2024 MARKET INSIGHTS
Monthly Market Roundup | U.S. Equities
Big Movers In February 2024
Coinbase Global (COIN): The cryptocurrency exchange reported better-than-expected results. It also benefited from Bitcoin and Ethereum rallying to new 52-week highs.
Paramount Global (PARA): Takeover speculation lifted the media company in January, but it fell last month as hopes of a deal faded.
Constellation Energy (CEG): The electric-utility stock beat estimates and raised guidance. It benefited from tax credits because of its zero-emission nuclear plants.
Charter Communications (CHTR): The broadband company missed estimates by a wide margin as subscribers defected.
Nvidia (NVDA): The chip designer became the market's 3rd most valuable company after growing AI demand fueled strong results.
Insulet (PODD): The diabetes-testing company's guidance for the first quarter was lower than forecast.
Key Economic Events Last Month
Job Growth, Wages Surge Past Forecasts
The U.S. added 353,000 jobs in January and wages increased by 0.6%. Both readings were about twice the forecast amounts. (2/2)
Inflation Ran Hot in January
The Consumer Price Index (CPI) rose 0.3% in January, above the 0.2% estimate. Costs for shelter, food, insurance and medical care drove the increase. (13/2)
Retail Sales Fall More than Expected
Retail sales declined by 0.8% in January, missing estimates for a 0.1% drop. It was the first time in seven months that sales missed projections. Economists said bad weather may have caused the shortfall. (15/2)
GDP Growth Revised Slightly Lower
The Commerce Department lowered its estimate for fourth-quarter economic growth from 3.3% to 3.2%, noting smaller inventory growth. Consumer spending was stronger than initially thought. (28/2)
Key Futures Contracts
| Product Name | Current Month | Expiration | Next Month | 1-Mon% |
|---|---|---|---|---|
| S&P 500 E-Mini (@ES) | ESH24 (Mar) | 15 Mar 24 | ESM24 (Jun) | +4.8% |
| *S&P 500 E-Mini Micro (@MES) | MESH24 (Mar) | 15 Mar 24 | MESM24 (Jun) | +4.8% |
| Nasdaq-100 E-Mini (@NQ) | NQH24 (Mar) | 15 Mar 24 | NQM24 (Jun) | +4.8% |
| *Nasdaq-100 E-Mini Micro (@MNQ) | MNQH24 (Mar) | 15 Mar 24 | MNQM24 (Jun) | +4.8% |
| Dow Jones E-Mini (@YM) | YMH24 (Mar) | 15 Mar 24 | YMM24 (Jun) | +2% |
| *Dow Jones E-Mini Micro (@MYM) | MYMH24 (Mar) | 15 Mar 24 | MYMM24 (Jun) | +2% |
* Micro contracts are one-tenth the size of standard e-minis.
Events to Watch This Month
| Date | Event | What to Watch |
|---|---|---|
| Wed, 6-Mar | Congressional testimony by Jerome Powell | Comments on interest rates and inflation before policy meeting on 20 March |
| Fri, 8-Mar | Employment report | Hiring and wage trends in February |
| Tue, 12-Mar | Consumer price index (CPI) | Inflation trends |
| Mon, 18-Mar | Nvidia GPU Technology Conference (18-21 March) | AI news and developments |
| Wed, 20-Mar | Fed interest rate decision with economic projections | “Dot plot” will reflect central bank’s plans for potential rate cuts this year. |
Sector Watch
Consumer Discretionary was the top sector last month, led by retailers like Ralph Lauren and Tapestry.
Industrials outperformed as engineering companies, manufacturers and airlines advanced.
Utilities fell the most as interest rates increased as investors favored stocks with more sensitivity to economic growth.
Consumer staples, typically considered safe havens, lagged as risk-on sectors outperformed.
Noteworthy Calls & Predictions
The Nasdaq-100 could double or triple over the next three years because of AI, Gene Munster of Deepwater Asset Management told CNBC. He added that stocks are in the early stages of a bubble forming. Munster expects further expansion as multiples increase.
Nasdaq-100UBS raised its price target on the S&P 500 from 5,145 to 5,400 based on better-than-expected earnings. The bank sees opportunity in health care and financials. On 27/2, Barclays hiked its estimate from 4,800 to 5,300, but sees potential for a move to 6,050 if big tech earnings are strong.
S&P 500The Conference Board no longer expects a recession because six of the 10 leading economic indicators in its index have turned positive. The next day, S&P Global Ratings increased its forecast for economic growth this year from 1.5% to 2.4%.
U.S. economyGoldman Sachs expects bullish sentiment to widen as hedge funds allocate capital to momentum strategies. The analysis considered surveys, derivatives pricing and the positive macroeconomic backdrop.
U.S. stock marketNvidia’s most recent earnings report may open the door to a new “roaring 20s,” according to Jason Draho of UBS Global Wealth Management. He said accelerating AI investment could potentially boost labor productivity, increasing the economy’s productive capacity.
U.S. economy & stock marketDisclosure
The material is provided by TradeStation International Ltd, authorised and regulated by the FCA (554431) in the UK and acting as an introducing broker to affiliated and non-affiliated brokers such as TradeStation Securities, Inc., and Interactive Brokers (U.K.) Ltd. The firm does not provide investment advice or trading recommendations.