Traders Market Weekly: Inflation and Bank Earnings

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    Last year’s best sector, the energy sector $XLE -3.6% was the worst performer today as energy complex futures sold off hard:

    WTI crude #oil futures fell 3.9% to $76.97/bbl
    HH #naturalgas futures fell 10.4% to $3.68/mmbtu.

    Sizable losses in Tesla (TSLA 108.10, -15.08, -12.2%), which disappointed with Q4 deliveries, Microsoft (MSFT 239.58, -0.24, -0.1%), NVIDIA (NVDA 143.15, -2.99, -2.1%), and Apple (AAPL 125.07, -4.86, -3.7%), which reportedly told suppliers to build fewer components for several devices in Q1 due to weakening demand, were among the more notable standouts in that respect.

    Not all the mega-cap stocks sold off today.

    Gains in Meta Platforms (META 124.75, +4.40, +3.7%) and Alphabet (GOOG 89.70, +0.97, +1.1%) helped propel the S&P 500 communication services sector (+1.4%) to first place on the leaderboard. (AMZN 85.82, +1.82, +2.2%) helped temper the losses in the consumer discretionary sector (-0.6%) that were driven by Tesla.


    New beginnings, Trading Day one of 2023 in the books:

    Dow Jones Industrial Average: flat YTD
    S&P Midcap 400: -0.5% YTD
    S&P 500: -0.4% YTD
    Russell 2000: -0.6% YTD
    Nasdaq Composite: -0.8% YTD

    • This reply was modified 2 months, 2 weeks ago by TradersCom.

    Another Day in Politics:

    New Congress convened today, but Republican-controlled House unable to elect a Speakerof the house
    Heads to multiple ballots for first time since 1923. House cannot conduct any further business until Speaker of the House elected.


    Wrecked: Phathom Pharmaceuticals $PHAT down 24.9%

    FDA notified the company that no action will be taken on its NDA for vonoprazan;
    Meaning Phathom no longer expects product launches for H. pylori or erosive esophagitis in 1Q23.


    #Wrecked: Vera Therapeutics $VERA down 62.3%

    – Announces Positive Topline Results of Phase 2b ORIGIN Clinical Trial of Atacicept for Treatment of IgA Nephropathy #biotech
    – Plans to advance atacicept into pivotal Phase 3 trial first half of 2023


    In the Big Race France Moved further ahead today….

    What’s $12 Billion between friends?

    1 Bernard Arnault $164B +$1.99B +$1.99B
    2 Elon Musk $128B -$9.09B -$9.09B

    As of January 3, 2023

    The Bloomberg Billionaires Index is a daily ranking of the world’s richest people. Details about the calculations are provided in the net worth analysis on each billionaire’s profile page. The figures are updated at the close of every trading day in New York.

    Rank Name Total net worth $ Last change $ YTD change Country / Region
    1 Bernard Arnault $164B +$1.99B +$1.99B France
    2 Elon Musk $128B -$9.09B -$9.09B United States
    3 Gautam Adani $119B -$1.61B -$1.61B India
    4 Bill Gates $109B -$111M -$71.6M United States
    5 Jeff Bezos $109B +$1.81B +$1.81B United States
    6 Warren Buffett $108B +$275M +$275M United States
    7 Larry Ellison $92.9B +$1.04B +$1.04B United States
    8 Mukesh Ambani $87.3B +$171M +$171M India
    9 Steve Ballmer $85.8B -$26.6M -$26.6M United States
    10 Larry Page $83.7B +$775M +$775M United States


    Equity indices in the Asia-Pacific region were mixed with some decent moves on either side of the unchanged line.

    —Equity Markets—

    Japan’s Nikkei: -1.5%
    Hong Kong’s Hang Seng: +3.2%
    China’s Shanghai Composite: +0.2%
    India’s Sensex: -1.0%
    South Korea’s Kospi: +1.7%
    Australia’s All Ordinaries: +1.7%


    Japan’s Nikkei was the weakest link, returning from yesterday’s holiday. A stronger yen, which coincided with a Nikkei report that PM Kushida will aim to speak with the new BOJ Governor about whether to adjust the 2% inflation target, has garnered some attribution for the weakness. Conversely, the Hang Seng surged with a 3.2% gain as investors took a liking to the prospect of China providing more fiscal support, particularly for major property developers.
    In other news, Bloomberg reports that China is going to pause its semiconductor investment plan due to the rising COVID costs it is incurring, the Bank of Japan conducted another unscheduled bond purchase operation, and the Japanese press is reporting that PM Kishida and President Biden are slated to discuss North Korea, Ukraine, and Taiwan on January 13.
    Japan’s December Manufacturing PMI 48.9 (expected 48.8; last 49.0)
    India’s Nikkei Services PMI 58.5 (expected 55.5; last 56.4)


    Major European indices are sporting some nice-sized gains in Wednesday’s trade, driven by hopes of a soft-landing scenario that have been forged on the back of some relatively pleasing December Services PMI reports for the eurozone, encouraging inflation data out of France and Germany, and the relief of plummeting natural gas prices.

    —Equity Markets—

    STOXX Europe 600: +1.2%
    Germany’s DAX: +1.3%
    U.K.’s FTSE 100: +0.3%
    France’s CAC 40: +2.0%
    Italy’s FTSE MIB: +1.9%
    Spain’s IBEX 35: +1.7%


    Sovereign bond yields have come down nicely in response to the inflation data.
    The 10-yr German bund yield is down 12 basis points to 2.27%. EUR/USD +0.6% to 1.0609.
    Eurozone’s December Services PMI 49.8 (expected 49.1; last 48.5)
    Germany’s November Import Price Index -4.5% m/m (expected -1.6%; last -1.2%) and +14.5% yr/yr (expected +18.0%; last +23.5%); December Services PMI 49.2 (expected 49.0; last 46.1)
    France’s December CPI -0.1% m/m (expected +0.4%; last +0.3%) and +5.9% yr/yr (expected +6.4%; last +6.2%)
    Spain’s December Services PMI 51.6 (expected 50.8; last 51.2)
    Italy’s December Services PMI 49.9 (expected 49.5; last 49.5)
    UK’s November Mortgage Approvals 46.08K (expected 55.00K; last 57.88K)
    Switzerland’s December CPI -0.2% m/m (expected -0.2%; last +0.1%) and +2.8% yr/yr (expected +2.9%; last +3.0%)


    Tesla (TSLA 109.60, +1.50, +1.4%) and Microsoft (MSFT 234.20, -5.38, -2.3%) are among the more influential stocks in premarket action. The former is higher on news that Cathie Wood (ARKK) purchased more shares of Tesla while the latter received a downgrade to Neutral from Buy at UBS.

    Treasury yields continue to pullback. The 2-yr note yield is down four basis points to 4.33% and the 10-yr note yield is down 11 basis points to 3.68%.


    Tesla (TSLA 107.76, -0.34, -0.3%) deteriorated from its earlier gain while Microsoft (MSFT 232.72, -6.86, -2.9%) fell deeper into negative territory.


    Gains in a few mega cap names are helping boost the broader market. Apple (AAPL 126.27, +1.20, +1.0%) and Tesla (TSLA 109.32, +1.24, +1.2%) are winning standouts while Microsoft (MSFT 228.98, -10.62, -4.4%) goes against the grain after receiving a downgrade to Neutral from Buy at UBS.

    The advance-decline line reflects a strong positive bias thus far. Advancers lead decliners by a nearly 5-to-1 margin at the NYSE and a greater than 3-to-1 margin at the Nasdaq.

    ISM Manufacturing Index fell to 48.4% in December consensus 48.5% from 49.0% in November.

    JOLTS – Job Openings increased to 10.458 million in November from a revised total of 10.512 million in October (from 10.334 million).


    Dow -31.65 at 33104.65, Nasdaq -24.62 at 10362.28, S&P +1.56 at 3825.70

    The 2-yr note yield, at 4.31% shortly before the releases, rose to 4.38%. The 10-yr note yield, at 3.67% a short time ago, shot up to 3.71%.

    There’s still some underlying strength in the market despite the index level deterioration. The Invesco S&P 500 Equal Weight ETF (RSP) is up 0.7% while the S&P 500 trades flat.

    The December ISM Manufacturing Index dropped to 48.4% (consensus 48.5%) from 49.0% in October. The dividing line between expansion and contraction is 50.0%, so the sub-50.0% reading for December reflects a general contraction in manufacturing activity. The ISM for December hit its lowest level since May 2020, and marks the second straight month with a sub-50.0% reading. The key takeaway from the report is that manufacturing activity contracted in December for the second straight month, demonstrating that the cumulative effect of rate hikes around the globe is adversely impacting demand while at the same time curtailing inflation pressures.



    2-yr: unch at 4.37%
    3-yr: -4 bps to 4.13%
    5-yr: -7 bps to 3.87%
    10-yr: -8 bps to 3.70%
    30-yr: -6 bps to 3.81%

Viewing 15 posts - 31 through 45 (of 73 total)
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