Tech-Led Rally as Inflation Concerns Ease
Yesterday's Session
-Positive Start: Monday saw a positive start to the week for U.S. stocks, with the $NASDAQ(.IXIC)$ leading the gains by closing 2.2% higher. The $S&P 500(.SPX)$ rose 1.4%, while the $DJIA(.DJI)$ increased by 0.6%. However, $Boeing(BA)$ 's 8% decline, triggered by the FAA grounding 737 Max 9 planes, limited the Dow's performance.
Index Perf
$NVIDIA Corp(NVDA)$ just got done announcing its mid-generation refresh of its graphics cards, but to say that's all the tech company had in store for CES 2024 wouldn't even be telling half the story.
$Apple(AAPL)$ has announced it will start shipping its Vision Pro headset on February 2nd in the United States. Pre-orders begin January 19th at 8AM ET...
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Key Events:
Inflation Sentiment: According to the New York Fed’s Survey of Consumer Expectations, Americans now expect inflation to be at 3% a year from now, marking the lowest reading in three years. Consumers also anticipate smaller inflation gains for the three-year and five-year outlook. This sentiment contrasts with economists' expectations of a slight reacceleration in December's Consumer Price Index (CPI).
Fed Governor's Caution: Fed Governor Michelle Bowman emphasized a cautious stance on monetary policy. Despite market hopes for rate cuts, Bowman stated that inflation has not slowed enough to consider such measures. She highlighted persistent upside inflation risks that warrant careful consideration.
Oil Price Drop: Oil prices experienced a sharp decline as Saudi Arabia's decision to cut its official selling price for oil exports in February raised concerns. The move was interpreted as a sign of struggles to sell all production and reluctance to sacrifice market share to support prices.
Market Scenario:
Rate Cut Hopes: Investors are optimistic about a year marked by rate cuts, buoyed by consumer expectations of lower inflation. However, some Fed officials, including Bowman, remain cautious, emphasizing the need to monitor inflation trends closely.
Hope
Monday's session witnessed a tech-led rally, particularly in the Nasdaq, as the sector rebounded from last week's selloff. Companies like Salesforce and Intel played a key role in boosting the Dow.
With the market closely monitoring inflation data and anticipating rate cut possibilities, investors remain vigilant for signs of economic stability or potential adjustments to monetary policy.
*Disclaimer: The market outlook is subject to change based on evolving economic indicators and geopolitical developments.*
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