Chinese Stimulus, Central Banks, Earnings Drive Stocks | MarketReader Minute

January 23, 2024

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Below are AI-generated insights on today’s premarket moves, powered by MarketReader technology.

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Tuesday, January 23, 2024

The overall market is currently experiencing normal macro volatility.

Some of the largest moves in the market today include: Ethereum has experienced an extreme move of -4.6%. USD/CNH has experienced a large move of -0.4%. Bitcoin has experienced a large move of -1.6%. 

The Bank of Japan has maintained its key short-term interest rate at -0.1% and the 10-year bond yield target around 0%, a decision that was unanimously voted on and widely anticipated, reflecting their ongoing commitment to negative rates and Yield Curve Control despite adjusting inflation forecasts for fiscal years down to +2.4% from +2.8%, while slightly raising it for 2025 to +1.8%.

Meanwhile, China’s ¥2 trillion intervention in its stock markets aims to boost confidence after underperformance relative to global benchmarks over the past year; this move immediately bolstered mainland stocks, Hong Kong equities, and strengthened the yuan against other currencies.

Investors are also focusing on central bank activities across major economies as these policies have significant implications for regional financial stability—Japan’s steady policy stance being a case in point with considerable influence over Asian markets.

Attention is now turning towards upcoming economic data releases such as US PMIs followed by Advance Q4 GDP figures alongside jobless claims numbers mid-week leading up until Friday when US PCE report will be released – critical indicators expected provide insights into America’s economic health amid debates about Federal Reserve monetary policy direction.

AI-generated summaries of notable premarket ETF moves:

ISHARES CHINA LARGE-CAP ETF | FXI $21.81 +3.1%
The iShares China Large-Cap ETF has risen +3.1% due to positive sentiment surrounding government actions to stabilize the capital market and enhance its stability, including plans for a stabilization fund of 2 trillion yuan ($278 billion) sourced from offshore accounts of state-owned enterprises. Additionally, authorities intend to invest at least 300 billion yuan in onshore shares through China Securities Finance Corp or Central Huijin Investment Ltd., aiming to restore investor confidence amid recent stock market decline.

ETHEREUM | ETH/USD $2186.5 -5.5%
The price of Ethereum (ETH) has dropped significantly (-5.0%) due to Celsius Networks liquidating its ETH holdings as part of bankruptcy proceedings, triggering selling pressure and concerns about further declines if support levels aren’t maintained. Large transfers of ETH to exchanges by Celsius Networks have intensified the selling pressure. However, decreasing funding rates suggest optimism in the market for a potential rebound once selling pressure subsides.

AI-generated summaries of notable premarket stock moves:

Open MarketReader to see more.
(Even if you don’t have an account, you can still see real-time summaries of the top 6 most unusual asset moves at the moment)

3M Co | MMM $99.42 -8.0%
Industrials, Industrial Conglomerates
3M Co’s stock has moved down significantly since the previous close. Although they reported stronger-than-expected earnings for Q4 2023, their guidance for FY 2024 fell short of Wall Street predictions. This may have contributed to the price decline as investors had higher expectations for future performance.

Procter & Gamble Co | PG $152.40 +3.0%
Consumer Staples, Household Products
Procter & Gamble Co’s price has increased +2.4% since the previous close, possibly due to better-than-expected Q2 earnings with higher EPS of $1.84 (vs expected $1.70) and a maintained outlook for organic revenue growth at 4%-5%. Despite slightly missing sales estimates, P&G raised its profit guidance for FY2023, which could be driving investor optimism in the stock compared to its sector peers.

United Airlines Holdings Inc | UAL $41.00 +6.7%
Industrials, Passenger Airlines
United Airlines Holdings Inc’s stock price has moved up significantly since the previous close. This could be driven by their better-than-expected Q4 earnings, with adjusted EPS of $2.00 beating estimates and revenue surpassing expectations as well. The company also provided guidance for Q1 2023 indicating an expected loss wider than anticipated but forecasted a higher full-year 2024 adjusted EPS range compared to analyst estimates. Additionally, United Airlines seems to be outperforming its sector peers which may contribute to the positive market sentiment surrounding the stock.

Verizon Communications Inc | VZ $41.35 +4.5%
Communication Services, Integrated Telecommunication Services
Verizon Communications Inc’s stock has surged +4.7% due to strong Q4 earnings, beating revenue and EPS estimates. The company also provided an upbeat outlook for 2024 with higher expected annual adjusted profit per share than analysts’ average estimate. Verizon’s total wireless postpaid net additions increased by 26% YoY in 2023, further supporting positive sentiment.

DR Horton Inc | DHI $149.50 -5.2%
Consumer Discretionary, Homebuilding
DR Horton Inc’s stock moved -5.0% since the previous close, likely due to its mixed Q1 earnings report. Despite beating revenue estimates with $7.73 billion in sales, DR Horton missed EPS expectations at $2.82 per share compared to an estimate of $2.88 per share and experienced a decline in homebuilding gross margins due to higher incentive loads offsetting gains from higher home sales.

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