To The Moon

We saw the stock market rebounded on last Friday (20 Dec) after a week of sharp declines. The U.S. major indices ended the trading session above 1% due to above-average volume due to quarterly options/futures expiration.

Despite Friday's gains, indices experienced weekly losses ranging from 1.8% to 4.5% compared to the previous week Friday's close.

In the Dow, 23 out of 30 components ended in the green, led by NVIDIA (NVDA) up 3.1%, and UnitedHealth (UNH) up 2.2%. NIKE (NKE) down $0.16 or 0.2%, after disappointing fiscal Q3 revenue guidance.

Friday Economic Data Suggest Future Price Increases

Personal income rose 0.3% month-over-month in November, following a revised 0.7% increase in October. Personal spending increased 0.4% month-over-month, following a revised 0.3% increase in October. The PCE Price Index was up 0.1% month-over-month and rose to 2.4% year-over-year from 2.3% in October. The core-PCE Price Index also increased 0.1% month-over-month, holding steady at 2.8% year-over-year.

The final University of Michigan Index of Consumer Sentiment for December remained at 74.0, the same as the preliminary reading, compared to 69.7 a year ago. Consumers expect future price increases for large purchases, influencing current buying conditions.

Bonds and equities reacted positively to the Personal Income and Spending Report for November. Although inflation readings showed no improvement, the data was better than expected. The PCE Price Index rose to 2.4% year-over-year from 2.3% in October, while core PCE remained unchanged at 2.8%. Consensus estimates had anticipated 2.5% and 2.9%, respectively.

We are expecting the December Consumer Confidence Index will be released at 10:00 ET.

Note Yield Decline

We saw a decline in market rates where The 10-year yield fell five basis points to 4.519%, while the 2-year yield decreased by one basis point to 4.319%.

After the comments from Chicago Fed President Goolsbee, suggesting that rates "will come down a fair bit more." , we saw the market in an upward momentum.

S&P 500 Sector All Posted Gains

All 11 S&P 500 sectors posted gains, with seven sectors climbing over 1.0%. Leading sectors included real estate (+1.8%), utilities (+1.5%), information technology (+1.53%), and financials (+1.39%).

Stocks To Watch

$Qualcomm(QCOM)$ shares saw a 3.5% rise in extended trading following a federal jury's decision that the company did not breach a licensing agreement with Arm Holdings (ARM). The jury's ruling also confirmed that Qualcomm's custom CPUs, used in Microsoft (MSFT) PCs, are licensed legally under its existing deal with Arm. This verdict came after Arm sued Qualcomm over licensing disputes related to its acquisition of Nuvia.

Even with the 3.5% increase coming, I am cautious on QCOM as it is currently trading lower than the short-term and long-term MA, and it will take a pretty long time for QCOM to make a recovery back.

MACD is also making a bearish downside and MTF is showing a weak downward trend, so we will need to see QCOM giving us a very strong gap up.

$Pfizer(PFE)$ received an accelerated FDA approval for its drug Braftovi, which will be used in combination with other therapies as a first-line treatment for metastatic colorectal cancer with a BRAF gene mutation. This approval is contingent upon further verification of clinical benefits. The drug, also known as encorafenib, is approved for use with cetuximab and mFOLFOX6 chemotherapy for specific BRAF mutations.

The Consumer Financial Protection Bureau filed a lawsuit against JPMorgan Chase (JPM), Bank of America (BAC), and Wells Fargo (WFC), along with Zelle's operator, for allowing widespread fraud on the payment platform. The lawsuit claims that Zelle customers have lost over $870 million due to inadequate consumer safeguards.

$CME Bitcoin - main 2412(BTCmain)$ experienced a weekly decline of 4.3% as the Federal Reserve's hawkish stance led to a sell-off. Despite reaching a record high earlier in the week, Bitcoin's value fell below the $100K mark following the Fed's indication of fewer rate cuts in 2025.

In the semiconductor sector, J.P. Morgan analysts have highlighted Broadcom (AVGO) as a top stock for 2025, citing strong demand for its AI infrastructure solutions. The analysts set a price target of $250, emphasizing Broadcom's impressive AI revenue growth.

In the technology sector, OpenAI introduced its latest AI models, o3 and o3-mini, which surpass previous benchmarks. $Microsoft(MSFT)$ OpenAI's new models are designed for increasingly complex tasks, including advanced programming and scientific computations.

$Samsung Electronics Co., Ltd.(SSNLF)$ secured a $4.745 billion grant under the U.S. CHIPs Act for developing semiconductor facilities in Texas, reinforcing its position as a leading-edge chip manufacturer alongside Intel (INTC)) and Taiwan Semiconductor (TSM).

Summary

As we have a shorter week of trading, I would think the market might be trading in a mixed mode, with some stocks making a dash for santa rally, but this might be an opportunities for us to find some of the stocks that we would like to add or remove in our strategy.

For 2025, we might experienced some volatility before Trump administration take office, but will the trump rally return after that, I think we can look at the semiconductor space and the EV space.

Appreciate if you could share your thoughts in the comment section whether you think market would be trading in a mixed mode.

@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.