Monday, February 5, 2024
The overall market is currently experiencing normal macro volatility.
The market is currently anticipating several key economic indicators that could influence investor sentiment and policy decisions. Firstly, the US ISM Services PMI data release today will be closely watched for insights into employment trends following a significant drop in the previous month’s employment index.
Secondly, on Thursday this week, investors are looking to assess labor market resilience through the latest figures on US Jobless Claims.
Lastly, global markets have reacted negatively to a robust U.S jobs report coupled with comments from Federal Reserve Chair Jerome Powell which dampened expectations of early rate cuts by the Fed; this has led to sell-offs in Asian stock markets and rising bond yields.
AI-generated summaries of notable premarket ETF moves:
US 30Y TREASURY | USB30Y/USD $120.58 -1.1%
The US 30Y Treasury’s price moved down significantly (-1.1%) due to stronger-than-expected US job data, leading to an uptick in the USD. Additionally, indications of higher interest rates for a longer period by the Federal Reserve affected bond yields. The market sentiment regarding rate cuts in 2024 has also been trimmed down, further supporting potential increases in treasury yields amidst correlated movements with other closely related treasury securities (such as the -0.36% movement of the US 5Y Treasury).
MATERIALS SELECT SECTOR SPDR FUND | XLB $81.56 -1.9%
The Materials Select Sector SPDR Fund’s price has declined significantly, potentially due to the negative performance of Air Products and Chemicals Inc (-8.8%) caused by lower sales and missed earnings estimates. The decline in Freeport-McMoRan Inc (-1.6%) may have also contributed to this movement.
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)
Air Products and Chemicals Inc | APD $226.00 -12.5%
Materials, Industrial Gases
Air Products and Chemicals Inc’s stock has dropped significantly by -11.7% since the previous close, following disappointing Q1 earnings report with lower EPS of $2.82 vs expected $3.0 and revenues at $3B vs expected 3.2B. The company also provided a lower-than-expected EPS guidance for Q2 2024. Lower helium demand, cost headwinds from China project sale, and currency devaluation in Argentina were cited as reasons. Market context shows underperformance compared to sector peers.
Estee Lauder Companies Inc | EL $157.09 +16.3%
Consumer Staples, Personal Care Products
Estee Lauder Companies Inc’s stock price has surged 15.4% since the previous close, driven by strong Q2 earnings that exceeded expectations and higher revenues. The company also announced a restructuring program to reduce costs and boost margins. Despite job cuts, Estee Lauder maintains an optimistic outlook for increased net sales in Q3 and expects organic growth in mainland China and Asia travel retail. This positive news has contributed to the stock’s outperformance compared to its sector peers.
Caterpillar Inc | CAT $329.75 +4.7%
Industrials, Construction Machinery & Heavy Transportation Equipment
Caterpillar Inc’s stock price rose +4.4% due to higher than expected Q4 earnings of $5.23 per share and revenues at $17.1B, beating expectations on both fronts. The company reported a strong demand for its construction equipment and effective cost controls that offset inflationary pressures. In comparison with sector peers, Caterpillar seems to be outperforming the market since the previous close.
McDonald’s Corp | MCD $290.35 -2.2%
Consumer Discretionary, Restaurants
McDonald’s Corp reported mixed Q4 earnings, beating EPS estimates but missing on revenue. Sales were up 12% and global comparable sales increased by 3.4%. The company attributed the lower than expected revenues to conflict in the Middle East impacting regional sales, which is expected to continue affecting systemwide sales as long as the war persists. US same-store sales rose due to effective marketing strategies and loyalty programs generating higher prices rather than increased traffic volume.
Loews Corp | L $77.89 +7.2%
Financials, Property & Casualty Insurance
Loews Corp’s stock price has gained +6.8% since the previous close. The company reported Q4 earnings with EPS of $1.99 and revenue of $4.3B, a 12% YoY increase in revenue. Book value per share also increased from $75.78 to $81.92 YoY excluding AOCI (Accumulated Other Comprehensive Income). Over the past five years, Loews Corp’s stock price has risen by 58%. This outperformance is notable compared to its sector peers.