Wall Street Today | Boeing Fails to Bring Down Market
RECAP
The $Dow Jones Industrial Average(.DJI.US$ rebounded after pulling out of a Boeing slump. Indexes opened cautious, but built towards a rebound after the S&P 500 shed 1.5% last week to break a two-month winning streak.
$Dow Jones Industrial Average(.DJI.US$ climbed 0.58%, the $S&P 500 Index(.SPX.US$ rose 1.41%, and the $Nasdaq Composite Index(.IXIC.US$ climbed 2.20%. Large tech stocks led the way; all "Magnificent Seven" stocks were green after slumping last week.
Oil prices dropped. Front-month U.S. crude fell more than 3.79% to $71 a barrel after Saudi Arabia unveiled price cuts. Bond yields fell. The $U.S. 10-Year Treasury Notes Yield(US10Y.BD$ was recently around 4% according to moomoo.
Earnings season kicks off in earnest this week, started off by other major banking institutions $Blackrock(BLK.US$, $JPMorgan(JPM.US$, and $Bank of America(BAC.US$ Friday. U.S. inflation data is up ahead, with December consumer-price data due Thursday, followed by producer prices Friday.
MACRO
Atlanta Fed's Bostic: Inflation is on Track to 2% Target
The Atlanta Federal Reserve President Raphael Bostic said inflation is on track towards a 2% goal, but the Fed would have to remain "diligent and short run attentive" throughout the year, Bloomberg reported.
Speaking to the Atlanta Rotary Club, Bostic said he was not ready to declare victory quite yet, and policy would have to remain restrictive through the end of the year, according to the Benzinga newswire. He saw two 0.25 reductions in the target interest rate over that time, but with inflation still above target and employment slowing, they would have to remain cautious.
According to Benzinga, he said Goods inflation was back to pre-pandemic, but Services inflation was stubbornly high. He pointed to recent unemployment numbers, "far less" than what would be expected after inflation drops, and that the Fed is in a "very strong position."
SECTORS
Pharma Pulled the Nasdaq 100 into a 2% Climb
Among Thousands of Nasdaq Composite Index stocks, none were hotter Monday than Biotech and pharma companies. Bloomberg Attributed a spike of $8 Bill in value for the sector alone, as M & A deals.
$Harpoon Therapeutics(HARP.US$ climbed 112% on rumors of a $Merck & Co(MRK.US$ buyout for $680 million, while rumors of a $2B $Johnson & Johnson(JNJ.US$ buyout of $Ambrx Biopharma(AMAM.US$
Shares of $Cytokinetics(CYTK.US$ jumped 16% Monday after the Wall Street Journal reported the company was close to being bought by $Novartis AG(NVS.US$. CES, a major tech conference held in Las Vegas, also helped push Nasdaq companies like $NVIDIA(NVDA.US$.
Oil Futures Post Biggest Daily Drop Since November as Saudi Price Cut Raises Demand Worries
West Texas Intermediate $Crude Oil Futures(JUN4)(CLmain.US$ fell $3.04, or 4.1%, to settle at $70.77 a barrel on the New York Mercantile Exchange. That was the largest one-day dollar and percentage decline for a front-month contract since Nov. 16, according to Dow Jones Market Data. March Brent crude, the global benchmark, dropped $2.64, or nearly 3.4%, to $76.12 a barrel on ICE Futures Europe. It marked its biggest dollar and percentage decline since Dec. 12.
State-owned producer Saudi Aramco on Sunday said it would cut its official selling price for crude to all regions, including its largest market in Asia in February. The spread for Saudi crudes, including its flagship Arab light, over local benchmarks will be cut by up to $2 a barrel.
"When a major oil producer like Saudi Arabia offers price discounts, it's either a sign of concern about weakening demand conditions or an attempt to stop foreign producers such as the U.S.A. from stealing market share away," Marios Hadjikyriacos, senior investment analyst at XM, said in a note. "Either way, it's a bearish signal for energy prices."
COMPANIES
Boeing Shares Weigh Down Dow Industrials
$Boeing(BA.US$'s MAX 9 blowout caused a 7% drop in price, while shares in supplier $Spirit Aerosystems(SPR.US$ and $Alaska Air(ALK.US$ also slumped.
Nvidia Reaches All-Time High
$NVIDIA(NVDA.US$ share price jumped more than 5% by Monday afternoon, with most of the gains coming ahead of its CES announcements following a strong upswing for tech stocks.
Alibaba Cuts Back on the Nvidia Chips
$Alibaba(BABA.US$ stock is trading lower Monday amid reports of its intentions to reduce its orders of $NVIDIA(NVDA.US$ chips compared to its original plans when Nvidia offered its now-restricted products.
United Airlines Pulls Some Boeing 737 Planes Out of Service After Alaska Airlines Fuselage Blowout
$United Airlines(UAL.US$ has reportedly pulled 737 Boeing Max jets from service for inspections following a mid-air pressurization issue with an $Alaska Air(ALK.US$ jet on Friday night that led to an emergency landing and forced the carrier to temporarily ground all 65 jets in its Max-9 fleet.
Twilio Shares Rally 7% With Profit Seen Above Guidance, CEO Change
$Twilio(TWLO.US$ shares gained 7.1% after the company announced a change in leadership and said its fourth quarter revenue and profit will exceed the top end of its guidance given in November.
Crypto Stocks Jump as Bitcoin Spikes Nearly 7%
Crypto stocks jump as $Bitcoin(BTC.CC$ spikes nearly 7%. $Coinbase(COIN.US$, $Riot Platforms(RIOT.US$, $Marathon Digital(MARA.US$, $Bitfarms(BITF.US$ up 3.3%-9%.
Dell Technologies Shares Rise After JPMorgan Upgrade
$Dell Technologies(DELL.US$ shares were up more than almost 5% in recent trading Monday after JPMorgan upgraded the company's stock to overweight from neutral and raised its price target to $90 from $77.
Source: Bloomberg, Dow Jones, CNBC, Reuters
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