Weekly: Jobs report and CES highlight the week after a shaky start
Last Week's Recap
The US Market - A shaky start to the new year
While the major averages continued to pull back on the first trading day of 2025. They lost three consecutive days at the end of 2024. The broad rally occurred on Friday, led by some of last year's winners. However, the rally was not enough to make the major averages winners over the holiday-shortened week. The S&P 500 finished the week down 0.48%.
Investors shouldn’t worry about the S&P 500′s negative start to 2025, The first trading day has been a very poor guide to the rest of the year in recent times, so we shouldn’t extrapolate things too far, according to Deutsche Bank.
The market cooled in the final weeks of 2024, but the averages are still not too far from record highs after a strong year for Wall Street. For December, the benchmark lost 2.5%, while the Dow was down 5.27%. The tech-heavy Nasdaq became the only positive average over December with a 0.48% up.
For 2024, the S&P 500 notched another year of double-digit gains, up 23.3% to end at 5,881.63. The benchmark built on a gain of over 24% in 2023, logging its best two-year performance since 1998. The Nasdaq surged 28.64%, while the Dow rose 12.88%.
The US Sectors & Stocks - TSLA lost nearly 10%
The S&P 500 Energy and utilities sectors were the winners during the week. Other sectors closed the week in the red. The consumer cyclical sector was the biggest loser as TSLA dropped nearly 10% after its Q4 deliveries missed estimates.
For 2024, The communication services sector was the top-performing S&P 500 sectors with a nearly 39% growth, followed by the information technology sector. Ten of the 11 sectors posted the year gains, with materials sector being the sole decliner.
Tesla (TSLA) reported fourth-quarter deliveries of 495,570, a new quarterly record, but below estimates of roughly 506,000. Tesla predicted full-year of 2024 deliveries would top 2023's total of 1.81 million. Instead, they fell for the first time, down 1.1% to 1.79 million.
Microsoft (MSFT) announced that it would spend $80 billion on AI-enabled data centers in fiscal 2025, and power producers have been boosted by the trend. Constellation Energy (CEG) and Vistra Energy (VST) were up 11% and 16%, for the week, respectively.
Nvidia (NVDA) rebounced 3.24% to stand above $140, as excitement about Nvidia's CES attendance grows. Analyst Vivek Arya of Bank of America maintained a "Buy" rating and $190 price target for Nvidia, suggesting that CEO Jensen Huang would reveal significant developments during his keynote speech.
Rivian (RIVN) jumped 20.8% last week after the EV maker beat expectations for deliveries and it said its production was no longer constrained by a component shortage. Rivian handed over 14,183 vehicles in the three months ended December. That was a 42% jump from the previous quarter and marked Rivian's highest deliveries in more than a year.
U.S. Steel (X) fell 6.5% Friday, after President Joe Biden said he would block the proposed acquisition by Nippon Steel.
A group of alcoholic beverage companies saw shares falling on Friday after U.S. Surgeon General Dr. Vivek Murthy issued a warning on cancer risk due to alcohol consumption. Diageo (DEO), Anheuser-Busch InBev (BUD) and Molson Coors (TAP) fell 4.3%, 3% and 4.4%, respectively.
MicroStrategy (MSTR) said on Friday that it is targeting a capital raise of up to $2 billion through one or more public underwritten offerings of perpetual preferred stock, which will be senior to its class A common stock.
Berkshire Hathaway continued its purchases of Verisign (VRSN) between Dec 31 to Jan 3, buying about $4.1 million of the company that provides Internet domain registry and other services. Berkshire now owns 13.3 million shares of Verisign, a roughly 14% stake worth about $2.7 billion.
Hong Kong Market - A turbulent start of the year
Hong Kong stocks had their worst start to a year since 2019. The Hang Seng Index (HSI) fell 2.2% on the first trading day of 2025. Stocks rebounded on Friday, as Chinese regulators ramped up support for institutional buying to shore up sentiment and rebuild investor confidence. However, the benchmark lost 1.64% for the week.
HSI ended 2024 with an 18% gain, snapping an unprecedented run of four consecutive years of declines, as investors bet China’s stimulus offerings. The implementation of specific stimulus policies will be in focus this year.
“The pattern of rangebound trading is expected to continue,” Bocom International said in a report on Thursday. “A breakout will depend on whether China’s economic fundamentals will improve in a sustainable way and how the pace of rate cuts overseas will be.”
Singapore Market - STI recorded a winning start
Singapore stocks notched a winning start to the new year, with the STI up 0.8%. Singapore’s economy grew at a solid clip last quarter, providing momentum for full-year growth to surpass expectations.
In 2024, the STI rose 17% and had its best year since 2016. The top three counters on the index were Yangzijiang Shipbuilding, DBS and Sats, which gained 100.7 per cent, 43.9 per cent and 32.4 per cent respectively.
For the year 2025, GDP is expected to grow by 4%, Prime Minister Lawrence Wong mentioned in his New Year’s message. Last year’s growth surpassed the government’s revised estimate of around 3.5%, building a strong foundation for the city state to confront challenges in 2025.
Australian Market - ASX gained to start the new year
Australian shares gained to start the new year, ending a two-day losing streak despite a weak lead-in from global markets. However, ASX 200 was down 0.14% last week to 8,250.50.
The benchmark Index recorded a 7.5% gain in 2024. That fell short of the index’s 7.8% gain in 2023. Among that, financials and information technology were the best-performing sectors in 2024.
The Week Ahead
Macro Factors - CES on focus
Another short trading week. The U.S. stock market will be closed on Jan. 9, in honor of former President Jimmy Carter, who passed away late last year.
In the week, a crucial run of labor market data is set to greet investors, with Friday's December jobs report is the week's most important release. The December jobs report is expected to show the US labor market added 153,000 jobs in the month, down from the 227,000 seen in November. Meanwhile, the unemployment rate is expected to hold steady at 4.2%.
The FOMC will release the minutes from its mid-December monetary-policy meeting on Wednesday. On Friday, the Supreme Court will hear arguments in the highly anticipated TikTok ban case.
The CES tech conference kicks off on Monday with a keynote speech from Nvidia CEO Jensen Huang. An analyst question and answer session is also slated for Tuesday. Nvidia is expected to announce new gaming products at the upcoming CES tech show, while investors will seek updates on the path of the company's generative artificial intelligence sales, Wedbush Securities said in a client note. Wedbush expects AMD (AMD) to unveil a number of new client compute products at the CES.
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