Hey there, readers! Today, let's dive into the world of stocks and explore the main events that are shaping the market. Strap in, because it's going to be an exciting ride!
Stocks did not get off to a flying start for the shortened week. The S&P 500 index was down by 0.4% on Tuesday, bringing it back into the red for the young year so far. The Nasdaq Composite index was off by 0.2%, and the Dow Jones Industrial Average shed 231 points, or about 0.6%.
Boeing's 7.9% decline made it the worst performer in the S&P 500. The company is facing fresh delays in shipments of planes to China, as the fallout from the Alaska Airlines incident on a 737 MAX jet continues. Meanwhile, shares of Spirit Airlines were off by 47% after a federal judge blocked the carrier's acquisition by JetBlue. Disruptions to the movement of oil did not help the market, either, after Shell suspended Red Sea shipments. S&P 500 energy companies were down by 2.4% on the day.
Megabank stocks overall tumbled after Goldman Sachs and Morgan Stanley reported earnings. Goldman itself rose 0.7%, though. Investors might be noting some strands of optimism for the firm's Wall Street activity, as Heard's Telis Demos writes. Morgan Stanley, meanwhile, shed 4.2%.
If market bulls are hoping that the Federal Reserve will bail them out, they may need to be patient. A top Fed official urged that interest-rate cuts should be "calibrated" and "not rushed." Here’s what else Heard on the Street was watching:
Crude oil, Bitcoin USD, and gold continuous contract data refresh every time you open this email. Other data are as of market close.
Now, let's move on to some interesting articles:
A Way to Maximize Your Multicloud Strategy
Most enterprises use multiple cloud platforms—inadvertently—from bringing in new services ad hoc without a holistic strategy. The complexities of maintaining a multicloud environment include holes in security, redundant services, and difficulty finding workers. To simplify cloud management—and fully realize the benefits of their cloud investments—some are turning to a new strategy. Learn More
Wall Street’s Cloudy Quarter Has Some Rays of Sunshine
Wall Street hardly ended last year with a bang. But given the challenges facing the other major business lines of the biggest banks, from lending to wealth management, trading and investment banking might prove to be their best bet in 2024. However, this isn’t to say there weren’t any positive indicators. For one, there was growth in debt capital markets. While stock issuance like initial public offerings can be volatile, companies often come to the bond or loan market with longer-term goals in mind. And while revenue on the trading side of markets was down, interest-driven trading-related revenue was up. It is still too early to call a coming rebound for investment banking or trading. But at least the Wall Street giants have exposure to something that might plausibly grow this year. Read More
Profits Comeback Paired With Rate Cuts Make a Powerful Mix
Profits are growing again, and the Federal Reserve looks as if it will start cutting rates sometime this year. It is an unusual combination and, for the stock market, possibly a potent one. Earnings season has just gotten underway, with a bevy of big banks reporting fourth-quarter results on Friday. It is early days still, but the rebound in profits that began in the third quarter looks poised to continue. Analysts on average estimate that earnings per share at companies in the S&P 500 will register an increase of 4.4% in the fourth quarter from a year earlier, according to London Stock Exchange Group, which compares with a third-quarter gain of 7.5% and a second-quarter decline of 2.8%. Read More
That's all for today, folks! Stay tuned for more exciting news and updates from the world of stocks. Happy investing!
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