Sage Investment Club

ozgurdonmaz U.S. stocks on Monday advanced, helped by broad-based gains in megacap technology stocks, with investors looking ahead to inflation data and the start of the fourth-quarter earnings season later in the week. The tech-heavy Nasdaq Composite (COMP.IND) jumped 2.12% to 10,793.48 points in morning trade, buoyed by a ~3% gain in Alphabet (GOOGL) (GOOG), Microsoft (MSFT), Apple (AAPL) and Amazon (AMZN). An ~8% rally in shares of Tesla (TSLA) also helped. The benchmark S&P 500 (SP500) was higher by 1.41% to 3,950.12 points, while the blue-chip Dow (DJI) added 0.89% to 33,930.82 points. Of the 11 S&P sectors, ten were trading in the green, led by Technology and Consumer Discretionary. Health Care was the only loser. All three major indices built upon their sharp rally in the previous session, triggered by the release of the government’s monthly jobs report which pointed to signs of potential softening in the labor market. “Friday’s US employment report will be revised, but the evidence could be a signal of some economic weakness ahead,” UBS’ Paul Donovan wrote. “The US has experienced very negative real wage growth – even when ignoring fictitious prices like owners’ equivalent rent. Consumers have supported living standards using credit and savings.” “If the savings and credit resources disappear, in the absence of pay bargaining power the consumer may take on more work to stabilize their living standards,” Donovan added. “That breaking point may now have been reached. Employment participation rose, especially in lower income sectors (which is one reason average hourly earnings slowed). The share of people with multiple jobs leapt above pre-pandemic norms. Higher prices may be changing behavior.” Turning to the bond markets, rates were lower. The 10-year Treasury yield (US10Y) was down 4 basis points to 3.53%. The 2-year yield (US2Y) was lower by 5 basis points to 4.21%. In economic data, TD Ameritrade’s investor movement index came in at 4.17 for December, unchanged from November’s reading. Market participants are looking ahead to Thursday’s December CPI report, which is expected to show a moderation in inflation and provide some calm to the Federal Reserve’s worries over soaring consumer prices. The fourth-quarter earnings season will also kick of later this week, with three of the biggest U.S. banks on tap to report their results. Among active stocks on Monday, Alibaba (BABA) rose after Jack Ma ceded control of Ant Group. Arrowhead Pharmaceuticals (ARWR) was among the top percentage losers on the Nasdaq Composite (COMP.IND) following the release of data from a mid-stage trial of its liver disease drug.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *