S&P 500 Snaps Losing Streak Ahead of Big Tech Earnings 💰

Today's Agenda

Good Morning Invstrs, I am Nora Lee, and on todays Invstr Crunchwe will be discussing the S&P 500 snapping its losing streak and the NYSE considering 24/7 trading.

You can listen to the latest podcast on the Apple and Spotify app!

MARKETS

S&P 500 Snaps Losing Streak Ahead of Big Tech Earnings

US stocks rebounded on Monday, snapping a six-day losing streak in the S&P 500. AI favorite Nvidia rebounded by 4% yesterday. More than 30% of the S&P 500 companies report this week, with mega caps Meta, Microsoft and Alphabet all reporting. The markets will be watching the health of the tech industry closely, for further signs of a catalyst to restart a rally.

Fridays PCE inflation figures will be important, as markets keep their eyes on inflation. Economists expect it to come in at 2.7%. The Financial Times notes investors are now pricing in a 20% probability of a Fed rate rise, as per the activity in the options market. However, the base case is still 1-2 Fed cuts this year.

I am keeping my eyes on the WIRE war, inflation, rates, and earnings!

MARKETS
Market Recap - 22nd April

As investors bought the dip, markets ended up on Monday with the S&P 500 gaining 0.87% to close at 5,010.6 and the NASDAQ up 1.11% to close at 15,451.311 while the Dow Jones Industrial Average gained +0.67% to close at 38,239.98. The VIX closed down at 16.94.

Today we are watching Tesla and GM. Tesla will announce its earnings today after the closing bell and investors expect earnings per share of $0.52 on top-line revenue of $22.31 billion, per Bloomberg consensus estimates. This would be the first decline in four years and follows on from a spate of bad news for the EV maker which has lost 43% this year. The stock closed -3.4% yesterday at $142.05.

GM is expected to report its earnings this morning with topline revenue of $42.09 billion and $2.12 in adjusted earnings per share as per Bloomberg consensus. Investors will be watching the guidance to GMs 2024 outlook as it is expected they could raise guidance this quarter, according to Deutsche Banks Emmanuel Rosner. The stock closed up 1.98% yesterday at $43.21.

MARKETS

NYSE Contemplates Round the Clock Trading

As Bitcoin trades 24/7, the New York Stock Exchange is now considering the merits of trading stocks around the clock. Market participants will be polled for their views on the potential move. The survey by the NYSE was put out by its data analytics team. 24/7 trading is a hot topic off the back of retail investor activity during the pandemic and stock exchanges are seen as a laggard compared to US Treasuries, major currencies and leading stock index futures which are traded around the clock from Monday to Friday.

Some brokers already offer 24-hour weekday access to US stocks, via a dark pool. The survey has asked respondents if they want round-the-clock trading on weekends or just five days a week. Famous hedge fund Point72 Ventures, backed by Steve Cohen, is seeking SEC approval to launch the first round-the-clock exchange called 24X. While institutional interest in overnight trading is light, it is primarily driven by poor liquidity and concerns around settlement risk. The committee that oversees the consolidated tape has begun meeting to consider the merits of 24-hour trading.

What do you think, do you just want a good nights rest before digesting market news the next day?

Special Mention

Todays special mention goes out to T. Rowe Price, founder of T. Rowe Price investment management firm, who famously said, Earnings of most corporations pass through a life cycle which, like the human cycle, has three important phases growth, maturity, and decadence.

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