Major Forecast of U.S. Stock Exchange, Analysis and Summary of Economic Markets

Major Forecast of U.S. Stock Exchange, Analysis and Summary of Economic Markets

The New York Stock Exchange has overcome its recent slump and made a strong rise for the first time in a long time. In particular, yesterday’s recovery is worth watching. This is because the S&P 500 continued its trend by overcoming the decline at the benchmark on the 20th, which was an important support line, and creating a long tail through strong buying.

Strong economic data is now back in bad news, as market focus turns to the Fed, leaving expectations for a rate cut considerably lighter.

Fortunately, confidence in the economy has grown stronger. Following yesterday’s retail sales data, today’s housing data and jobless claims data suggested the U.S. economy remained very resilient.

Companies and Wall Street also seem to be adding to that. TSMC, the world’s largest chipmaker, boosted the entire semiconductor industry with strong fourth-quarter earnings.

Big Tech leader Apple also gained strength after a long time due to the news of Bank of America’s upward investment opinion. BofA predicts that hardware containing generated AI functions will be introduced to the market one after another in the future and Apple’s iPhone will lead this.

Apple’s growth is expected to be stronger as the combination of artificial intelligence and the iPhone boosts demand for the iPhone over the next three years.

The S&P 500 is showing a fairly positive pattern. If it continues its upward trend tomorrow and keeps today’s low, a new record high will soon be seen. However, given that today’s uptrend is different from before, the market’s narrow range still remains. 📈 Core Issues and Asset Market Trends

✔ Key Issues:

1. Outlook for a rate cut: “Strong consumer spending has propelled the economy in recent weeks,” according to Beige Book, the Fed’s U.S. economic status report, following stronger-than-expected retail sales data for December. Betting on a rate cut in March fell to the 50% range.
2. Economic indicators: Building permits and housing construction, new jobless claims and the release of the Pillar Federal Reserve’s manufacturing index, which is recognized as key leading indicators, amid eased bets on Fed rate cuts with strong economic data.
3. OPEC Outlook: OPEC’s monthly report predicts demand for crude will remain strong over the next two years. U.S. oil supply plunges due to winter storm in North Dakota; Pakistan-Iran conflict intensifies supply concerns.

✔ Asset market trend:

New York’s three major indexes started mixed as prospects for a soft landing in the economy grew amid stronger-than-expected data and mixed expectations of a Fed rate cut. (Dow -0.13%, S&P 500 +0.38%, Nasdaq +0.91%)

Treasury yields rise on strong U.S. economic data, softening expectations for a Fed rate cut, 10-year Treasury yields rise to 4.11%, the dollar strengthens on the back of weak euro and eased outlook for rate cuts. 📈 Core issues and asset market trends

✔ ️ Key Issues:

1. China’s Growth Slows: China’s GDP growth in 2023 is 5.2%, slower than the market’s estimate of 5.3%. New home sales prices and retail sales data are also lagging far below market expectations. Hong Kong’s Hang Seng Index slumped 3.7% and Shanghai’s 2% range.
2. Christopher Waller: The Fed’s director Waller said “inflation is gradually moving towards its 2% target,” but added, “There’s no reason to cut interest rates as quickly as in the past,” cold to market expectations for a rate cut.
3. Regional banks and FED: US Bank Corp UBNC and Citizens Financial Corp CFG to begin reporting regional bank earnings. Fed Vice Chairman Michael Barr will speak following board member Christopher Waller’s announcement of retail sales data for December.

✔️ Asset Market Trends:

The New York Stock Exchange started lower on concerns about a global economic recovery caused by a crash in Asian stocks and mixed expectations for a Fed rate cut. (Dow -0.39%, S&P 500 -0.46%, Nasdaq -0.69%)

Treasury yields rise on hawkish comments from Fed director Waller. 10-year Treasury yields rise to 4.10%. 2-year Treasury yields rise to 4.33%. Dollar index hits highest in a month.

International oil prices plunged on weak data from China, amid worries about global demand. Crud oil fell 2.3% to $70 a barrel. Brent crude fell 1.2% to $77 a barrel. Gold fell on a stronger dollar. Copper fell 0.4% on worries about global economic recovery.

🔰 Today’s Features and Focus Companies

Tesla (TSLA): A week after cutting the prices of the Model 3 and Model Y in China, the company lost its position as the top EV maker in 2023 to Volkswagen, further cutting the price of the Model Y in Germany. Shares fell 1.3% before the opening bell.

International oil prices turn bullish due to OPEC’s strong demand outlook, geopolitical concerns and supply disruptions caused by the U.S. winter storm. Crude oil rose 0.73 percent to $73 a barrel. Brent crude rose 0.4 percent to $78 a barrel. Gold rose on safe-haven sentiment despite a strong dollar.

🔰 Today’s Features and Focus Companies

Apple (AAPL): Apple, which recently fell due to price cuts in response to slowing demand in China, is bullish, with BofA offering a target price of more than 20% upside, with an analysis that Apple will benefit from increased AI demand in the future.