Federal Reserve Bank of New York said it was “premature to be even thinking” about whether to cut rates in March.

Markets have nevertheless been ebullient, with the S&P 500 coming off its seventh straight winning week for its longest such streak in six years.

Showing how ravenous investors have become, clients at Bank of America poured $6.4 billion more into U.S. stocks last week than they withdrew. It’s the fourth-largest such inflow since the bank began tracking the data in 2008, strategist Jill Carey Hall said in a BofA Global Research report.

To Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, the S&P 500 still looks reasonably valued given moderating inflation. But she also says the risk of a “short-term pause” for the market is rising given how much fervor has built up, with one survey of investor optimism well above its long-term-average, among other potential signals of caution.

In the bond market, the yield on the 10-year Treasury slipped to 3.92% from 3.94% late Monday. It was above 5% in October, at its highest level since 2007 and putting tremendous downward pressure on the stock market.

Elsewhere on Wall Street, shares of Tylenol maker Kenvue rose 2.2% following a favorable ruling for it in federal court. The company wanted to exclude the opinions of experts in a multijurisdictional against it on whether in-utero exposure to acetaminophen, the pain reliever used in Tylenol, could lead to autism or attention deficit disorder.

Judge Denise Cote of U.S. District Court for the Southern District of New York agreed with Kenvue, ruling Monday that the testimony was inadmissible.

All told, the S&P 500 rose 27.81 points to 4,768.37. The Dow gained 251.90 to 37,557.92, and the Nasdaq climbed 98.03 to 15,003.22.

ASX 200 expected to rise again​

The Australian share market looks set for another good session on Wednesday following a solid night on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open the day 35 points or 0.45% higher this morning.

Wall Street ticked higher Tuesday and pulled within a good day of its record amid hopes that moves by Japan to keep interest rates easy for investors could be a preview for the rest of the world.

The S&P 500 rose 0.6% and is just 0.6% shy of its record set nearly two years ago. The Dow Jones Industrial Average gained 251 points, or 0.7%, and set its own record for a fifth straight day, while the Nasdaq composite climbed 0.7%.

All told, the S&P 500 rose 27.81 points to 4,768.37. The Dow gained 251.90 to 37,557.92, and the Nasdaq climbed 98.03 to 15,003.22


Market Watch

 

[bigdog]

Stock market today: Asian shares are mostly higher after a rebound on Wall Street

Shares are mostly higher in Asia after several strong profit reports helped Wall Street claw back most of its sharp loss from day before.

apnews.com

Wall Street slams the brakes for a rare slowdown following record-setting rally​

By STAN CHOE
Updated 8:26 AM GMT+11, December 21, 2023

NEW YORK (AP) — Wall Street hit the brakes on its big rally Wednesday following disappointing profit reports from companies and warnings that the market had simply gone too far, too fast.

The S&P 500 slumped 1.5% for its worst loss since beginning a monster-sized rally shortly before Halloween. The Dow Jones Industrial Average dropped 475 points, or 1.3%, from its record high, while the Nasdaq composite sank 1.5%

FedEx tumbled 12.1% for one of the market’s biggest losses after reporting weaker revenue and profit for the latest quarter than analysts expected. It also now expects its revenue for its full fiscal year to fall from year-earlier levels, rather than being roughly flat, because of pressures on demand.

The package delivery company pumps commerce around the world, and its signal for potentially weaker demand could dim the hope that’s fueled Wall Street’s recent rally: that the Federal Reserve can pull off a perfect landing for the economy by slowing it enough to stifle high inflation but not so much that it causes a recession.

Winnebago Industries also fell short of analysts’ profit expectations for the latest quarter. The maker of motorhomes and other recreational products said it sold fewer units than a year earlier because of “market conditions” and had to offer higher discounts. Its stock dropped 5.6%.

General Mills, which sells Progresso soup and Yoplait yogurt, reported stronger profit for the latest quarter than expected, but its revenue fell short as a recovery in its sales volume was slower than expected. The company said a key sales measure may now fall for its full fiscal year because of “a more cautious consumer economic outlook” and other factors. Its stock fell 3.6%.

Still, a pair of reports showed the U.S. economy may be in stronger overall shape than expected. Both confidence among consumers in December and sales of previously occupied homes in November improved more than economists had expected.

Encouraging signs that inflation is cooling globally also continue to pile up. In the United Kingdom, inflation in November unexpectedly slowed to 3.9% from October’s 4.6% rate, reaching its lowest level since 2021.

Easing rises in prices are raising hopes that central banks around the world can pivot in 2024 from their campaigns to hike interest rates sharply, which were meant to get inflation under control. For the Federal Reserve in particular, the general expectation is for its main interest rate to fall by at least 1.50 percentage points in 2024 from its current range of 5.25% to 5.50%, which is its highest level in more than two decades.

Treasury yields have been tumbling since late October on such hopes, and they fell again following the U.K. inflation report.

The yield on the 10-year Treasury dropped to 3.85% from 3.93% late Tuesday. It had been above 5% in October, at its highest level since 2007 and putting harsh downward pressure on the stock market.

Lower interest rates and yields not only help the economy grow by making borrowing less expensive, they also boost prices for investments and relax the pressure on the overall financial system. That has helped the S&P 500 to climb back within 2% of its record set nearly two years ago. Wall Street’s main benchmark index also just came off its seventh straight week of gains, its longest such streak in six years.

“The market pendulum has swung from extreme pessimism less than two months ago to extreme optimism,” said Mark Hackett, chief of investment research at Nationwide.

The strength and length of that rally raised criticism that stocks have simply rallied too much, with several strategists on Wall Street forecasting at least a pause in the short term.

It’s still not certain whether the Fed can pull off what was seen as a nearly impossible tightrope walk for the economy. And critics say the number of cuts to rates that Wall Street is forecasting for 2024 seems unlikely unless the economy falls into a recession, which would hurt corporate profits and thus stock prices.

Some officials from the Federal Reserve have also made recent comments saying it’s too early to consider a cut to rates in March, which is when traders largely expect them to begin, according to data from CME Group.

Wednesday’s losses in the stock market were widespread, and roughly 95% of companies within the S&P 500 dropped. All told, the S&P 500 fell 70.02 points to 4,698.35. The Dow dropped 475.92 to 37,082.00, and the Nasdaq sank 225.28 to 14,777.94.

In stock markets abroad, the FTSE 100 in London rose 1% following the encouraging U.K. inflation report. Indexes also rose across much of Asia, but stocks fell 1% in Shanghai after China kept its benchmark lending rates unchanged at the monthly fixing on Wednesday.


ASX 200 expected to open 73 points lower

The Australian share market looks set to open the day lower on Thursday following a bad night on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open 73 points or 1% lower.

Wall Street hit the brakes on its big rally Wednesday following disappointing profit reports from companies and warnings that the market had simply gone too far, too fast.

The S&P 500 slumped 1.5% for its worst loss since beginning a monster-sized rally shortly before Halloween. The Dow Jones Industrial Average dropped 475 points, or 1.3%, from its record high, while the Nasdaq composite sank 1.5%

Wednesday’s losses in the stock market were widespread, and roughly 95% of companies within the S&P 500 dropped. All told, the S&P 500 fell 70.02 points to 4,698.35. The Dow dropped 475.92 to 37,082.00, and the Nasdaq sank 225.28 to 14,777.94.

Market Watch

 

[bigdog]

Stock market today: Asian shares are mostly higher after a rebound on Wall Street

Shares are mostly higher in Asia after several strong profit reports helped Wall Street claw back most of its sharp loss from day before

qz.com

Wall Street bounces back after a big loss, and S&P 500 again nears record​

By Stan Choe,

Several strong profit reports helped Wall Street claw back most of its sharp loss from the prior day

Wall Street rebounded Thursday to claw back most of its sharp drop from the prior day, which was its first big step backward since a rally began in late October.

The S&P 500 climbed 1% and is back within 1% of its all-time high, a day after its worst tumble in nearly three months. The Dow Jones Industrial Average rose 322 points, or 0.9%, and came close to setting a record for the sixth time in the last seven days. The Nasdaq composite jumped 1.3%.

Micron Technology leaped 8.6% for one of the market's biggest gains after reporting stronger results for the latest quarter than analysts expected and saying it sees business conditions improving throughout its fiscal year.

CarMax rose 5.2% after it beat profit expectations despite what it called “persistent widespread pressures in the used car industry.” And cruise operator Carnival steamed 6.2% higher after reporting better quarterly results than expected.

The trio helped lead a widespread rally where more than 90% of the stocks within the S&P 500 climbed.

In the bond market, Treasury yields were mixed following a suite of reports on the economy. Mostly falling yields have been one of the main reasons the stock market has charged so high the last two months. They relax the pressure on the financial system, encourage borrowing and boost prices for investments.

After dipping in the morning, the yield on the 10-year Treasury edged up to 3.88% from 3.86% late Wednesday. In October, it had been above 5% and weighing heavily on markets.

Yields have been dropping on hopes that inflation has cooled enough for the Federal Reserve to not only halt its hikes to interest rates but to begin cutting them sharply next year. The Fed has hiked its main rate to the highest level in more than two decades, but officials released projections last week showing they see some cuts to rates coming in 2024.

Reports on Thursday painted a mixed picture of whether the Fed can indeed pull off the long-odds tightrope walk that everyone is hoping for: a slowdown in the economy powerful enough to conquer high inflation but not so strong that it causes a recession.

One report showed that slightly more U.S. workers applied for unemployment benefits last week, but the number was still below expectations and low relative to history. The hope at the Fed and on Wall Street is that the job market can cool by just the right amount so that it doesn't cause mass layoffs but also doesn’t add upward pressure on inflation.

Another report showed manufacturing in the mid-Atlantic region is weakening by more than expected. Manufacturing has been one of the hardest-hit areas of the economy. And a third report said the U.S. economy’s growth during the summer wasn’t quite as powerful as earlier estimated.

They “weren’t earth-shattering numbers, but they were still in line with the narrative that a cooling economy will keep the Fed on track to cut rates in the not-too-distant future,” according to Chris Larkin, managing director, trading and investing at E-Trade from Morgan Stanley.

“Right or wrong, that sentiment has played a big role in the market’s recent surge, even though the Fed has been doing its best to temper expectations.”

Wall Street has been ebullient about the possibilities for a slew of rate cuts and a resilient economy in 2024, which would both help buoy stock prices. The S&P 500 has charged 15% higher in roughly two months on anticipation for those twin supports, and the index is on track for an eighth straight week of gains.

That's despite Fed officials having penciled in far fewer rate cuts for 2024 than Wall Street. Critics say the number of rate cuts traders are expecting is unlikely unless the economy falls into a recession, which some still see as an inevitable consequence of all the rate hikes already instituted by the Federal Reserve.

That's raised criticism that stocks have gone too far, too fast and become too expensive relative to profits that companies are earning. Even before Wednesday's 1.5% drop for the S&P 500, several strategists on Wall Street were forecasting at least a pause in the rally in the short term.

On Thursday, the S&P 500 rose 48.40 points to claw back more than two thirds of that loss and closed at 4,746.75. The Dow gained 322.35 to 37,404.35, and the Nasdaq jumped 185.92 to 14,963.87.

In stock markets abroad, indexes were mostly lower in Europe and Asia. China was an exception, with stocks ticking 0.6% higher in Shanghai to trim its loss for the year by a bit. It’s one of the few markets globally that has not climbed sharply in 2023 amid hopes for easing inflation.

ASX 200 expected to edge higher 23 points​

The Australian share market looks set to end the week higher with a rebound on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open 23 points lower this morning.
Wall Street bounces back after a big loss, and S&P 500 again nears record

Several strong profit reports helped Wall Street claw back most of its sharp loss from the prior day

Wall Street rebounded Thursday to claw back most of its sharp drop from the prior day, which was its first big step backward since a rally began in late October.

On Thursday, the S&P 500 rose 48.40 points to claw back more than two thirds of that loss and closed at 4,746.75. The Dow gained 322.35 to 37,404.35, and the Nasdaq jumped 185.92 to 14,963.87.

The S&P 500 climbed 1% and is back within 1% of its all-time high, a day after its worst tumble in nearly three months. The Dow Jones Industrial Average rose 322 points, or 0.9%, and came close to setting a record for the sixth time in the last seven days. The Nasdaq composite jumped 1.3%.


Market Watch

 

[bigdog]

Stock market today: Wall Street ticks closer to record highs to cap its 8th straight winning week

Wall Street closed its eighth straight winning week with a quiet finish following reports showing inflation on the way down and the economy potentially on the way up.

apnews.com

Wall Street ticks closer to record highs to cap its 8th straight winning week​

By STAN CHOE

NEW YORK (AP) — Wall Street capped its eighth straight winning week with a quiet finish Friday, following reports showing inflation on the way down and the economy potentially on the way up.

The S&P 500 rose 0.2% to sit less than 1% below its record set nearly two years ago. The Dow Jones Industrial Average slipped 18 points, or less than 0.1%, and the Nasdaq composite edged 0.2% higher.

12 month comparison: 2023 2022

Bristol Myers Squibb helped lift the market and rose 2% after it said it will buy Karuna Therapeutics in a cash deal valued at a total of $14 billion. That helped offset an 11.8% slump for Nike, which cut its revenue forecast for its fiscal year and dragged sharply on the Dow. The athletic giant cited weakness in China, the downsides of a stronger U.S. dollar for exporters and other challenges.

But Wall Street’s focus was squarely on a suite of economic reports released Friday, which led to some swings in Treasury yields.

Falling yields have been a primary reason the stock market has charged roughly 15% higher since late October. Not only do they boost the economy by encouraging borrowing, they also relax the pressure on the financial system and goose prices for investments. They’ve been easing on hopes that inflation has cooled enough for the Federal Reserve to cut interest rates through 2024.

A report on Friday showed the measure of inflation the Federal Reserve prefers to use slowed by more than economists expected, down to 2.6% in November from 2.9% a month earlier. It echoed other inflation reports for November released earlier in the month.

“Inflation has fallen very quickly this year, especially in the last three to five months,” said Niladri “Neel” Mukherjee, chief investment officer of TIAA’s Wealth Management team. Over the next few months, “I think inflation will fade away in terms of top-of-mind items” as risks for financial markets.

Friday’s data also showed spending by U.S. consumers unexpectedly rose during the month. While that’s a good sign for growth for an economy driven mainly by consumer spending, it could also indicate underlying pressure remains on inflation.

“People are tightening their belts, but they’re not suffocating their spending,” said Brian Jacobsen, chief economist at Annex Wealth Management.

The Federal Reserve is walking a tightrope, trying to slow the economy enough through high interest rates to cool inflation, but not so much that it tips into a recession. A stronger-than-expected economy could complicate the balancing act.

Other reports on Friday showed orders for long-lasting manufactured goods strengthened more in November than expected, sales of new homes unexpectedly weakened and sentiment for U.S. consumers improved.

The yield on the 10-year Treasury was at 3.89%, roughly its same level from late Thursday. But it swerved a couple of times following the release of the reports. The 10-year yield is still down comfortably from October, when it was above 5% and putting painful downward pressure on the stock market.

Traders are largely betting the Federal Reserve will cut its main interest rate by at least 1.50 percentage points by the end of next year, according to data from CME Group. The federal funds rate is currently sitting within a range of 5.25% to 5.50% at its highest level in more than two decades.

The Federal Reserve released projections last week showing its typical policymaker expects to cut the federal funds rate several times next year, but likely by only half as much as what Wall Street is expecting.

Critics say Wall Street is too optimistic about how many rate cuts may come in 2024 and when they could begin. They warn the big run for stocks since late October on anticipation of such support may be overdone, or at the least pulling forward returns that would have happened in 2024.

With its eight straight weekly gains, the S&P 500 is in the midst of its longest winning streak since 2017.

Mukherjee of TIAA Wealth Management is relatively optimistic about the U.S. economy in coming years, particularly as artificial-intelligence technology helps reshape the world. But he sees the economy enduring at least a soft patch in the first half of 2024 as the effects of past rate hikes fully make their way through the system.

Plus, he sees the Federal Reserve more hesitant to cut rates than Wall Street expects.

“I think the market has run ahead of itself a little bit in pricing in six rate cuts,” he said. “Inflation is coming down very quickly, but this is a Fed which has been scarred once when they took the view that inflation was transitory back in 2021, and they overstayed their welcome at zero interest rates for longer than anyone though they would. They want to make sure they’re reasonably comfortable, quite comfortable with inflation somewhere in the vicinity of their target.”

All told, the S&P 500 rose 7.88 points to 4,754.63. The Dow slipped 18.38 to 37,385.97, and the Nasdaq gained 29.11 to 14,992.97.

In stock markets abroad, indexes were mixed in Europe and Asia.

Hong Kong’s Hang Seng dropped 1.7% after China released new regulations for online gaming. That sent stocks of Tencent, China’s largest gaming company, and rival NetEase down sharply.

 

[bigdog]

Stock market today: Asian shares power higher following slight gains on Wall Street

Asian shares have powered higher after Wall Street logged modest gains in this holiday-shortened week.

apnews.com

Wall Street drifts higher as a strong year for markets winds down​

By DAMIAN J. TROISE


NEW YORK (AP) — Wall Street drifted to a slightly higher close as trading remained light on this holiday-shortened week.

The subdued activity in the market with two trading days left in the year is capping off a broader rally to a strong finish. The S&P 500 is coming of its eight straight winning week and is hovering just below its all-time high set in January of 2022.

The S&P 500 rose 6.83 points, or 0.1%, to 4,781.58. It is up 24% for the year. The Dow Jones Industrial Average rose 111.19 points, or 0.3%, to close at 37,656.52.

The technology-heavy Nasdaq composite rose 24.60 points, or 0.2%, to 15,099.18. It has outpaced other major indexes with a gain of 44% this year.

“Consistent buying pressure of this magnitude is not only rare but a bullish sign for improving investor sentiment and market momentum,” said Adam Turnquist, chief technical strategist for LPL Financial, in a note to investors.

Health care stocks and a mix of retailers had some of the strongest gains. Eli Lilly rose 1.9% and Costco rose 1.1%.

U.S. crude oil prices fell 1.9% and weighed down energy stocks. Marathon Oil fell 1.2%.

Markets in Europe and Asia gained ground.

Bond yields fell significantly. The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.79% from 3.90% late Tuesday. Yields have been falling over hopes that inflation has cooled enough for the Federal Reserve to consider cutting interest rates in 2024.

Several biotechnology companies made big moves after giving investors updates on drug development. Cytokinetics surged 82.5% on an encouraging study update for a potential heart condition treatment. Iovance Biotherapeutics shed 18.7% after pausing a study on a potential lung cancer treatment because of a possible safety issue.

The New York Times rose 2.8% after filing a federal lawsuit against OpenAI and Microsoft over copyright infringement, seeking to end the practice of using its stories without permission to train chatbots.

The final week of 2023 lacks any big economic updates. Overall, investors have been encouraged by reports showing inflation is on the decline even as the economy appears stronger than expected. The Fed is walking a tightrope, seeking to slow the economy enough through high interest rates to cool inflation, but not so much that it tips the nation into recession.

Inflation slowed to a rate of 2.6% in November, according to a measure closely followed by the Fed. That’s down from 7.1% in the middle of 2022 and edging closer to the central bank’s target of 2% inflation. U.S. economic growth has been steady since contracting in the middle of 2022 and sharply accelerated in the third quarter of 2023.

The data have raised hopes that the economy will likely avoid a recession, or at least avoid a significant one. They have also encouraged Wall Street to bet that the Fed is done raising interest rates and will likely shift to rate cuts in the new year. The central bank has held rates steady since its meeting in July, and Wall Street expects it to start cutting rates as early as March.

ASX 200 expected to rise again​

The Australian share market looks set to open the day higher on Thursday where Wall Street drifted to a slightly higher close as trading remained light on this holiday-shortened week.

According to the latest SPI futures, the ASX 200 is expected to open 28 points or 0.4% higher this morning.
Wall Street drifted to a slightly higher close as trading remained light on this holiday-shortened week.

The subdued activity in the market with two trading days left in the year is capping off a broader rally to a strong finish. The S&P 500 is coming of its eight straight winning week and is hovering just below its all-time high set in January of 2022.

The S&P 500 rose 6.83 points, or 0.1%, to 4,781.58. It is up 24% for the year. The Dow Jones Industrial Average rose 111.19 points, or 0.3%, to close at 37,656.52.

The technology-heavy Nasdaq composite rose 24.60 points, or 0.2%, to 15,099.18. It has outpaced other major indexes with a gain of 44% this year.


Market Watch

 

[bigdog]

Stock market today: Asian stocks mixed in muted holiday trading as 2023 draws to a close

Asian shares are mixed in muted trading on the last trading day of the year. U.S. futures and oil prices edged higher.

apnews.com

Stocks waver in muted holiday trading on Wall Street​

By DAMIAN J. TROISE

Stocks drifted to a mixed finish in muted trading on Wall Street Thursday as markets approach the end of 2023.

The broader market remained mostly quiet ahead of the final trading day of the year, though every major index is on track for weekly gains.

The S&P 500 rose 1.77 points, or less than 0.1% to 4,783.35. It is on track for its ninth straight week of gains and is up more than 24% for the year. The two-month rally has also pushed the benchmark index closer to breaking its all-time high set in January of 2022.

The Dow Jones Industrial Average rose 53.58 points, or 0.1%, to 37,710.10.

The Nasdaq composite fell 4.04 points, or less than 0.1%, to 15,095.14. It has far outpaced the broader market this year and is on track to close 2023 with a gain of more than 44%.

Markets in Asia gained ground. Tokyo’s Nikkei 225 index was an outlier in Asia, shedding 0.4%. Speculation over whether and when the Bank of Japan might ease its longstanding lax monetary policy and raise its key interest rate from minus 0.1% has kept stocks wobbling in the world’s third-largest economy.

Markets in Europe fell.

There are few economic indicators out of Washington this week. The latest weekly report on unemployment benefits showed that applications rose last week, but not enough to raise concerns about the labor market or broader economy. The overall jobs market has been strong throughout 2023 and has been a driving force for the economy.

The average long-term U.S. mortgage rate retreated for the ninth straight week to its lowest level since May, according to mortgage buyer Freddie Mac. Mortgage rates have been easing since late October, along with long-term Treasury yields.

The yield on the 10-year Treasury surpassed 5.00% in October, but has also been generally falling since then. It rose to 3.84% on Thursday from 3.79% late Wednesday.

There was also a lack of big corporate news for investors.

Two higher-end models of the Apple Watch can go on sale again after a federal court temporarily lifted a sales halt ordered by the International Trade Commission due to a patent dispute. Apple rose 0.2%.

Technology and communication company stocks had some of the biggest gains. Chipmaker Advanced Micro Devices rose 1.8%

U.S. crude oil prices fell 3.2% and weighed down energy stocks. Hess fell 2.6%.

Companies are close to wrapping up their latest financial quarter and the next big batch of news will come when they start releasing those results later in January. Overall, companies in the S&P 500 have notched relatively strong profit gains after stumbling during the first half of 2023. That has given Wall Street more hope the economy will remain strong in 2024.

Analysts polled by FactSet expect companies in the S&P 500 to report earnings growth of 1.4% in the fourth quarter and say profit growth should accelerate next year.

Inflation has steadily eased since 2022 and should continue cooling into next year. The Federal Reserve’s preferred measure of inflation fell to 2.6% in November from a peak of 7.1% in 2022. That has helped improve forecasts for companies worried about inflation squeezing consumers and raising costs.

Economic data over the last few months have raised hopes that the economy can dodge a recession. Wall Street is betting that the Fed is done raising interest rates and will likely shift to rate cuts in the new year. The central bank has held rates steady since its meeting in July, and Wall Street expects it to start cutting rates as early as March.

ASX 200 expected to fall

The Australian share market looks set to end the year on a subdued note where stocks drifted to a mixed finish in muted trading on Wall Street Thursday as markets approach the end of 2023.

According to the latest SPI futures, the ASX 200 is expected to open 33 points or 0.5% lower this morning.

The S&P 500 rose 1.77 points, or less than 0.1% to 4,783.35. It is on track for its ninth straight week of gains and is up more than 24% for the year. The two-month rally has also pushed the benchmark index closer to breaking its all-time high set in January of 2022.

The Dow Jones Industrial Average rose 53.58 points, or 0.1%, to 37,710.10.

The Nasdaq composite fell 4.04 points, or less than 0.1%, to 15,095.14. It has far outpaced the broader market this year and is on track to close 2023 with a gain of more than 44%


Market Watch

 

[bigdog]

Merry Christmas and a happy new year to all ASF members

Stock market today: Asian markets mostly slip on the first trading day of 2024

Asian markets opened the year on a downward trend after Wall Street benchmarks ticked lower on the last trading day of 2023.

apnews.com

Stocks end 2023 up 20% for the year as resilient economy energizes investors​

By DAMIAN J. TROISE

NEW YORK (AP) — The S&P 500 closed out 2023 with a gain of more than 24% and the Dow finished near a record high, as easing inflation, a resilient economy and the prospect of lower interest rates buoyed investors, particularly in the last two months of the year.

Stocks closed Friday with modest losses.

The S&P 500 slipped 13.52 points, or 0.3%, to 4,769.83. That is still just 0.6% shy of an all-time high set in January of 2022 and it still left the benchmark index with a rare ninth consecutive week of gains.

The Dow Jones Industrial Average fell 20.56 points, or 0.1%, to 37,689 after setting a record Thursday.

The Nasdaq slipped 83.78 points, or 0.6%, to 15,011.35, but that was barely a blemish on an annual gain of more than 43%, its best performance since 2020.

The broader market’s gains were driven largely by the so-called Magnificent 7 companies, which include Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla. They accounted for about two-thirds of the gains in the S&P 500 this year, according to S&P Dow Jones Indices. Nvidia lead the group with a gain of about 239%.

Most major indexes were able to erase their losses from a dismal 2022. Smaller company stocks had a late rally, but managed to erase the bulk of their losses from last year. The Russell 2000 index finished 2023 with a 15.1% gain after falling 21.6% in 2022.

The rally that started in November helped broaden the gains within the market beyond just the big technology companies. It marked a big psychological shift for investors, said Quincy Krosby, chief global strategist at LPL Financial.

“Investors were able to accept that fact that the market would close the year on a higher note,” Krosby said. “Above all else, it was broad participation in the market that reinforced and confirmed gains for smaller company stocks were particularly important.”

Shares in European markets edged higher Friday, also after a year of gains. Benchmark indexes in France and Germany made double-digit advances, while Britain’s has climbed just under 4%.

Asian markets had a mixed session on the last trading day of the year for most markets. Tokyo’s Nikkei 225 gave up 0.2% to 33,464.17. It gained 27% in 2023, its best year in a decade as the Japanese central bank inched toward ending its longstanding ultra-lax monetary policy after inflation finally exceeded its target of about 2%.

The Hang Seng index in Hong Kong ended flat, while the Shanghai Composite index gained 0.7%. The Shanghai index lost about 3% this year and the Hang Seng fell nearly 14%. Weakness in the property sector and in global demand for China’s exports, as well as high debt levels and wavering consumer confidence have weighed on the country’s economy and the stock market.

Investors in the U.S. came into the year expecting inflation to ease further as the Federal Reserve pushed interest rates higher. The trade-off would be a weaker economy and possibly a recession. But while inflation has come down to around 3%, the economy has chugged along thanks to solid consumer spending and a healthy job market.

The stock market is now betting the Fed can achieve a “soft landing,” where the economy slows just enough to snuff out high inflation, but not so much that it falls into a recession. As a result, investors now expect the Fed to begin cutting rates as early as March.

The Fed has signaled three quarter-point cuts to the benchmark rate next year. That rate is currently sitting at its highest level, between 5.25% and 5.50%, in two decades.

That could add more fuel to the broader market’s momentum in 2024. High interest rates and Treasury yields hurt prices for investments, so a continued reversal means more relief from that pressure. Wall Street is forecasting stronger earnings growth for companies next year after a largely lackluster 2023, with companies wrestling with higher input and labor costs and a shift in consumer spending.

Bond market investors appeared headed for a third losing year in a row until things turned around starting in late October. Excitement about potential cuts to interest rates sent bond prices soaring and yields dropping. The yield on the 10-year Treasury, which hit 5% in October, stood at 3.88% Friday, up from 3.85% on Thursday.

The yield on The two-year Treasury, which more closely tracks expectations for the Fed, fell to 4.25% from 4.28% from late Thursday. It also surpassed 5% in October.

U.S. and international crude oil prices were relatively stable on Friday. The price of oil tumbled by more than 10% this year, defying predictions from some experts that it could cross $100 per barrel.

Despite production cuts from OPEC, a war involving energy exporter Russia and another in the Middle East, U.S. benchmark crude dropped nearly 11% in 2023, and a whopping 21% in the final three months of the year.

Increased production in the U.S., now the top oil producer in the world, as well as Canada, Brazil and Guyana offset the reduced output from OPEC. Not all OPEC members participated in the cuts and some countries like Iran and Venezuela are pumping more oil, energy analysts say.

 

[bigdog]

ASX 200 expected to open flat​

The Australian share market looks set for a subdued session on Tuesday following a poor session on Wall Street on Friday.

According to the latest SPI futures, the ASX 200 is expected to open the day flat this morning.

On Wall Street, the Dow Jones was down 0.05%, the S&P 500 fell 0.3%, and the Nasdaq dropped 0.55%.

 

[bigdog]

Stock market today: Asian markets track Wall Street's decline, eroding last year's gains

Asian shares have dropped after Wall Street started 2024 with a slump, giving back some of its big gains from last year.

apnews.com

Wall Street slumps to start 2024 and gives back some of last year’s big gains​

By STAN CHOE

A weak start to 2024 had Wall Street on Tuesday giving back a bit of its powerful gains from the year before.

The S&P 500 slipped 27.00 points, or 0.6%, to 4,742.83 after coming into the year at the brink of its all-time high. The Dow Jones Industrial Average edged up 25.50, or 0.1%, to 37,715.04, and the Nasdaq composite led the market lower with a drop of 245.41, or 1.6%, to 14,765.94.

Some of the market’s sharper drops came from stocks that were last year’s biggest winners. Apple lost 3.6% for its worst day in nearly five months, and Nvidia and Meta Platforms both fell more than 2%. Tesla, another member of the “Magnificent 7” Big Tech stocks that drove well over half of Wall Street’s returns last year, swung between losses and gains after reporting its deliveries and production for the end of 2024. It ended the day down by less than 0.1%.

Netherlands-based ASML sank after the Dutch government partially revoked a license to ship some products to customers in China. The United States has been pushing for restrictions on exports of chip technology to China. ASML’s U.S.-listed shares fell 5.3%, and U.S. chip stocks also weakened.
Health care stocks held up better after Wall Street analysts upgraded ratings on a few, including a 13.1% jump for Moderna. Amgen’s 3.3% gain and UnitedHealth Group’s 2.4% climb were two of the strongest forces lifting the Dow.

Much of Wall Street had been preparing for at least a pause in the big rally that carried the S&P 500 to nine straight winning weeks and within 0.6% of its record set almost exactly two years ago. That big surge came on hopes the Federal Reserve may have engineered a perfect escape from high inflation: one where high interest rates slow the economy enough to cool inflation but not so much that they cause a painful recession.

Now, the hope is that the Fed will shift sharply in 2024 and cut interest rates several times. Cuts can relax the pressure on the economy and boost prices for investments. But even though such hopes are high, it’s still not assured. And prices for stocks and bonds have already rallied hard on expectations for them.

At Deutsche Bank, the main expectation among economists is for the Federal Reserve to cut its main interest rate by 1.75 percentage points this year, from its current range of 5.25% to 5.50%. That’s a shade more than the majority of traders on Wall Street are betting.

But the Deutsche Bank economists led by Matthew Luzzetti also expect a mild recession to weaken the job market more than the Federal Reserve and much of Wall Street expect. That’s partially because the Deutsche Bank economists expect the Fed to “be adamant to not repeat the mistakes of the 1970s, namely avoiding cutting rates prematurely.”

That would give more time for the rate hikes already instituted by the Fed to fully work their way through the system and grind down the economy. The Fed’s main interest rate is at its highest level in decades, up from virtually zero two years ago.

A report on Tuesday showed that the U.S. manufacturing industry may be weaker than thought. It contracted by more last month than an earlier, preliminary reading indicated, according to S&P Global, as new sales dropped because of weakness both abroad and at home. Business confidence, though, did pick up to a three-month high.

A separate report showed that growth in construction spending slowed by a touch more in November than economists expected.

Like stocks, Treasury yields in the bond market also regressed a bit on Tuesday following their big moves since autumn. The yield on the 10-year Treasury rose to 3.94% from 3.87% late Friday.

More high-profile reports on the economy will arrive later this week. On Wednesday, the Federal Reserve will release the minutes from its last policy meeting, one that sparked hopes for a series of rate cuts coming this year.

Another report on Wednesday will show how many job openings U.S. employers were advertising at the end of November, data that the Federal Reserve follows closely. Friday will bring the U.S. government’s monthly tally of job growth across the country.

In stock markets abroad, indexes fell 1.5% in Hong Kong and 0.4% in Shanghai amid worries about the Chinese manufacturing and property sectors.

South Korea’s Kospi gained 0.5%, and indexes were mixed across much of Europe. Japan’s markets were closed for a holiday.

ASX 200 expected to sink​

The Australian share market looks set for a difficult session on Wednesday following a poor night on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open the day 77 points or 1.0% lower.

A weak start to 2024 had Wall Street on Tuesday giving back a bit of its powerful gains from the year before.

The S&P 500 slipped 27.00 points, or 0.6%, to 4,742.83 after coming into the year at the brink of its all-time high. The Dow Jones Industrial Average edged up 25.50, or 0.1%, to 37,715.04, and the Nasdaq composite led the market lower with a drop of 245.41, or 1.6%, to 14,765.94.


Market Watch

 

[Garpal Gumnut]

Indeed, @bigdog, some cold water to wipe off the sudden blood which was overdue.

Quite a startle when it comes, but not a surprise.

Hide but don't deny reality. What an interesting week.

gg

 

[bigdog]

YESTERDAY AN ALL RED DAY

Stock market today: Wall Street slumps as its weak start to 2024 carries into another day

Stocks fell again as Wall Street’s slow start to 2024 carried into a second day. The S&P 500 lost 0.8% Wednesday, though it remains within 2% of its record.

apnews.com

Wall Street slumps as its weak start to 2024 carries into another day​

By STAN CHOE
Updated 8:19 AM GMT+11, January 4, 2024

NEW YORK (AP) — Stocks fell again Wednesday as Wall Street’s slow start to the year stretched into a second day.

The S&P 500 lost 38.02, or 0.8%, to 4,704.81, though it remains within 2% of its record set exactly two years ago. The Dow Jones Industrial Average dropped 284.85 points, or 0.8%, from its own record to 37,430.19. The Nasdaq composite led the market lower with a drop of 173.73, or 1.2%, to 14,592.21.

Some of last year’s biggest winners again gave back some of their gains to weigh on the market. Tesla fell 4% after more than doubling last year, for example. It and the other six “Magnificent 7” Big Tech stocks responsible for the majority of Wall Street’s returns last year have regressed some following their tremendous runs.

The question hanging over the market is whether all the enthusiasm that sent stocks broadly rallying for nine straight weeks into the start of this year was warranted. It was built on expectations that inflation has cooled enough for the Federal Reserve to not only halt its hikes to interest rates but to cut them several times this year. Hopes are also high the economy can escape a recession, even after the Fed hiked its main interest rate to the highest level since 2001.

A couple of reports released Wednesday morning indicated the overall economy may indeed be slowing from its strong growth last summer, which the Federal Reserve hopes will keep a lid on inflation. A big danger is if it slows too much and begins shrinking.

One report showed U.S. employers were advertising nearly 8.8 million job openings at the end of November, down slightly from the month before and the lowest number since early 2021. The report also showed slightly fewer workers quit their jobs during November.

The Fed is looking for exactly such a cooldown, which it hopes will limit upward pressure on inflation without necessitating widespread layoffs across the economy.

“These data will be welcome news for policymakers,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics.

A second report from the Institute for Supply Management showed the U.S. manufacturing industry is improving by a touch more than economists expected, but it’s still contracting. Manufacturing has been one of the hardest-hit areas of the economy recently, while the job market and spending by U.S. households have remained resilient.

Treasury yields slumped immediately after the reports and then yo-yoed though the day. The yield on the 10-year Treasury eventually slipped to 3.91% from 3.94% late Tuesday. It’s been generally falling since topping 5% in October, when it was putting strong downward pressure on the stock market.

In the afternoon, yields swung again after the Federal Reserve released the minutes from its latest policy meeting. It was at that meeting in December that policy makers hinted their dramatic campaign to hike interest rates to get inflation under control may be over. They also released projections showing their median official expects the federal funds rate to fall by 0.75 percentage points through 2024.

The minutes from the meeting revealed “almost all participants” indicated a drop in rates this year would likely be appropriate. But they also said their forecasts were hampered by an “unusually elevated degree of uncertainty.” A reacceleration of inflation, which is still a possibility, could push them to actually raise rates further.

Fed officials also noted in their meeting how stock prices have rallied recently and Treasury yields have eased. Such conditions can rev up the economy and add upward pressure on inflation.

While the Fed doesn’t like that, “the worst they’ll do is push out the date when they first cut,” said Brian Jacobsen, chief economist at Annex Wealth Management.

Traders are largely betting the first cut to rates could happen in March, and they’re putting a high probability on the Fed cutting its main interest rate by least 1.50 percentage points through the year, according to data from CME Group. The federal funds rate is currently sitting within a range of 5.25% to 5.50%.

Critics say that’s likely too bold a prediction. “The only way the Fed will cut more than four times in 2024 is if the economy is skidding out of control” into a recession, Jacobsen said.

Even if the Federal Reserve pulls off a perfect landing to shimmy away from high inflation without causing an economic downturn, some critics also say the stock market has simply run too far, too fast in recent months and is due for at least a pause in its run.

In stock markets abroad, indexes fell across much of Europe and Asia. Losses were particularly sharp in France, where the CAC 40 fell 1.6%, and in South Korea, where the Kospi sank 2.3%. Stocks in Shanghai were an outlier, rising 0.2%.

ASX 200 expected to fall again​

The Australian share market looks set for another difficult session on Wednesday following a poor night of trade on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open the day 19 points or 0.2% lower this morning.
NEW YORK (AP) — Stocks fell again Wednesday as Wall Street’s slow start to the year stretched into a second day.

The S&P 500 lost 38.02, or 0.8%, to 4,704.81, though it remains within 2% of its record set exactly two years ago. The Dow Jones Industrial Average dropped 284.85 points, or 0.8%, from its own record to 37,430.19. The Nasdaq composite led the market lower with a drop of 173.73, or 1.2%, to 14,592.21.

Market Watch

 

[bigdog]

Stock market today: Asian shares trade mixed, mirroring Wall Street finish

Asian shares are mixed, mirroring the finish on Wall Street, although export-related Tokyo stocks got a boost from a strengthening dollar.

apnews.com

Wall Street ends mixed, and yields rise after solid data on the economy​

By STAN CHOE

NEW YORK (AP) — Wall Street’s weak start to 2024 carried into a third day, and stocks finished mixed on Thursday following reports showing the U.S. job market remains solid, though maybe a touch too strong.

The S&P 500 slipped 16.13, or 0.3%, to 4,688.68 and is on track for its first losing week in the last 10. The Dow Jones Industrial Average eked out a gain of 10.15 points, or less than 0.1%, to 37,440.34, and the Nasdaq composite fell 81.91, or 0.6%, to 14,510.30.

Walgreens Boots Alliance sank 5.1% after it nearly halved its dividend so it could hold onto more cash. That helped overshadow gains for airlines and cruise-ship operators, which recovered some of their sharp losses from earlier in the week. Carnival steamed 3.1% higher, and United Airlines got a 2.4% lift.

U.S. stocks have broadly regressed this week after rallying into the end of last year toward record heights. Critics said the market was due for at least a breather following its big run, which fed on hopes inflation has cooled enough for the Federal Reserve to cut interest rates sharply this year.

Rate cuts give a boost to prices for stocks and other investments, while also relaxing the pressure on the economy and financial system. Treasury yields in the bond market have already eased since autumn on expectations for such cuts, releasing pressure on the stock market.

But Treasury yields rose Thursday following reports showing the job market may be stronger than expected. The economy is in a delicate phase where investors want it to remain solid, but not too hot.

A healthy job market is of course good for workers and stamps out worries about an imminent recession. But too much strength could prod the Federal Reserve to keep interest rates high because it could keep upward pressure on inflation. And the Fed has already hiked its main interest rate to the highest level since 2001.

One report from the U.S. government on Thursday showed fewer U.S. workers filed for unemployment benefits last week than expected. Another from ADP Research Institute said private employers accelerated their hiring last month by more than economists expected.

A more comprehensive report on the jobs market from the U.S. Labor Department will arrive on Friday. Economists expect that to show U.S. hiring slowed to 160,000 jobs last month from 199,000 in November.

“If tomorrow’s numbers show the same kind of strength and the economy keeps rolling along, it’s fair to wonder why the Fed would be in a rush to cut rates,” said Chris Larkin, managing director, trading and investing at E-Trade from Morgan Stanley.

Traders are betting the Federal Reserve will cut interest rates by twice as much this year as the central bank has indicated. Wall Street is also thinking the first cut could come as soon as March, and a stronger-than-expected economy makes such predictions less realistic. Critics had already called them overly aggressive.

A third report from S&P Global said that growth for financial businesses and others in U.S. services industries was a touch stronger last month than expected.

Following Thursday’s data reports, the yield on the 10-year Treasury rose to 3.99% from 3.91% late Wednesday. The yield on the two-year Treasury, which more closely tracks expectations for the Fed, climbed to 4.39% from 4.33%.

Stocks have already rallied in part on expectations for sharp cuts coming to interest rates soon. If the Fed doesn’t cut as deeply and as quickly as expected, prices for stocks and other investments could be in jeopardy.

On Wall Street, Peloton Interactive jumped 13.9% after it announced a partnership to bring its workout content to TikTok.

APA fell 7.3% after it said it will buy Callon Petroleum in an all-stock deal valued at roughly $4.5 billion, including debt. Callon Petroleum gained 2.9%.

In stock markets abroad, indexes were modestly higher in much of Europe and a bit lower in much of Asia.

In Tokyo, the mood was somber as the market reopened from the New Year holidays with a moment of silence after a major earthquake Monday left at least 77 people dead and dozens missing.

ASX 200 expected to rebound​

The Australian share market looks set to end the week on a positive note despite a mixed night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 21 points or 0.3% higher this morning.

Wall Street’s weak start to 2024 carried into a third day, and stocks finished mixed on Thursday following reports showing the U.S. job market remains solid, though maybe a touch too strong.

The S&P 500 slipped 16.13, or 0.3%, to 4,688.68 and is on track for its first losing week in the last 10. The Dow Jones Industrial Average eked out a gain of 10.15 points, or less than 0.1%, to 37,440.34, and the Nasdaq composite fell 81.91, or 0.6%, to 14,510.30.


Market Watch

 

[bigdog]

Stock market today: Wall Street shaves off some losses to close its worst week in the last 10

Wall Street ended a listless day with slight gains after reports showed workers are getting bigger raises, but also that key parts of the economy still don’t look like they’re overheating.

apnews.com

Wall Street shaves off some losses to close its worst week in the last 10​

By STAN CHOE

NEW YORK (AP) — Wall Street closed its worst week since Halloween with a listless Friday after reports showed workers are getting bigger raises, but key parts of the economy still don’t look like they’re overheating.

The S&P 500 rose 8.56 points, or 0.2%, to 4,697.24 after drifting between small gains and losses through the day. It capped the first down week for the index in the last 10, after it roared into 2024 on hopes that inflation and the overall economy are cooling enough for the Federal Reserve to cut interest rates sharply through the year.

The Dow Jones Industrial Average rose 25.77, or 0.1%, to 37.466.11 and inched closer to its record set earlier in the week. The Nasdaq composite added 13.77, or 0.1%, to 14,524.07.

Treasury yields swung sharply in the bond market following the economic reports. They initially climbed after the latest monthly jobs report showed U.S. employers unexpectedly accelerated their hiring last month. Average hourly pay for workers also rose, when economists had been forecasting a dip.

Such strong numbers are good news for workers, and they should keep the economy humming. That’s a positive for corporate profits, which are one of the main factors that set prices for stocks.

But Wall Street’s worry is the strong data could also convince the Federal Reserve upward pressure remains on inflation. That in turn could mean the Fed will hold interest rates high for longer than expected. Interest rates affect the other big factor setting stock prices, with high ones hurting financial markets.

The jobs report briefly forced traders to push out their forecasts for when the Fed could begin to cut rates. But a report later in the morning showed that growth for finance, real estate and other companies in the U.S. services industries slowed by more than economists expected last month.

Following that report, traders quickly built bets back up for the Fed to begin cutting rates in March. They’re now forecasting a nearly two-in-three chance of that, similar to a day earlier, according to data from CME Group.

Altogether, the data could bolster Wall Street’s building hopes for a perfect landing for the economy, one where it slows just enough through high interest rates to stamp out high inflation but not so much that it causes a recession.

After climbing as high as 4.09% immediately after the jobs report, the yield on the 10-year Treasury fell to back to 3.96% following the weaker-than-expected report on services industries. It eventually pulled back to 4.04%, compared with 4.00% late Thursday.

On Wall Street, Constellation Brands climbed 2.1% after the seller of Corona and Modelo beers in the United States reported stronger profit for the latest quarter than analysts expected.

Travel-related companies were also strong and clawing back more of their losses from earlier in the week. Carnival rose 2.8%, and American Airlines gained 3.9%.

On the losing end was Apple, whose 0.4% dip Friday sent it to a 5.9% loss for the week, its worst since September. It’s a sharp turnaround from last year, when the market’s most influential stock soared more than 48%.

This week’s broad pullback for stocks was not a surprise for many on Wall Street, who had been calling its big run since autumn overdone. Critics say the six rate cuts traders are betting on for 2024 is unlikely unless a recession occurs. The Fed itself indicated in its latest summary of economic projections, or SEP, that three cuts may be more likely.

“Many who assume that the Fed will need to move faster and more aggressively than its SEP projections or recent statements likely received a dose of reality this week,” said Rick Rieder, chief investment officer of global fixed income at BlackRock. “Things are cooling, but in a more moderate way than historically, similarly to the weather these days. There are spurts of faster cooling in some areas, but generally nothing that people should panic about, or aggressively seek shelter from.”

In stock markets abroad, indexes were mostly lower in Europe after data showed showed inflation rose to 2.9% in December. The rebound after seven monthly declines fueled debate over how soon the European Central Bank could cut its own interest rates.

Indexes were also lower across much of Asia. Japan’s Nikkei 225 was an exception and rose 0.3%.

Japanese exporters are betting a boost from the falling value of the yen against other currencies. The yen has weakened in recent days amid speculation the Bank of Japan might go slowly on changing its ultra-aggressive policy on interest rates following Monday’s major earthquake in central Japan.

 

[bigdog]

ASX 200 expected to fall

The Australian share market looks set for a subdued session on Monday despite a positive finish on Wall Street on Friday.

According to the latest SPI futures, the ASX 200 is expected to open the day 3 points lower this morning.

Wall Street closed its worst week since Halloween with a listless Friday after reports showed workers are getting bigger raises, but key parts of the economy still don’t look like they’re overheating.

The S&P 500 rose 8.56 points, or 0.2%, to 4,697.24 after drifting between small gains and losses through the day. It capped the first down week for the index in the last 10, after it roared into 2024 on hopes that inflation and the overall economy are cooling enough for the Federal Reserve to cut interest rates sharply through the year.

The Dow Jones Industrial Average rose 25.77, or 0.1%, to 37.466.11 and inched closer to its record set earlier in the week. The Nasdaq composite added 13.77, or 0.1%, to 14,524.07.

 

[bigdog]

https://www.washingtonpost.com/business/2024/01/07/stock-market-rates-jobs-china/888507a4-addf-11ee-9a32-5c9e6aa28b3b_story.html

Wall Street rallies near record heights as Big Tech stocks recover; oil tumbles​

By Stan Choe 
Wall Street rallied Monday to claw back almost all the losses from its slow start to the year.

The S&P 500 jumped 1.4% to pull within 0.7% of its all-time high set two years ago. It’s a return of momentum for Wall Street’s main measure of health, which was coming off its first losing week in the last 10.

The Nasdaq composite shot 2.2% higher for its best day in eight weeks, and the Dow Jones Industrial Average lagged the market with a more modest gain of 0.6%, or 216 points.

Boeing dragged on the Dow in its first trading after one of its jets suffered an inflight blowout over Oregon. It fell 8%. Spirit AeroSystems, which builds fuselages and other parts for Boeing, lost 11.1%.

Stocks of oil-and-gas companies were also heavy weights after Saudi Arabia gave indications of potentially weak demand for crude. Exxon Mobil fell 1.7%, and Marathon Oil lost 2.7% as a barrel of U.S. crude tumbled $3.04 to $70.77.

But the rest of Wall Street largely climbed as easing Treasury yields relaxed the pressure on the stock market.

Big Tech stocks led the way. They were the main reason for Wall Street’s big gains last year, when excitement around artificial-intelligence technology made just a handful responsible for most of the S&P 500’s returns. But they stumbled last week as markets broadly regressed.

Nvidia rose 6.4% after announcing several AI-related products. Apple, meanwhile, rose 2.4% to bounce back from its worst week since September. They were the strongest forces lifting the S&P 500, along with Microsoft, Amazon and Alphabet.

Commercial Metals also jumped 7.5% after reporting stronger profit for the latest quarter than analysts expected. It said construction activity is healthy in North America, driving demand for steel and helping to offset weaker conditions in Europe.

More earnings results will be arriving at the end of the week. Delta Air Lines, JPMorgan Chase and UnitedHealth Group will be among the companies kicking off the S&P 500’s reporting season on Friday for the final three months of 2023.

The highlight of the week may be Thursday’s release of the latest inflation data for U.S. consumers. A cooldown there has ignited hope on Wall Street that the Federal Reserve will soon see enough improvement to not only halt its hikes to interest rates but to begin cutting them.

The Fed has already hiked its main interest rate to the highest level since 2001, which grinds down on the economy and hurts prices for investments, in hopes of conquering high inflation. The Fed said last month it’s seen improvement, and Wall Street’s expectation is for it start cutting rates as soon as March.

Treasury yields have already sunk in the bond market on such expectations, and they edged lower Monday. The yield on the 10-year Treasury fell to 4.01% from 4.05% late Friday. It was above 5% in October, at its highest point since 2007 and putting sharp downward pressure on the stock market.

The powerful resulting rally for stocks has caused some on Wall Street to say at least a pause is likely in the near term. The market looks “extremely expensive,” according to Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management.

Critics also warn traders may be too optimistic about how deeply the Federal Reserve may cut rates this year. The Fed has indicated a potential for three cuts, but many traders are anticipating at least six. That large a number may not be likely unless a recession forces the Fed’s hand, critics say.

That’s why much focus is on corporate profits, where growth could help prop up stock prices.

Analysts expect companies in the S&P 500 to report growth of 1.3% in earnings per share for the fourth quarter of 2023, according to FactSet. That’s a relatively meager number, but it would mark just a second straight quarter of growth.

Helen of Troy, the company behind such brands as Hydro Flask, Osprey and Drybar, rose 4.5% after reporting stronger profit for its latest quarter than analysts expected. Incoming CEO Noel Geoffroy said the company did better than it had expected despite “what continues to be a challenging macro consumer environment.”

Elsewhere on Wall Street, some of the fallout from the weekend’s blowout of a Boeing jet flown by Alaska Airlines waned through the day. Alaska Air Group ended just 0.2% lower after falling sharply earlier. United Airlines, which flies the same Boeing model and also had to cancel flights due to its grounding, opened lower but finished with a gain of 2.8%.

All told, the S&P 500 rose 66.30 points to 4,763.54. The Dow gained 216.90 to 37,683.01, and the Nasdaq jumped 319.70 to 14,843.77.

In stock markets abroad, indexes were mixed. Hong Kong’s Hang Seng sank 1.9%, led by losses for property and technology shares, while stocks fell 1.4% in Shanghai.

Property shares tumbled after Zhongzhi Enterprise Group, a major lender to real estate developers, filed for bankruptcy in Beijing. China also announced sanctions Sunday against five American defense-related companies in response to U.S. arms sales to Taiwan and U.S sanctions on Chinese companies and individuals.

ASX 200 expected to surge​

The Australian share market is expected to rebound strongly on Tuesday following a very positive start to the week on Wall Street.

According to the latest SPI futures, the ASX 200 is poised to open the day 82 points or 1.1% higher.

Wall Street rallied Monday to claw back almost all the losses from its slow start to the year.

The S&P 500 jumped 1.4% to pull within 0.7% of its all-time high set two years ago. It’s a return of momentum for Wall Street’s main measure of health, which was coming off its first losing week in the last 10.

The Nasdaq composite shot 2.2% higher for its best day in eight weeks, and the Dow Jones Industrial Average lagged the market with a more modest gain of 0.6%, or 216 points.

All told, the S&P 500 rose 66.30 points to 4,763.54. The Dow gained 216.90 to 37,683.01, and the Nasdaq jumped 319.70 to 14,843.77.


Market Watch

 

[UMike]

Bit cion's just Banging eh?

 

[bigdog]

Stock market today: Asian shares retreat after a lackluster day on Wall St, but Tokyo jumps 2%

Asian shares have retreated after a lackluster session on Wall Street, though Tokyo broke ranks, gaining more than 2% after the government said it would double its disaster reserves by nearly $7 billion.

apnews.com

Wall Street drifts in mixed trading as oil recovers some of its losses​

By STAN CHOE

NEW YORK (AP) — Wall Street drifted through a quiet day of mixed trading Tuesday, where most stocks fell but a handful of influential companies kept the losses in check.

The S&P 500 slipped 7.04 points, or 0.1%, to 4,756.50 to follow up its best day in nearly two months. The Dow Jones Industrial Average fell 157.85, or 0.4%, to 37,525.16, and the Nasdaq composite rose 13.94, or 0.1%, to 14,857.71.

Eversource Energy tumbled 7.7% for one of the worst losses in the S&P 500 after it said it could face a hit of up to $1.6 billion against its results for the end of 2023. It’s negotiating the sale of its stake in three offshore wind projects, and it may need to account for a lower value for them due to several challenges.

Unity Software fell 8% after it said it will cut about a quarter of its workforce, or 1,800 positions.

Boeing also fell again, but not by as much as Monday, the first trading day after one of its jets flying for Alaska Airlines suffered an in-flight blowout over Oregon. Its stock lost 1.4% after tumbling 8% Monday. Spirit AeroSystems, which makes fuselages and other parts for Boeing, slipped 0.4%.

Elsewhere in the airline industry, JetBlue Airways lost 10.2% after its chief executive, Robin Hayes, said he will step down for health reasons. He will be replaced by JetBlue’s current president, Joanna Geraghty, who will become the first woman to lead a major U.S. airline.

On the winning side of Wall Street, Illumina gained 4.5% after the biotechnology company said it expects to report stronger revenue for the end of 2023 than analysts had forecast. Urban Outfitters jumped 7.7% after it said total sales at its stores, including Anthropologie, strengthened by 10% during the final two months of the year from 2022 levels.

Nvidia, meanwhile, rose 1.7% to set an all-time high for a second straight day. It’s been riding a wave of excitement that its chips will stay in huge demand thanks to the boom around artificial-intelligence technology. And as one of Wall Street’s largest stocks, its movements carry more weight on the S&P 500 and other indexes than almost any other company.

A 1.5% gain for Amazon, another one of Wall Street’s titans, also helped to limit the losses for the S&P 500, even though seven out of 10 stocks in the index fell.

Financial markets have had a slow start to the year after roaring into the end of 2023. The S&P 500 had leaped to nine straight winning weeks to close out the year, mostly on rising hope that the U.S. economy will remain resilient and the Federal Reserve will cut interest rates sharply through 2024.

Some mixed data recently has bolstered criticism saying Wall Street may have gotten too optimistic about the number of rate cuts coming.

The Federal Reserve has already raised its main interest rate to the highest level since 2001, hoping to grind down the economy and investment prices to get inflation under control. With inflation down considerably from its peak, the Fed has indicated it may cut rates three times through 2024. That would give investment prices a boost and relax the pressure on the economy and financial system.

But traders are still betting on a better than 50% probability for at least six cuts, or double the Fed’s projection, according to data from CME Group. Critics say such a high number is unlikely unless the economy falls into a recession.

Treasury yields have already slid on anticipation of rate cuts, and they were holding relatively steady on Tuesday. The yield on the 10-year Treasury edged up to 4.02% from 4.01% late Monday.

In the oil market, crude prices clawed back some of their sharp losses from the day before, when Saudi Arabia made moves hinting at weakening demand. A barrel of benchmark U.S. crude rose $1.47 to $72.24. Brent crude, the international standard, gained $1.47 to $77.59.

This week’s headline events for Wall Street are likely to come toward the end of it. On Thursday, the U.S. government will give its latest monthly update on inflation at the consumer level. Continued progress there could show whether Wall Street’s hopes for rate cuts are justified or fanciful.

With expectations so strong for deeper cuts to rates than the Fed is suggesting, “incoming inflation data would need to continue to surprise for the Fed to cut as soon as March,” according to economists at Deutsche Bank.

On Friday, big companies in the S&P 500 will begin reporting their results for the final three months of 2023. The broad expectation is for companies in the index to report modest growth in earnings per share from a year earlier.

In stock markets abroad, Japan’s Nikkei 225 rose 1.2% to notch its highest close since 1990. Indexes elsewhere had more modest moves, with many edging lower.

ASX 200 expected to edge lower​

The Australian share market looks set for a subdued session on Wednesday following a mixed night on Wall Street.

According to the latest SPI futures, the ASX 200 is expected to open the day 12 points or 0.14% lower.

Wall Street drifted through a quiet day of mixed trading Tuesday, where most stocks fell but a handful of influential companies kept the losses in check.

The S&P 500 slipped 7.04 points, or 0.1%, to 4,756.50 to follow up its best day in nearly two months. The Dow Jones Industrial Average fell 157.85, or 0.4%, to 37,525.16, and the Nasdaq composite rose 13.94, or 0.1%, to 14,857.71.


Market Watch