Overview of Stock Market
The article begins by highlighting the current state of the stock market, noting that stocks are trading within narrow ranges. The focus is on upcoming company earnings reports, seen as crucial for gaining insights into the global economy.
Current Stock Performance
In terms of current stock performance, the S&P 500 shows a slight increase, the Nasdaq 100 remains relatively unchanged, and the Dow Jones Industrial Average experiences a small decline. Notably, US-listed Chinese shares show gains.
Earnings Reports
Positive earnings reports from major companies such as United Airlines Holdings Inc., Verizon Communications Inc., and Johnson & Johnson are highlighted. The fourth-quarter US earnings season is described as off to a solid start, with over 80% of companies beating profit estimates.
Netflix Inc
Netflix’s announcement of a deal with World Wrestling Entertainment is emphasized, and there is anticipation surrounding the upcoming earnings release of the company.
Federal Reserve’s Warnings
Despite warnings from the Federal Reserve about potential future interest-rate cuts, the article notes that equities have largely overlooked these concerns, focusing instead on the economy’s resilience.
Central Banks in Focus
The Bank of Japan’s decision to keep rates steady is mentioned, with speculation about a possible rate hike in the first part of the year. Attention is also turning to the European Central Bank’s upcoming meeting.
Corporate Highlights
Notable corporate events include Johnson & Johnson beating earnings estimates, Verizon providing positive guidance for 2024, D.R. Horton Inc. slipping on weaker-than-expected quarterly orders, and Coinbase Global Inc. falling after a downgrade from JPMorgan.
Upcoming Key Events
The article lists key events for the week, including the New Hampshire presidential primary, Canada rate decision, Eurozone and US PMI data, and important economic indicators like US GDP, initial jobless claims, and more.
Market Moves
The S&P 500 and Nasdaq 100 performance, along with movements in currencies, cryptocurrencies, bonds, and commodities, are reported. This information provides a comprehensive overview of the current market situation, major corporate developments, and upcoming economic events.
Market Overview
– March E-Mini S&P 500 futures (ESH24) are up +0.12%, and March Nasdaq 100 E-Mini futures (NQH24) are up +0.25%.
– Stock index futures are modestly higher due to mixed corporate earnings results.
Corporate Earnings Impact
– United Airlines Holdings (UAL) reports stronger-than-expected Q4 adjusted EPS, leading to a +6% jump in its stock.
– Verizon Communications (VZ) rises more than +4% after forecasting 2024 adjusted EPS above consensus.
– 3M Co (MMM) drops more than -7% after forecasting 2024 adjusted EPS below consensus.
– General Electric (GE) falls more than -3% after predicting weaker-than-expected Q1 profits.
Market Sentiment and Expectations
– Markets are discounting the likelihood of a -25 basis points rate cut at the next FOMC meeting on Jan 30-31.
– U.S. and European government bond yields are higher, with 10-year T-note, German bund, and UK gilt yields showing increases.
– Overseas stock markets are mixed, with the Euro Stoxx 50 down, China’s Shanghai Composite up, and Japan’s Nikkei slightly lower.
– Swaps suggest expectations for a -25 basis points rate cut by the ECB in upcoming meetings.
Developments in Asian Markets
– China’s Shanghai Composite Index recovers from a 3-3/4 year low and closes higher, driven by prospects of additional stimulus measures.
– Japanese stocks fall as bond yields rise, reflecting expectations that the BOJ is moving closer to normalizing monetary policy.
– The BOJ raises its 2024 GDP forecast and cuts its 2024 core CPI estimate.
BOJ Statements and Outlook
– BOJ Governor Ueda mentions rising certainty in the BOJ’s outlook and signals a gradual move towards ending negative interest rates.
– Swaps indicate expectations for a +10 basis points rate increase by the BOJ in future meetings.
Pre-market U.S. Stock Movers
– Airline stocks climb, led by United Airlines Holdings (UAL) reporting strong Q4 adjusted EPS.
– Verizon Communications (VZ) rises more than +4% after positive 2024 adjusted EPS forecast.
– Western Digital (WDC) rises more than +3% after receiving an overweight recommendation and a $70 price target.
– RTX Corp (RTX) climbs more than +3% after reporting better-than-expected Q4 adjusted EPS.
– Brown & Brown (BRO) rises more than +2% after reporting Q4 revenue above consensus.
Company-Specific Highlights
– Zuora (ZUO) sees more than +2% increase in pre-market trading after Goldman Sachs upgrades the stock to buy from neutral, setting a price target of $12.
– U.S.-listed Chinese stocks, including Alibaba Group Holding (BABA), Baidu (BIDU), JD.com (JD), NetEase (NTES), PDD Holdings (PDD), and Trip.com (TCOM), rise more than +1% in pre-market trading following reports that Chinese authorities are considering measures to stabilize the stock market.
– 3M Co (MMM) experiences a drop of more than -7% in pre-market trading after forecasting 2024 adjusted EPS below the consensus estimate.
– General Electric (GE) falls more than -3% in pre-market trading after providing a Q1 adjusted EPS forecast weaker than the consensus estimate.
– DR Horton (DHI) tumbles more than -7% in pre-market trading after reporting Q1 EPS weaker than the consensus estimate.
– Alkami Technology (ALKT) slides more than -2% in pre-market trading following a downgrade by Goldman Sachs from buy to neutral.
– Invesco (IVZ) slides more than -2% in pre-market trading after reporting that Q4 net flows unexpectedly fell, below expectations.
– Coinbase Global (COIN) falls more than -4% in pre-market trading after JPMorgan Chase downgrades the stock to underweight from neutral, setting a price target of $80.
Earnings Reports
The content concludes by listing the companies scheduled to release earnings reports on January 23, 2024, including 3M Co (MMM), Baker Hughes Co (BKR), DR Horton Inc (DHI), General Electric Co (GE), and others.
Market Overview
– U.S. futures edge lower on Tuesday, consolidating after recent gains as the earnings season begins.
Premarket U.S. Stock Movers
United Airlines (UAL)
Stock rises 6.4% after reporting strong fourth-quarter results, citing its “busiest” travel period in late December, but anticipates a wider-than-expected loss in the current quarter.
Verizon (VZ)Stock rises 4.6% as the telecommunications giant declares being “well-positioned” for growth in 2024, providing an annual earnings forecast range above expectations.
Johnson & Johnson (JNJ) Stock falls 0.3% despite fourth-quarter results beating expectations; the pharmaceutical giant reiterates its full-year guidance for 2024.
3M (MMM)