On 14 August 2024, after the latest Consumer Price Index (CPI) data revealed that inflation cooled slightly more than expected, we saw major U.S. equities indices ticked higher.
The key inflation gauge rose 2.9% over the year in July, a slight downtick from the previous month. This moderating CPI was welcomed by investors and consumers should be benefiting from it as they have been contending with outsized price increases and boosts the likelihood of the Federal Reserve moving forward with interest-rate cuts at its upcoming meetings.
The S&P 500 was up 0.38% on Wednesday, while the Dow added 0.61%. The Nasdaq Composite eked out a gain of less than 0.1% at 0.03%.
S&P 500 Financials and Energy Led The Sectors
On Wednesday (14 August), eight of the S&P 500 sectors managed to settle higher, with financials leading with +1.29%, followed by Energy and Information Technology with +0.66% and +0.61% respectively.
The biggest declines came from the communication services and consumer discretionary sectors reporting -0.91% and -0.41% respectively.
The financials sector was boosted by gains from $UBS Group AG(UBS)$ with +5.6% after they reported net profit of $1.1 billion, nearly double the $552.4 million consensus call. Another financials name $Charles Schwab(SCHW)$ also reported 4.6% after the company’s monthly activities report published on Wednesday showed that the financial-services firm brought in$29 billion in core net new assets for July, which is more than double asset-gathering levels of July 2023.
Note Yield Closed Slightly Mixed
The 10-year note yield closed flat at 3.84%, and the 2-year note yield up two basis points to 3.968%.Both was below 4% with CPI suggesting inflation cooling.
Stocks To Watch
Charles Schwab (SCHW) shares jumped 4.6% after the brokerage and financial services firm reported solid asset and customer gains for July. Core net new assets entering the firm reached $29 billion, more than doubling the figure from the same month a year ago. Schwab also added 327,000 brokerage accounts in July, up 8% year-over-year.
From the technical, we are seeing that SCHW have a nice upside movement formed by MACD, and with the KDJ giving quite a confirmed upside move as well.
I am expecting SCHW to trade higher over the next few days.
Shares of $Tesla Motors(TSLA)$ fell 3.1% on Wednesday, giving back a portion of the strong gains posted in the previous session. The EV maker's stock has been trending downward since the company reported a significant year-over-year decline in profits in its second-quarter results released last month.
$SIGA Technologies Inc.(SIGA)$ specializes in developing countermeasures to treat smallpox and related diseases, including Mpox. Its antiviral drug, TPOXX (tecovirimat), has been used to treat Mpox, especially in severe cases. The increased focus on Mpox due to the WHO’s declaration has likely driven up investor interest in SIGA’s stock as demand for treatments like TPOXX could rise.
From the technical, KDJ actually make a potential BUY signal 3 days ago, and we saw a MACD bullish crossover formed after the nice surge yesterday (14 August), I believe there will be more potential price movement.
I will be monitoring the price action for SIGA today (15 August) to catch a good trade.
Summary
With the CPI data suggesting that inflation is cooling, we might see investors coming back to financials stocks as well as the mega cap, I am expecting mega cap stocks to make some significant move today (15 August 2024).
Appreciate if you could share your thoughts in the comment section whether you think we could see good recovery from mega cap soon?
@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
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