High Macro Volatility, German PMI Down, Earnings Mixed | MarketReader Minute

January 24, 2024

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

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Wednesday, January 24, 2024

The overall market is currently experiencing high macro volatility.

Some of the largest moves in the market today include:

German economic indicators showed mixed signals with the Services PMI falling to 47.6, indicating a contraction in services activity at its fastest pace in five months and missing market expectations. The Composite PMI also declined, suggesting an accelerated private sector contraction; however, Manufacturing PMI rose above forecasts to 45.4 despite continued output decline but signaling some easing of manufacturing woes.

In broader market news, investors are recalibrating their Federal Reserve rate cut expectations for May rather than March after digesting U.S. data including a dip in the Richmond Fed Index contrasted by improved Services figures and awaiting key releases such as US Advance Q4 GDP numbers and December PCE index—a critical inflation gauge for the Fed—due this week.

UK’s robust flash purchasing managers’ index pushed bond yields higher amid speculation that interest rates may stay elevated longer affecting global fixed income markets while bolstering sterling against major currencies.

China’s reserve requirement ratio cuts reflect concerns about domestic sentiment even as analysts call for structural reforms amidst these macroeconomic challenges.

AI-generated summaries of notable premarket ETF moves:

ISHARES RUSSELL 2000 ETF | IWM $198.35 +1.3%
The iShares Russell 2000 ETF (IWM) has moved up by +1.3% since the previous close, potentially influenced by positive market sentiment driven by the S&P 500 reaching a record high and strong performance in the technology sector with upbeat Netflix results. Investor optimism is likely contributing to movement in small-cap stocks represented by IWM. Additionally, there may be a correlation between IWM and the S&P 500 Index, which saw a return of +0.44%.

US DOLLAR INDEX | USDX/USD $102.99 -0.6%
The US Dollar Index has declined by 0.6% since the previous close, potentially influenced by positive UK PMI data and mixed U.S. economic indicators. Additionally, developments related to China’s stimulus measures and risk appetite may have indirectly affected USD movements within this currency basket. The negative return in USD/JPY could also contribute to the downward move in the index.

AI-generated summaries of notable premarket stock moves:

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(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)

Dupont De Nemours Inc | DD $66.22 -11.3%
Materials, Specialty Chemicals
Dupont De Nemours Inc’s stock has moved -11.3% since the previous close due to weak financial results and guidance for both Q4 2023 and Q1 2024, citing a weakening Chinese economy, inventory destocking within its industrial businesses, and continued weak demand in China as key factors behind the disappointing numbers.

Netflix Inc | NFLX $544.80 +11.0%
Communication Services, Movies & Entertainment
Netflix Inc’s stock price has increased significantly since the previous close. This can be attributed to strong fourth-quarter sales, with revenue beating estimates and showing a substantial YoY increase. Additionally, Netflix added more subscribers than expected during Q4, surpassing analyst expectations by a wide margin. The company also provided optimistic guidance for its EPS and revenue in Q1 2024. These positive developments have contributed to the outperformance of Netflix compared to its sector peers and may explain the upward movement in its stock price.

TE Connectivity Ltd | TEL $141.12 +4.8%
Information Technology, Electronic Manufacturing Services
TE Connectivity Ltd’s price has moved up 4.0% since the previous close, likely in response to their Q1 earnings report that beat expectations with higher EPS of $1.84 and improved profit margins due to cost-cutting efforts and price increases. Despite slightly lower revenues caused by destocking in certain industrial sectors, investors are optimistic about TE Connectivity’s future performance as they set guidance for Q2 EPS at a similar level.

Kimberly-Clark Corp | KMB $119.50 -4.3%
Consumer Staples, Household Products
Kimberly-Clark Corp’s stock has dropped -4.5% as the company reported lower-than-expected Q4 adjusted EPS of $1.51 and sales of $4.97 billion, missing estimates by 1.95% and 0.20%, respectively.

Freeport-McMoRan Inc | FCX $40.50 +6.2%
Materials, Copper
Freeport-McMoRan Inc’s stock has moved +5.2% since the previous close, potentially driven by better-than-expected Q4 EPS and sales results as well as positive guidance for future consolidated sales. Additionally, an increase in Copper prices may have influenced the stock price movement due to its correlation with Freeport-McMoRan’s performance.

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