📊 Payrolls Eclipse Expectations

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Ticker Tea
April 08, 2024

Happy Monday ☕ It will be 20 years until there is another total solar eclipse visible from the U.S., so be sure to check it out if you’re able. The NASA live stream can be found here.

Last Friday, the major US stock indices posted gains led by optimism of continued economic strength (eco data results 👇) which is expected to bolster consumer spending and corporate profits.

Economic Data Insights: U.S. nonfarm payrolls for March significantly exceeded forecasts, rising by 303,000 jobs, the most in 10 months, signaling sustained economic strength. Meanwhile, wage growth cooled to a 4.1% year-over-year increase, the slowest in nearly three years, easing some inflation concerns.

Federal Reserve and Interest Rate Outlook: Federal Reserve officials indicate that immediate rate cuts are unlikely due to persistent inflation risks. Remarks from Fed representatives suggest a potential shift towards a higher baseline for future interest rates, emphasizing a cautious monetary policy approach.

Consumer Credit and Market Sentiments: Consumer credit growth was weaker than expected in February, possibly reflecting growing consumer caution. Additionally, recent spikes in crude oil prices, now above $85/barrel, are likely to heighten inflationary pressures and impact spending on essentials like heating and transportation.

Upcoming Market Indicators: This week's key events include the 30-year bond auction, which will test investor confidence and could influence Fed rate decisions. CPI and PPI data will provide insights into inflation trends, critical for upcoming Fed policies. The release of FOMC meeting minutes might also stir short-term market volatility, offering deeper insights into the Fed's deliberations.

A few equity headlines from Friday 👇

  • Newmont (NEM) closed up more than +5% following a rally in gold to a record high and a two-year high for silver prices. (chart)

  • Shockwave Medical (SWAV) closed up more than +1% after Johnson & Johnson agreed to acquire the company for $13.1 billion at $335 per share. (chart)

  • Tesla (TSLA) closed down more than -3% following a Reuters report that the company scrapped plans to build a low-cost entry-level car. (chart)

  • Paramount Global (PARA) closed down more than -3% after CNBC reported that Skydance Media plans to keep the company public and merge its assets. (chart)

  • Intel (INTC) closed down more than -2%, leading losses in both the Dow Jones Industrials and Nasdaq 100, after a pessimistic factory operations forecast. (chart)

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» Genting Malaysia Bhd ($GENM) has committed to elevating its annual tax payments to over $1 billion as part of its bid to secure one of three new casino licenses in New York City. This strategic move underscores the company's expansion efforts at its Queens resort, amidst stiff competition from other major industry players. (link)

» Gold prices have unexpectedly surged to record highs, leaving analysts puzzled despite conventional wisdom pointing to geopolitical tensions and economic uncertainties. The rally challenges typical market behaviors, with influences ranging from central bank maneuvers to speculative trading, underpinning gold's new peak. (link)

» Bond traders are eyeing the 4.5% yield mark for 10-year Treasuries as a critical threshold amid persistent inflation fears and robust U.S. economic performance. The upcoming CPI data is pivotal, potentially stabilizing or further boosting yields depending on its alignment with inflation expectations. (link)

» Tesla ($TSLA) is set to unveil its long-awaited robotaxi on August 8, aiming to boost its valuation amidst sluggish sales and rising competition from budget-friendly Chinese EVs. The announcement, made by CEO Elon Musk, spurred a 5.1% rise in Tesla's stock during postmarket trading. (link)

» Stock futures edged higher in overnight trading, indicating a mild rebound after a challenging week saw the Dow, S&P 500, and Nasdaq all post losses. Investors remain hopeful yet cautious, eyeing upcoming economic reports on inflation and consumer spending to guide future moves. (link)

» A Southwest Airlines ($LUV) Boeing ($BA) 737-800 lost an engine cowling during takeoff from Denver International Airport, leading to a safe return and an FAA investigation. This incident compounds Boeing's recent challenges, which include safety issues and regulatory scrutiny impacting aircraft deliveries and operational expansion. (link)

» As the Federal Reserve signals a slower move toward easing interest rates, wary investors are increasingly hedging against potential market downturns. The shift, marked by a spike in the Cboe Volatility Index and growing demand for S&P 500 puts, reflects heightened concerns over geopolitical risks and economic uncertainties. (link)

» United Airlines ($UAL) has canceled its upcoming May 1st investor meeting following a series of safety incidents, opting to refocus on collaborating with the FAA to enhance its safety protocols. The airline plans to reschedule the event for the fall, aiming to then highlight its strategic advantages and future prospects. (link)

Major ($10bn+) earnings releases scheduled the next five business days 👇 Click here for a comprehensive list of upcoming earnings releases

Results from Friday’s economic releases & today’s schedule below 👇 Click here for full schedule & live updates of Wall Street estimates.

 

“Happiness is not something ready made. It comes from your own actions.”
Dalai Lama XIV

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