Dow & S&P Set New Records Again Amidst Positive Earnings Reports – Feb 9 Market Recap
Indices
- Dow 38,671, +17 or +0.04%.
- Nasdaq 15,990, +362 or +2.32%.
- MSCI EAFE 2225.20, +2.02 or +0.09%.
- S&P 5,026 +68 or +1.37%.
- USD10Y 4.187%, +15.4bp or +3.82%.
- WTI Crude $76.60/bbl, +$4.32 or +5.98%.
Dow & S&P Set New Records Again Amidst Positive Earnings Reports.
The week started slowly as a buoyant U.S. Services (especially the ISM report) continued to torpedo market dreams of a March rate cut. The yield on the 10-year U.S. Treasury bond jumped 13 basis points and stocks closed lower across the board. However, the pullback was a brief one as excellent earnings reports grabbed the market’s attention and pushed both the Dow (Thursday) and the S&P (Friday) to new record highs. Industrial stalwart Caterpillar (CAT) beat their numbers, Chipotle Mexican Grill (CMG) continues to test the economic theory of inelastic demand by constantly raising their prices and yet still reporting higher sales and earnings, Ford Motor (F) beat, guided higher, and announced a special dividend, and Walt Disney Company (DIS) beat their earnings, guided higher, announced two new streaming services, and a $1.5 billion stake in Epic Games, producer of the Fortnite online video game.
The Week of Feb 12-16
15% of the S&P 500 report earnings this week. Of note is your father’s tech stock, Cisco Systems (CSCO), semiconductor bellwether Applied Materials (AMAT), consumer favorites Coke (KO), Kraft-Heinz (KHC), and DoorDash (DASH), as well as industrial weathervane Deere (DE). In Fintech both Robinhood (HOOD) and Coinbase (COIN) report earnings.
On the economic front, inflation data in the form January’s Consumer Price Index (CPI), Producer Price Index (PPI) and U.S. Retail Sales is due out this week and manufacturing activity is expected from Philadelphia and New York.
Economic Calendar
- Monday – N/A. Earnings: N/A.
- Tuesday – January Consumer Price Index (CPI). Earnings: Airbnb (ABNB), Coca-Cola (KO), Robinhood (HOOD).
- Wednesday – N/A. Earnings: Cisco Systems (CSCO), Kraft-Heinz (KHC)
- Thursday – Initial Jobless Claims, February Empire State Manufacturing and Philadelphia Federal Manufacturing Index, January Retail Sales. Earnings: Coinbase (COIN), Applied Materials (AMAT), Deere (DE), DoorDash (DASH),
- Friday – January Producer Price Index (PPI). Earnings: N/A.
If you know of any friends or family members who could benefit from our services and these types of communiques during these unique times, we are accepting new clients and offer a complimentary one-hour review.
Feb 9 Daily Trading Recap…
Monday – Dow -274 to 38,380, Nasdaq -31 to 15,597, S&P -15 to 4,942, USD10Y +13.1bp to 4.164%.
- Nine of eleven S&P sectors traded down today, led lower by Materials, Utilities, and Real Estate.
- January Final U.S. S&P Services PMI was slightly worse at 52.5 vs last month’s 52.9 print.
- January Final U.S. ISM Services Index bounced back strongly to 53.4% vs December’s tepid 50.5% print.
- Earnings: Caterpillar (CAT) beat their numbers and traded up +2%. McDonald’s (MCD) beat earnings but missed on revenues and traded down -3.73%.
Tuesday – Dow +141 to 38,521, Nasdaq +11 to 15,609, S&P +11 to 4,954, USD10Y –7.4bp to 4.09%.
- Nine of eleven S&P sectors traded higher today, led by Materials, Real Estate, and Health Care.
- Earnings: Chipotle Mexican Grill (CMG) beat both its earnings and revenue estimates as 3% price hikes instituted in October made their intended impact; CMG traded up +2% in the extended session. Ford Motor (F) blew out its earnings and revenue estimates, guided 2024 higher and announced a special dividend; F traded up +6% post close.
Wednesday – Dow +156 to 38,677, Nasdaq +147 to 15,756, S&P +40 to 4,995, USD10Y +2.0bp to 4.11%.
- Nine of eleven S&P sectors traded higher today, led by Technology, Consumer Discretionary, and Communication Services.
- Earnings: Walt Disney (DIS) beat their earnings expectations handily, reported slightly lower than expected earnings, raised guidance, announced the launch of their streaming ESPN service in 2025, announced a $1.5 billion stake in Fortnight maker Epic Games, and announced a new sports streaming service combining content from ESPN, Fox Sports, and Warner Brothers; DIS traded +6.48% post close.
Thursday – Dow +49 to 38,726 (new record close), Nasdaq +37 to 15,793, S&P +3 to 4,997, USD10Y +6.0bp to 4.17%.
- Six of eleven S&P sectors traded higher today, led by Energy, Real Estate, and Communication Services.
- Jobless claims fell to 218,000, vs 221,000 forecast and vs. last week’s slightly revised higher print of 227,000 (originally 224,000).
Friday – Dow -54 to 38,671, Nasdaq +196 to 15,990, S&P +29 to 5,026 (new record close), USD10Y +1.7bp to 4.187%
- Eight of eleven S&P sectors traded higher, led by Technology, Consumer Discretionary, and Communication Services.
- Earnings: Pepsi Co (PEP) beat earnings estimates but missed their revenue expectations. CEO Ramon Laguarta blamed lagging sales on “…a slowdown due to pricing (the effect of Pepsi raising prices) and consumers’ disposable income situation;” PEP traded down 3.55%.
If you know of any friends or family members who could benefit from our services and these types of communiques during these unique times, we are accepting new clients and offer a complimentary one-hour review.
Disclaimer: This is not a recommendation to buy or sell any of the securities listed above. I personally, or a family member whose account I control, have positions in the following securities/assets…Bitcoin, Cardano, Chainlink, Ethereum, AVGO, BITB, ETHE, GBTC, and GOOGL.