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📊 Snap Back to Reality
Ticker Tea
February 26, 2024
Good Morning & Happy Monday ☀️
Last week was wild and will surely be hard to beat from a news headline and market action perspective.
Although the equity market has largely dominated the headlines over the past week, its worth noting there has been a material shift in market sentiment toward expected rate cuts this year.
At the beginning of the year the market was pricing in nearly 100% odds of a rate cut by the March fed meeting. Now, just a ~1% chance followed by ~20% chance at the May meeting.
Fed members have been aggressively pushing back on the market expectation of rate cuts coming sooner this year. The market is finally listening.
This comes as inflation came in hotter than expected, jobs remain strong and company earnings healthy, resulting in more confidence the economy can withstand higher rates for longer. As a result, the 10yr treasury has increased nearly 50bps since the lows of late Dec:
The latest end-consumer rates below:
Avg 30yr mortgage rate = ~7.3%
Avg used car rate = 10-11%
Avg new car rate = ~7%
» Friday Wrap Up: Stocks experienced a subdued day on Friday, concluding a generally strong earnings week led by the technology sector, with the S&P 500 hitting another record high and marking its sixth winning week in seven. Despite the overall market uplift, a decline in some tech companies, including a 1% fall in Apple, slightly dampened the market's momentum.
» Earnings Today: Workday, Domino’s Pizza, Zoom, Fidelity (Calendar & Estimates 👇)
» Economic Data Today: New home sales & building permits (Calendar & Estimates 👇)
» Fed Speakers Today: None today. Barr speaks tomorrow.
» AT&T ($T) announced a $5 billing credit for customers affected by a widespread wireless network outage that impacted hundreds of thousands of subscribers last Thursday. CEO John Stankey assured the cost of credits is manageable and reaffirmed the company's 2024 financial objectives, attributing the disruption to a faulty process during network expansion. (link)
» The trend of remote work is facing challenges as the white-collar labor market cools, prompting companies to reduce work-from-home options and increasingly target remote workers for layoffs. This shift is forcing many professionals, who once enjoyed the flexibility and benefits of remote work, to reconsider the importance of in-office presence to secure employment. (link)
» The Federal Reserve's preferred inflation gauge, the core personal consumption expenditures (PCE) price index, is expected to rise by 0.4% in January, marking the most significant increase in a year and highlighting the challenges in controlling inflation. (link)
» Despite the strong U.S. economy and notable successes within the tech sector, including Nvidia's ($NVDA) earnings beat and a significant rise in the Nasdaq index, the industry is witnessing an unprecedented number of layoffs in 2024. According to layoffs(.)FYI, the tech sector has already seen over 42,324 job terminations, outpacing the layoffs of 2023. (link)
» Tyler Loudon pleaded guilty to securities fraud, earning $1.76 million from insider trading by listening to his wife's work calls regarding BP's potential acquisition of TravelCenters of America. Set for sentencing on May 17, he faces up to five years in prison and a $250,000 fine, agreeing to forfeit the illegal profits. (link)
» Apple ($AAPL) is exploring new wearable devices, including a fitness ring, smart glasses, and AirPods with cameras, to expand its wearable device sector, a key revenue source. The fitness ring concept aims to transfer health-tracking features from the Apple Watch to a more discreet form, while smart glasses and enhanced AirPods are being considered to integrate AI and cameras for a more immersive user experience. (link)
Certain earnings releases scheduled for today:
Today’s scheduled economic releases:
I have not failed. I've just found 10,000 ways that won't work.
Thomas Edison
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