SPY All time highs have become a routine occurrence in 2024 thanks to optimism around artificial intelligence and the growth it offers. Semiconductor companies have especially been in the spotlight as their earnings exponentially exceed expectations as chip demand grows. Last week’s earnings report from Nvidia fueled buying confidence and propelled markets higher, but there will be another major test this week from the economic front. The PCE report, which is The Fed’s preferred inflation gauge, will be released on Thursday and investors are eager to see the results it brings. January’s CPI report reflected higher inflation than expected, so there’s a good chance we’ll see the same result on the PCE report. The market rally we’ve seen since October...
SPY Chart done on hourly timeframe. Stocks wavered last week after data from the latest CPI and PPI reports showed inflation increased on both the consumer and producer index in January. The newly released inflation numbers are likely to guarantee that there will be no interest rate cut in the coming FOMC meeting, but this week’s Minutes Report will add more clarity to where Federal Reserve Members stand on interest rates. Also on watch this week will be earnings from Nvidia, Home Depot, and Walmart. Nvidia’s earnings are especially important because it has become the face of artificial intelligence, so its report will impact the entire industry. Technical analysis: Despite the sharp decline markets saw last week, most indexes managed...
SPY Chart done on hourly timeframe. The S&P500 closed above 5000 for the first time ever on Friday as buyers continued pouring into the market. Stellar earnings from large cap technology companies and forecasts of a rate cut have been the fuel for this rally, but this week will be a big test of how soon an interest rate cut could come. Last week we heard several Fed members speak and the theme was that they will continue to rely on economic data to implement a rate cut. We’ll be seeing some of that key economic data this week with the CPI and PPI reports, which have been critical in measuring inflation. December’s inflation reading reflected a uptick from 3.1%...
SPY Chart done on hourly timeframe. Bulls squeezed markets into new highs last week after earnings from Amazon and Meta sent the technology sector higher. Many feared that tech stocks would miss on earnings this quarter and force markets back down, however so far most companies have met analysts’ targets. Amazon, Meta, Netflix, and Microsoft have especially stood out as their results were far above expectations, but more importantly their guidance reflects a strong 2024. With markets already at a “extreme greed” reading, earnings acted as a catalyst and fueled stocks higher to seal off the week. Coming into this week our focus will mostly be on technical analysis. There aren’t many notable reports on the economic front, but...
SPY Chart done on hourly timeframe. The S&P500 broke new barriers last week after a tech stock rally fueled markets to all time highs. The spark that lit off the move was the strong quarterly earnings from Taiwan Semiconductor Manufacturing Company (See earnings blog post from January 18th on our website). The semiconductor giant beat analysts’ expectations and helped boost other mega large chip manufacturers such as Nvidia and AMD to new all time highs. More earnings are expected this week from key companies such as Netflix, Tesla, and IBM. Investors will be watching closely for the 2024 outlook these companies post because they’ll provide more clarity on what to expect in the quarters ahead. On the economic front, last week...
