To The Moon

Yesterday's session witnessed a mixed performance in the stock market.

DJIA: +0.35% to 38,467.31 - S&P 500: -0.06% to 4,924.97 - Nasdaq: -0.76% to 15,509.90

While the Dow Jones Industrial Average achieved a new record high, the $NASDAQ(.IXIC)$ experienced a decline, primarily driven by the tech sector. Despite strong anticipation for Big Tech earnings, which commenced during the session, traders appeared to position themselves for a potential sell-off following the announcements.

Initial after-hours trading saw $Microsoft(MSFT)$ and $Alphabet(GOOG)$ beating earnings estimates but witnessing stock price declines due to perceived weaknesses in their reports.

Similarly, $Advanced Micro Devices(AMD)$ faced a decline after its results, signaling cautious investor sentiment.

Active stocks

Market Scenario

The Federal Reserve’s latest policy decision is ahead, with an expectation it will hold interest rates steady and avoid signaling any imminent plans for a first cut. The majority of Fed officials have pushed back on the market betting on a first cut coming in March, a 40% chance of which is still being priced in. Chair Jerome Powell, who will hold a press conference following the decision, may use that to reiterate the message that while recent declines in inflation are encouraging, there is little urgency to start cutting given ongoing labor market strength and robust economic growth.

First cut coming in March, a 40% chance

FOMC

ADP releases its National Employment Report for January. Expectations are for the economy to add 145,000 private-sector jobs, 19,000 less than in December.

The current market scenario is characterized by a continued emphasis on the performance of the technology sector, which has been a key driver of market gains.

Highest Open Interest

OI

However, recent earnings reports from major tech companies have shown mixed results, leading to market volatility and potential sell-offs.

Investors are closely monitoring upcoming earnings announcements from other tech giants like $Apple(AAPL)$ , Amazon.com, and Meta Platforms, anticipating their impact on market dynamics. Additionally, there is growing attention on potential contrarian perspectives, such as the sustainability of tech stock rallies and the implications of diverging returns among non-U.S. tech stocks.

Conclusion

In conclusion, yesterday's market session reflected mixed sentiments, with the tech sector facing downward pressure despite strong earnings beats from some major players.

This highlights the cautious stance of investors and the potential for increased volatility in the market.

Looking ahead, upcoming earnings reports and macroeconomic indicators will continue to influence market trends, with investors advised to consider various perspectives and remain vigilant in their investment strategies.

*Disclaimer: The information provided is based on available data and market analysis as of the time of writing, and future market movements may vary.*

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