Nasdaq Markets Outlook

A mostly graphical daily curated roundup of the markets and the economy from Nasdaq's IR team.

* source: Goldman Sachs Global Investment Research

* source: BofA

| market breadth not too bad but not wide either

* source: Goldman Sachs Global Investment Research

| "It took more than 2 years and over 500 days of trading, but the S&P 500 index finally surpassed the all-time highs it set back in January 2022. It caps off the sixth longest stretch without a new high since the inception of the index back in 1950, and the longest since 2013, when stocks finally erased the 2007-2009 collapse." -Grindstone Intelligence

| The markets have travelled far but really haven't gone anywhere the last 2 years

* source: Grindstone Intelligence

| 2024 looking familiar - Tech + Comms + HealthCare (defensive) outperforming while Utes + Materials + Energy + Small Caps underperforming

* source: Factset, produced by Gavin Zaentz

| March rate cut odds has fallen below 50%

| Rate cut odds getting dialed back slightly...current Fed Funds rate = 5.33 and projected to be 4.11 in Jan 2025

* source: Yardeni Research

| All eyes on job market: historically large cuts in Fed's rates followed rising unemployment

* source: Deutsche Bank

1) KEY TAKEAWAYS

1) Equities + Oil HIGHER / Gold + Dollar + TYields LOWER

-Chinese indices continue to underperform and make new lows

Gloom Over China Assets Is Spreading Beyond Battered Stocks - BBG

DJ +0.4% S&P500 +0.5% Nasdaq +0.5% R2K +1.2% Cdn TSX +0.1%

Stoxx Europe 600 +0.6% APAC stocks MIXED, 10YR TYield = 4.092%

Dollar LOWER, Gold $2,020, WTI +1%, $74; Brent +1%, $79, Bitcoin $40,615

2) "University of Michigan’s Consumer Sentiment Index jumped 13.1% in January. The gain in confidence was spread between the current outlook (+13.6%) and expectations (+12.6%)."

* source: John Stoltzfus Oppenheimer Asset Management

3) BofA's Key Takeaways from Week 1 of Earnings... | "Beats saw no rewards, while misses got punished."

* source: BofA's Savita & Ohsung

4) Last week: Large Cap Growth back to outperformance... | Growth > Value

* source: Piper Sandler

6) Growth > Value & Large Cap > Small Cap

* source: Goldman Sachs Global Investment Research

7) "Excluding financials, results have come in above expectations, with an earnings surprise of +5% versus an earnings surprise of -21% including financials." -JPM AM

* source: JPM AM

8) Top 3 lessons learned in 2023 by Piper Sandler

* source: Piper Sandler

9) THIS WEEK:

"Growth indicators will be in focus with key releases including the preliminary Q4 GDP reading in the US and the global flash PMIs.

On the inflation front, there will be prints for US PCE and Tokyo CPI.

In US politics, the spotlight will be on the New Hampshire primary on Tuesday.

From central banks, there will be decisions from the BoJ, the ECB and the BoC, with the ECB's bank lending survey also due." -Deutsche Bank

* source: Barclays' Emmanuel Cau

2) ESG, COMPILED BY NATHAN GREENE

Exxon Sues Two ESG Investors - YahooF

-Exxon Mobil Corp on Sunday filed a complaint in a Texas court seeking to prevent a climate proposal by activist investors from going to a vote during the company's shareholder meeting in May. 

-Exxon says the investors are "driven by an extreme agenda" and that their repeated proposals do not serve investors’ interests or promote long-term shareholder value. Investors led by U.S. activist investment firm Arjuna Capital and shareholder activist group Follow This are asking Exxon and other oil majors to adopt tighter climate targets.

US Supreme Court ruling on agency powers may impact Biden ESG investing rule - Reuters

-On Wednesday, the Supreme Court heard arguments in a dispute involving a government-run program to monitor for overfishing of herring off New England's coast. Two fishing companies asked the justices to restrict or overturn the court's 1984 legal precedent requiring judges to defer to reasonable federal agency interpretations of U.S. laws deemed to be ambiguous, a doctrine called "Chevron deference."

-Texas-based U.S. District Judge Matthew Kacsmaryk, presiding over the lawsuit challenging the investing rule, said in September that the U.S. law governing retirement plans was unclear on whether such plans could consider environmental, social and corporate governance (ESG) factors in making investment decisions.

3) MARKETS, MACRO, CORPORATE NEWS

• Companies’ reluctance to roll back price rises poses US inflation risk-FT
• Euro Zone’s job-market puzzle shows risk of early ECB rate cuts-BBG
• European manufacturers retailers face ‘chaotic’ period after Red Sea attacks-FT
• Red Sea crisis seeps into German chemicals sector-RTRS
• Donald Trump moves closer to Republican coronation-FT
• US Treasury, Chinese finance officials agree keep meeting Beijing talks-RTRS
• US, Egypt, Qatar push plan end war, free hostages, form Palestinian state-TOI
• EU seeks ‘consequences’ for Israel over opposition Palestinian statehood-FT
• Steel and GDP figures fuel scepticism over China’s data-FT
• Gloom over China assets is spreading beyond battered stocks-BBG
• China orders indebted local governments halt infrastructure projects-RTRS

• Lula pushes ally for vale CEO as Brazil’s iron ore miner weighs succession-BBG
• Walmart bids farewell to Innovation Hub Store No. 8-BNN
• OpenAI’s Sam Altman in talks with Middle East backers over chip venture-FT
• Warren Buffett tells Citigroup CEO Fraser to keep going with overhaul-RTRS
• American healthcare REIT seeking $700 million in NYSE IPO-BBG
• Struggling logistics firm Flexport raises $260 million from Shopify-INFO
• Amer Sports to weigh raising up to $1.8 billion in US IPO, sources say-BBG
• We don’t have a clear path to victory’: DeSantis exits presidential race-POL
• Sony sends termination letter to Zee over India merger-BBG
• Sony not keen to extend good faith negotiations with Zee-ECON
• FAA advises door plug checks for Boeing 737-900ER jets-AXIOS
• Macy's rejects $5.8 billion takeover offer-AXIOS
• ADM places CFO on leave, cuts earnings forecast amid probe-BBG

Oil/Energy Headlines: 1) US rethinks gas exports, spooking Europe-POL 2) Freezing weather is knocking out millions of barrels of US oil output-BBG 3) Europe, Africa crude market tightens on Red Sea disruptions, China demand-RTRS 4) Russian oil processing falls further after Norsi refinery mishap-BBG 5) Russia becomes top China oil supplier for first time since 2018-BBG 6) The oil market is making plans for Red Sea chaos to last weeks-BBG