The Week on Wall St<\/p>\n
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Wall Street\u2019s at record highs.<\/p>\n
Last week was just another five sessions trading on the knife\u2019s edge.<\/p>\n
The S&P500 ended on Friday looking spritely at its fourth straight record high thanks muchly to more tech earnings you could fall in love with and a blockbuster jobs report to close out the week.<\/p>\n
By the numbers, the S&P500 and Dow Jones\u00a0 each put on a circa 1.4% gain, while the tech heavy Nasdaq Composite collected 1.1%.<\/p>\n
Wall Street\u2019s latest record high followed Friday\u2019s blowout payroll report which ticked the Confidence in the Economy box, despite adding weight to the Fed\u2019s Wait and See caution.<\/p>\n
The blockbuster Friday jobs data also drummed up trader confidence in the outlook for corporate activity. Which naturally sparked yet another wildfire rally across tech stocks, with the accelerant provided this time by Meta\u2019s surprise first-ever quarterly dividend, which saw the stock\u00a0 jump by almost a full quarter of market value before the end of the session.<\/p>\n
In the same time, Amazon added 8.3% after its own quarterly bonanza.<\/p>\n
No surprise then that the US Tech100 closed the week at an all-time high of 17680.<\/p>\n
It\u2019s up 8% in four weeks, 41% in 12 months.<\/p>\n
The theme over yonder now appears to be equal parts interest rate cycle and underlying strength of the US economy.<\/p>\n
Bond yields had driven equities post-COVID, but US earnings season became the new driving factor last week, no real surprise by the baton change on the stock level, but the moves have been extraordinary, propelling US indices higher.<\/p>\n
Meta\u2019s 21% surge on Friday made Chief Zuckerburg around $US28bn in one day, a rare move for a stock of this magnitude but we did see Nvidia pop over +24% last May.<\/p>\n
\u201cThe Magnificent Seven are still a rule unto themselves,\u201d says Market Matters\u2019 boss James Gerrish,<\/p>\n
\u201cIt is not often the crowd gets so well rewarded, but as last month\u2019s Bank Of America Fund Managers Survey told us, the large-cap US tech stocks were the most crowded place to be invested; so far, so good!\u201d<\/p>\n
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They ran this town in 2023, yet cracks are starting to appear in the unity of Wall Street\u2019s Magnificent 7.<\/p>\n
\u201cOf the (mega tech stocks), last week we saw Meta Platforms, Nvidia, Amazon.com, Alphabet, and Microsoft all make fresh all-time highs while Apple Inc and Tesla struggled, plus Alphabet (GOOGL US) had reversed lower come Friday.\u201d<\/p>\n
In other words, James says, it\u2019s become the \u201cDominant Four\u201d.<\/p>\n
Leader of the posse last year was new kid Nvidia \u2013 the AI chip maker came away with a 240% gain. Followed at some distance (and in descending order) by Messrs Meta, Tesla and Amazon \u2013 each walking away with 195%, 101% and 80%.<\/p>\n
Last week, Meta surged after their results beat analyst expectations, and they delivered the company\u2019s first-ever quarterly dividend, plus a $US50bn share buyback program \u2013 \u201cgreater than the entire market cap of Macquarie Group (ASX:MQG)<\/strong><\/a>\u201c, Gerrish points out, with some delight.<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n So it was really these four tech stocks which propelled the S&P500 to fresh all-time highs last week.<\/p>\n However, Gerrish says that the firming greenback and a pretty convincing show from Beijing that it might not be able to meaningfully turn China\u2019s economy around has led to \u201cthe elastic band between the Tech and Materials sector stretching even further.\u201d<\/p>\n \u201cIt will snap one day, but the million dollar question remains when? We have been looking for outperformance from the US Tech Sector to reverse in 1Q of 2024, but there are no signs yet\u2026\u201d<\/p>\n \u00a0<\/p>\n The coming week brims with pivotal events likely to steer the financial markets, starting with Federal Reserve Chair Jerome Powell\u2018s address on Monday. This speech holds significant weight for investors parsing the tea leaves for hints on US monetary policy.<\/p>\n And US Q4 corporate earnings season are now in full swing.<\/p>\n According to Jean Boivin, head of the BlackRock Investment Institute, whichever way the numbers drop from now, the market is hungry for any glass-half-full opportunity.<\/p>\n \u201cWe don\u2019t see (corporate earnings this week) spoiling upbeat risk appetite for now,\u201d Boivin says.<\/p>\n \u201cThe S&P 500 hit an all-time high last week as most top tech firms beat high earnings expectations. Yet we think earnings will recover less than markets expect this year after stagnating in 2023. Tech gains and cost cutting have buoyed margins, but we see pressures mounting over time.<\/p>\n \u201cWe\u2019re overall overweight US stocks as we think rosy market sentiment can persist for now.\u201d<\/p>\n More of BlackRock\u2019s barely hidden excitement, here.\u00a0<\/a><\/p>\n \u00a0<\/p>\n The Wall Street Journal is reporting \u2013 to the delight of Elon Musk acolytes everywhere \u2013 that the Tesla\/X\/ Space X et al boss has quite the penchant for drug use and that his various board members are feeling a little put upon that they might have to get stuck in when he does.<\/p>\n Unnamed sources told the Journal that Elon\u2019s had a go at (checks notes)\u2026 LSD, cocaine, ecstasy and magic mushrooms, usually at private soirees and one of the (less exciting effects) is that some directors at Musk\u2019s various, trippy companies felt a weight of \u201cexpectation\u201d to use the drugs with him.<\/p>\n Citing mysterious people familiar with the flamboyant billionaire and his flamboyant companies, the WSJ suggests that it was the various financial ties to Musk\u2019s companies which kept those directors from saying no. Rather than, I don\u2019t know, the law, or health reasons\u2026 or even how weird it would be to see the entire board of Tesla tripping off their noggins and wandering unhinged around the Musk family home.<\/p>\n Said people told the newspaper that Elon\u2019s drug use is no momentary experiment but an ongoing ritual. The good news is that his apparent preference for the horse tranquiliser ketamine is legit, because \u2013 as the man himself said back in August \u2013 he\u2019s got a prescription for it, as an antidepressant.<\/p>\n It seems the tipping point \u2013 for SpaceX executives at least \u2013 was when a particularly high Elon floated in to a \u201ccringeworthy\u201d company-wide meeting about an hour late, where he lasted 15 minutes \u201crambling and slurring his words\u201d before the meeting was taken over by someone currently on the right planet.<\/p>\n Good goss.<\/p>\n Meanwhile, Elon\u2019s finding some solid support to get his Tesla remuneration back. Here\u2019s Cathie Wood, the founder of Ark Invest:<\/p>\n Thank you https:\/\/t.co\/yvyhCrJ7Q2<\/a><\/p>\n \u2014 Elon Musk (@elonmusk) February 5, 2024<\/a><\/p>\n\n Nice. Touching moment.<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Tuesday\u00a0<\/strong><\/p>\n Prudential Financial, Chipotle, Ford, Eli Lilly, GE Healthcare Tech<\/p>\n Wednesday\u00a0<\/strong><\/p>\n The Walt Disney Co, Wynn Resorts, PayPal, Yum! Brands, Hilton, Uber Technologies, Costco<\/p>\n Thursday\u00a0<\/strong><\/p>\n Motorola Solutions, Expedia Group, Ralph Lauren, T. Rowe Price Group, ConocoPhillips, The Hershey Co, Philip Morris, Tapestry<\/p>\n Friday<\/strong><\/p>\n PepsiCo<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n TUESDAY<\/strong> WEDNESDAY<\/strong> THURSDAY<\/strong> FRIDAY<\/strong> \n<\/span><\/p>\n The post TECH HEAVY: The Magnificent Seven has suddenly become the Fantastic Four<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"MM is now cautiously bullish toward META<\/h2>\n\n
MM is looking for the performance baton to reverse in 2024<\/h2>\n\n
\u00a0The Week Ahead<\/h2>\n
Elon Watch<\/h2>\n
US Earnings Highlights<\/h2>\n
Tuesday February 6 \u2013 Friday February 9<\/h2>\n
The Economic Calendar<\/h2>\n
Tuesday February 6 \u2013 Friday February 10<\/h2>\n
\nJapan Household Spending (Dec)
\nPhilippines Inflation (Jan)
\nGermany Factory Orders (Dec)
\nTaiwan Inflation Rate (Jan)
\nEurozone Retail Sales (Dec)
\nGlobal Sector PMI* (Jan)<\/p>\n
\nJapan Leading Index (Dec)
\nGermany Industrial Production (Dec)
\nThailand BoT Interest Rate Decision
\nUK Halifax House Price Index (Jan)
\nFrance Trade (Dec)
\nTaiwan Trade (Jan)
\nBrazil Retail Sales (Dec)
\nMexico Consumer Confidence (Jan)
\nCanada Trade (Dec)
\nUnited States Trade (Dec)
\nGlobal Metal Users and Electronics PMI (Jan)<\/p>\n
\nTaiwan, Indonesia Market Holiday
\nJapan Current Account (Dec)
\nChina (Mainland) CPI, PPI (Jan)
\nIndia RBI Interest Rate Decision
\nBrazil Inflation (Jan)
\nMexico Inflation (Jan)
\nUnited States Initial Jobless Claims
\nUnited States Wholesale Inventories (Dec)
\nUnited Kingdom KPMG \/ REC Report on Jobs (Jan)<\/p>\n
\nChina (Mainland), South Korea, Taiwan, Hong Kong SAR (partial), Singapore (partial): Market Holiday
\nGermany Inflation (Jan,)
\nCanada Unemployment (Jan)<\/p>\n