Daily Digest:
w/c 15 July - Financials earnings reports kick off the week, then we get Netflix results Thursday. US Retail Sales is the standout macro data this week on Tuesday. We also get the latest ECB interest rate decision on Thursday.

Record Highs Again for US Stock Averages, Despite Fading March Rates Cut Hopes

Intermediate

Macroeconomic/ geopolitical developments

  • US stocks were up again, experiencing a robust rally on Friday, propelling the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite to new record highs. The surge was primarily fueled by major technology players.
  • The Federal Reserve have dampened March rate cut Hopes, with chairman Jerome Powell emphasising the need for “greater confidence” in reaching the 2% inflation target before considering rate cuts.
fed
  • The Bank of England remained cautious and despite acknowledging a significant and relatively sharp decline in inflation over the past few months, they refrained from providing a specific timetable for potential rate cuts.
  • Earnings Recap: Meta Platforms, Amazon and Microsoft stocks surge, as they beat expectations. Alphabet slightly surpassed expectations, but shares experienced a more than 6% decline in after-hours trading, due to lower than expected ad revenue. Apple also slightly surpassed expectations, but stocks also fell, as concerns over low sales in China grow.
meta
  • The US employment report for January significantly exceeded expectations, adding an impressive 353,000 jobs, well above the Dow Jones estimate of 185,000. There was also a notable uptick in wage growth, with average hourly earnings increasing by 0.6%, double the monthly estimate.
US Nonfarm Payrolls

Global financial market developments

  • Global equity index futures rallied, with US averages again at record highs.
  • US and European yields chopped, moving to lower yields before reversing Friday.
  • The US Dollar Index consolidated, then surged higher Friday.
  • Gold futures consolidated again at the lower end of the intermediate-term range.
  • Oil futures plunge lower for a more negative outlook.

Key this week

Central Bank Watch: A quiet week for central banks, with the Reserve Bank of Australia (RBA) Tuesday, plus as always, a focus on Fed speakers.

Macro Data Watch: Also, a quiet week for data. The focus for the week will be Monday’s Services and Composite PMI data.

Earnings Watch: A quieter for earnings as the reporting season winds down, with standouts of McDonald’s, Eli Lilly, Uber, AstraZeneca and Pepsi.

DateMajor Macro Data
02/05/2024Global Services and Composite PMI, US ISM Services PMI
02/06/2024RBA Interest Rate Decision, Statement and Press Conference, EU Retail Sales (MoM, YoY)
02/07/2024Nothing of note
02/08/2024China CPI (MoM, YoY) and PPI (YoY)
02/09/2024German Consumer Prices (MoM, YoY), Canada Employment report
DateMajor Earnings Data
02/05/2024McDonald’s, Caterpillar, Sony
02/06/2024Eli Lilly, Linde, Amgen
02/07/2024Walt Disney, Uber
02/08/2024AstraZeneca, Philip Morris, S&P Global
02/09/2024Pepsi

Editor in chief

Steve Miley is the Market Chartist and has 32 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued

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