Nasdaq Markets Outlook

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

BofA's Ohsung & Savita on earnings:

"-30% of earnings are in and reported companies beat by 5% (73% beat on EPS). Alpha for beats has been more muted vs. history.

-Semis and Trucking show more green shoots. Company commentaries also suggest an improving macro environment for earnings.

-Cold weather hit Jan, but likely a temporary blip. Red Sea might be a headwind to retail, but a tailwind to manufacturing."

* source: BofA

"Guidance is weak, but in line with a typical January"

* source: BofA

| lots of speculation around Fed's rate cuts this year

Strong US growth boosts expectation = Fed will delay cutting rates-FT

* source: Goldman Sachs Global Investment Research

| "we’re currently just below levels [real rates]

where most easing cycles have begun"

* source: Deutsche Bank, Jim Reid

1) KEY TAKEAWAYS

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

-busiest slate of the earnings season = 19% of the S&P 500 reporting

-big tech earnings this week (MSFT, AAPL, META, AMZN, GOOG)

-after debt sale deluge, early signs of a hangover -BBG

-FOMC meeting / big week for macro

DJ +0.1% S&P500 +0.1% Nasdaq +0.2% R2K -0.3% Cdn TSX -0.2%

Stoxx Europe 600 +0.1% APAC stocks HIGHER, 10YR TYield = 4.114%

Dollar HIGHER, Gold $2,022, WTI -2%, $77; Brent -1%, $82, Bitcoin $41,867

2) Market Internals...

* source: Goldman Sachs Global Investment Research

* source: BofA

Market Breadth below long term average and has fallen since late last year

* source: Goldman Sachs Global Investment Research

market breadth has been deteriorating but remains strong across several sectors

* source: Grindstone Intelligence

3) "there was significant optimism coming into 2024 that small and value was
due to outperform.." but has not broadly materialized...

* source: Piper Sandler

4) the winning strategy: "High free cash flow yield is outperforming in large, mid, small, value and growth mandates"

* source: Piper Sandler

5) bond prices/yields have stabilized...

* source: John Stoltzfus, Oppenheimer Asset Management

* source: CNBC

6) geopolitical tensions rising...and 2023 a volatile year for oil

* source: John Stoltzfus, Oppenheimer Asset Management

7) Performance last week:

-positive for major market indexes, energy, and communications;

-consumer discretionary, real estate, and healthcare underperformed.

* source: Factset, created by Gavin Zaentz

* source: Piper Sandler

8) THIS WEEK:

US: Fed's policy decision Wednesday | Friday, US jobs report for January.

Europe: BoE meeting | CPI and GDP reports across the Eurozone.

Earnings: Apple, Amazon, Microsoft and Meta.

* source: Barclays' Emmanuel Cau

2) ESG, COMPILED BY NATHAN GREENE

OFF TODAY

3) MARKETS, MACRO, CORPORATE NEWS

• ECB’s Guindos says policy will reflect good inflation news-BBG
• A year of bad inflation forecasts casts doubt on BOE rate path-BBG
• Mortgage rates in US to snap three-year streak of gains, survey shows-BBG
• UK job vacancies fall by most in three years in sign labor market is cooling-BBG
• Joe Biden says Iran-backed militants killed 3 US troops in drone attack-FT
• Netanyahu says big gaps remain in new hostage negotiations-BBG
• Donald Trump is preparing for a massive new trade war with China-WASHPO
• China's growth model pushes Beijing into more trade conflicts-RTRS
• US aims to announce big grants for chip plants by end of March-BBG
• Chinese developer Evergrande ordered to be wound up by Hong Kong court-FT
• Chinese regulators curb short selling as market downturn deepens-FT
• China's industrial profits fell 2.3% in 2023-RTRS
• China’s deflation pressures seen persisting through mid-2024-BBG

• Willscot Mobile Mini nearing $3 bln deal to acquire McGrath RentCorp-RTRS
• US to announce billions in subsidies for advanced chips -WSJ-RTRS
• Bain in talks with SK Hynix to restart Western Digital-Kioxia merger talks-RTRS
• United CEO kickstarts Airbus talks amid Boeing delays, sources say-RTRS
• Switzerland’s Holcim plans to spin off US cement business-FT
• Investors see Microsoft's stock market value leaving Apple behind-RTRS
• US regional banks hope for profit revival as pain from SVB fallout eases-FT

Oil/Energy Headlines: 1) Reaction to drone strike on US troops in Jordan-RTRS 2) Evergrande is the teetering domino that can tumble its real estate peers-FT 3) Russia thwarts drone attack on oil refinery in Yaroslavl – governor-RTRS 4) US oil futures primed for another squeeze on Cushing-RTRS 5) Crude oil selling price from Iraq's Kurdish region in focus-PLATTS 6) US reviewing whether it should reimpose oil sanctions on Venezuela-PLATTS 7) Ghana trade surplus narrows on smaller cocoa and oil exports-BBG