Daily Market Report October 15th, 2024
After a lower start of 80 points as indicated by the earlier stock index futures, theDow then exploded upward yesterday to finish with a closing advance of 201 upto 43, 065 led by gains in AAPL, CRM, GS, HD, MSFT, TRV and UNH.
TheS&P climbed by 45 up to 5860, also its best close ever, led mainly by gainsin the large technology stocks while the Nasdaq advanced by 160 up to 18, 502 ledby NVDA which actually reached an intraday record all after its negative twistsearlier in the summer plus AAPL and pathetic TSLA had the nerve to gain a pointafter its robotaxi destruction last week.
TheRussell 2000 Index of small stocks got dragged higher by 14 to 2248 while theVIX eased back to 19.70 despite all of the Middle Eastern tensions.
Thefirst two indices are coming off their fifth straight winning weeks and are on track for their longest weekly winningstreaks of the year.
Thegains followed relatively quiet trading in Europe, while the U.S. bond marketremained closed for the day because of a holiday.
Thestrongest action in global markets came from China, where the finance ministergave plans for the world’s second-largest economy. The government is looking atadditional ways toboost the economy but stopped short of unveiling amajor new stimulus plan that investors were hoping for. This is the reason thegroup is selling off sharply once again today.
Crudeoil prices, meanwhile, sank roughly 2% on worries about demand from China’sslowing economy.
Hopesfor big stimulus in China have sent Chinese stocks sharply higher recentlyafter they languished for years. But investors are skeptical about how much itcan remake and restore the economy.
Besidesoil, prices also fell for copper and other commodities that a healthy Chineseeconomy would devour. That helped drive down prices for miners, such as FMC, whichfell 2.3% for one of the larger losses in the S&P.
BAlost in its first trading since they warned thatit expects to report that it burned through $1.3 billion in cash during thelatest quarter and lost $9.97 per share and also said it was laying off 10% ofits workforce as it tries to deal with a labor strike that is cripplingproduction of the company’s best-selling airline planes.
Onthe winning side was SOFI which rose by 11% after announcing a $2 billion loanplatform agreement with investment firm Fortress Investment Group, where thecompany will refer pre-qualified borrowers.
LBPHsoared by 52% after H. Lundbeck, a Danish company, said it would buy thebiopharmaceutical company in an all-cash deal valuing it at $2.6 billion.
Analystsare looking for S&P companies to deliver overall growth of 4.1% in earningsper share for the latest quarter from a year earlier, according to FactSet. Ifthey are correct, it would be a fifth straight quarter of growth.
Solid,continued growth in profits for companies would help tamp down criticism that’sbuilt up about how expensive the broad stock market looks, after share pricesran higher faster than earnings.
Stockshave broadly rallied to records on relief that interest rates are finally heading backdown, now that the Federal Reserve haswidened its focus to include keeping the economy moving instead of justfighting high inflation.
Recentreports showing a better economy have also raised optimism that the Fed canpull off a perfect landing where it gets inflation down to 2% without causing arecession that many had thought would be necessary.
This week starts the main part of 3Q earnings results with the following lineup: today - BAC, SCHW,C higher in addition to Dow component GS while JNJ and UNH are lower; tonight –PNC, JBHT and IBKR; Wednesday – DSC, MS and USB, ASML, ABT; Thursday – BLK, Truist, ISRG, NFLX and TWS and Dow component TRV on Thursday; Dow components AXP and PG plus SLB on Friday.
Economic reports will see: today – October N.Y. State Empire Manufacturing Survey fell by 11.9%Thursday – September retail sales, weekly jobless claims, September industrial production; Friday – September housing starts.