Market in Review 1/19/2024

MARKET REPORT

Review:
– S&P 500 hits record high 4820 (Prev 4818 Jan 4th, 2022)
– Shares of the so-called Magnificent Seven – Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla – surged between about 50% and 240% last year. Collectively, they account for about 28% of the S&P 500 and were responsible for nearly 66% of the index’s total return last year.
– Uni of Michigan inflation expectations fell to 2.9% for Jan vs 3.1% Dec
– Existing Home Sales hit 13 year low. Dropped by 1% to 3.78 mil for Dec, Exp 3.82 mil. Midwest and South down, increase in West, UNCH Northeast.
– EHS for 2023 the year hit 30yr low (high mortgage rates. Fun-fact ‘Mortgage’ is the combination of the Latin word Mort = Death and gage = engaged. So, mortgage literally means: to be engaged unto death.
– Fed (SF, Voting) Pres Mary Daly “it’s really premature to think that that’s around the corner,” (Cuts)

– Money markets now are pricing in a March cut with under a 50% probability ahead of the January Fed blackout period ahead of the FOMC’s (31st Jan) meeting.

– Dollar early strength fades to down small 103.05 (-0.25%)
– Gold early strength fades up small $2031 (+0.5%)
– Equities FIRMER SP500 RECORDS HIGHS (+1.2% 4870) NasDaq +2% 17440
– Crypto support tested held, afternoon rally +1000 42k, ETH +2% 2500
– Crude early strength fades down small, RES at $74 holds closes $73.84

DOLLAR:
– AUD up: 65.96                      +0.35% (65.66 – 66.02) close just off highs
– EUR down smalls                 -0.15% (92.00 – 91.75) close lows
– GPB UNCH: 126.95             UNCH (127.10 – 126.63) close mid to high rge
– JPY UNCH: 148.18              UNCH (148.77 – 147.84) close mid to low rge

GOLD up small: $2031         +0.5% (2041 – 2022) close mid rge
DOW/ES/ND:                        38050 +1.0%, 4865 +1.1%, 17430 +1.8%
CRYPTO: BTC/ETH:            +1200/3% 42000, +55/2.25% 2500
CRUDE: $73.84                     -$0.24/-0.32%

Upcoming/Next Week:

US:
Advance Est GDP Q4 growth rate
PCE Price Indexes
Personal Income & Spending
Durable goods
Manufacturing and Services PMI
New and Pending Home Sales

Stonks Earnings: Microsoft, Tesla, Visa, P&G, Netflix, Intel, TMobile, Verizon, IBM & Amex.

IR Decisions: Euro area, Japan & Canada

Manufacturing & Services PMI’s: Euro area, Japan, Australia & UK.

AU: NAB Business Confidence

Speakers:

MAJORS:

DX:
Despite Fed Daly (voting) saying “it’s premature to think cuts around corner, would like more evidence Fed is on track to hit target” (2%) the morning strength of the Dollar waned into the close. A muted close with the AUD firming slightly, the EURO firming slightly and the YEN and Pound flat on the day. Plethora of data next week (including co. earnings) (see above).

No real impetus either way.

No call.

1-

AUD:
“Buy a dip on turn or go with upward momentum to at least 66 handle.”
Yest Mkt Report.

Good opportunity as we saw two dips, 2am hitting 65.66 and 10.30am 65.72 before both times hitting the 66 handle. I, again overestimated the range for a relatively muted session, but the sentiment was correct.

Can’t see us getting much below 65.50 or over 66.50 without a change in macro.

6

EUR:
A washy nothing session for the Euro, we barely broke 20 pips. A little drift off afternoon. Nothing to report.

Attention turns to the ECB next week but looking ahead, JPMorgan expects the ECB to start cutting rates in June, against their prior forecast of September.

No call.

9-

POUND:
A decidedly weaker UK Retail Sales figure (Exp -0.% Actual -3.2%) saw the Pound straight line from 127 even to 126.80 and making its way to 126.63 before an afternoon rally (more Buck Malaise ((my porn name)) saw it regain all loses and close exactly… 127 even.

Favour a return to 127.75, buying a dip or go with god. I mean strength.

126.75 – 127.75

YEN:
147.75 – 148.75 rge today resting around 148 even.
Japan CPI data being broadly in line with expectations aside from the Y/Y headline which was slightly above, but still eased from the prior. Attention turns to the BoJ next week.

No call

1

GOLD & SILVER:
Hopes for another firm day appeared early as GC touched 2042, but failed to hold as we drifted off to close mid-range 2031.

SI banged its head repeatedly against the previously noted $23 level before following GC’s drift to 22.60, closing 22.70.

Washy from here.

EQUITIES:
US:
– SPX +1.23% 4,839
– NDX +1.95% 17,313
– DJIA +1.05% 37,863
– RUT +1.08% 1,944

EUR:
– DAX -0.07% 16,555.13
– FTSE 100 +0.03% 7,461.43
– CAC 40 -0.40% 7,371.64
– Euro Stoxx 50 -0.12% 4,447.75

SECTORS (S to W): Technology +2.35%, Financials +1.64%, Communication Services +1.63%, Consumer Discretionary +1.02%, Real Estate +0.96%, Industrials +0.61%, Energy +0.37%, Materials +0.10%, Health +0.06%, Utilities -0.12%, Consumer Staples -0.33%.

Spirit Airlines  +17%: Q4 revenue is expected to be at the high end of the initial guidance range, with adj. operating margin guidance for Q4 positively revised up by 450bps to negative 12-13%. Moreover, Spirit is looking to convince JBLU to appeal the judge’s decision blocking their merger.
IRobot -27%: European Commission plans to block Amazon’s (AMZN) USD 1.7bln acquisition of iRobot, according to WSJ.
Wayfair +10%: Cutting its workforce by 1,650 employees (13% of global workforce) to deliver annualized cost savings of more than USD 280mln.

Earnings:

State Street +2%: Surpassed expectations on EPS, revenue, NII, and NIM alongside issuing a new USD 5bln share buyback program. FY24 NII seen declining less than forecast.


OIL
:
WTI (H4) SETTLED USD 0.70 LOWER AT 73.25/BBL; BRENT (H4) SETTLED USD 0.54 LOWER AT 78.56/BBL

The crude complex was lower on Friday, but settled the week in firmer territory amid heightened Middle East tensions. Nonetheless, oil-specific news flow was light to end the week as WTI and Brent chopped between USD 72.99-74.63/bbl and 78.32-79.73/bbl, respectively, with noting obvious driving price action. Despite saying this, traders continue to monitor US supply given the current deep freeze hitting the Gulf coast – North Dakota oil output is estimated to be down 350-400k BPD and it may take one month to return to normal production, while Bloomberg said the winter freeze is keeping 15% of the gulf coast crude capacity shuttered. Elsewhere, in the weekly Baker Hughes rig count, oil fell 2 to 497, nat gas rose 3 to 120, leaving the total up 1 to 620. Looking ahead, participants will continue to monitor the geopolitical risk in the Middle East and Red Sea on top of next week’s major risk events in the form of ECB, BoJ, US GDP & PCE, amongst others.
Oil report courtesy of newsquark

BOND YIELDS:

US 1-MO 5.388 +0.015 US 6-MO 5.236 +0.011 US 1-YR 4.87 +0.034 US 5-YR 4.051 +0.002 US 10-YR 4.128 -0.016 US 30-YR 4.337 -0.035
2YR/10YR -0.26

CRYPTO
“We are hitting crucial support around 40.8 – 41.1k in BTC. May test, but itll hold.”
Yest Mkt Report

BTC hit 40.3K (Stops around my levels above) before returning to 42K. A little drift off to 41.7k on ‘close’.
Appears 40 n change will hold firm. I think it will.

ETH say its slide from 2500 to 2415 (I had 2385) before we went straight back to 2500.

We might get a little more ‘fun’ but Id be buying dips or going with solid upward flow.

Best of luck out there. Let the market come to you

We do our best to provide correct information and pricing. We do not accept liability on for error. All pricing listed has been taken care and checked but no liability assumed in error.

As ALWAYS, any advice given is general in nature and is not suited to each traders individual: situation/time-frame/goals/financial circumstance/risk profile/loss mechanics etc
We offer ideas for trades from time to time, we accept no liability for results, they are to be traded on your discretion and responsibility.

I can be contacted should anyone have any questions, input at info@theconcepttrading.com during US hours of EST 9am until 5pm

 

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