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- February 11th Market Overview
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Happy Tuesday.
A little bit different format today as Im not at my home office this week. Please bare with me during these slight changes for only this week (I promise)
Markets showing pretty neutral response today despite Federal Reserve Chair Powell's cautious stance on rate cuts and the looming escalating trade tensions. $AAPL and Alibaba announced a partnership for AI development.
Let's dig in...
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Executive Summary
Market sentiment holds steady despite Powell highlighting strong economy and the need for continued inflation vigilance
Global trade landscape shifts as President Trump's new steel and aluminum tariffs prompt EU retaliation threats
Tech sector delivers mixed signals: $AAPL ▲ 2.2% on Chinese AI partnership while $TSLA marks fifth straight decline
Markets position carefully ahead of crucial CPI data Wednesday, with bond yields reflecting cautious optimism
Market Overview
Index/Asset | Price | Change | % Change |
|---|---|---|---|
S&P 500 | 6,068.50 | ▲ 2.06 | ▲ 0.03% |
Dow Jones | 44,593.65 | ▲ 123.24 | ▲ 0.28% |
Nasdaq | 19,643.86 | ▼ 70.41 | ▼ 0.36% |
VIX | 16.02 | ▲ 0.21 | ▲ 1.33% |
10-Year Treasury | 4.537 | ▲ 0.042 | ▲ 0.934% |
Key Market Drivers
Federal Reserve Stance & Economic Outlook: Fed Chair Powell's testimony to the Senate Banking Committee emphasized the economy remains "strong overall" with a "solid" labor market. His message that "we do not need to be in a hurry to adjust our policy stance" signals a patient approach to rate cuts while inflation stays above the 2% target.
Trade Policy Developments: President Trump's implementation of new steel and aluminum tariffs creates market uncertainty. The European Union's immediate response threatening retaliatory measures raises concerns about escalating trade tensions and potential impact on global commerce.
Market Cycle Indicators: Fidelity's global macro analysis reveals concerning signals, with only 62% of stocks trading above their 200-day moving average. This technical indicator, combined with a series of negative divergences, suggests the 28-month bull market may be entering its mature phase.
Stock Spotlight
$AAPL ▲ 2.2%: Strategic partnership with Alibaba to develop AI features for Chinese iPhone users
$TSLA ▼ 6.34%: Fifth consecutive decline amid concerns over CEO Musk's focus on OpenAI
$INTC ▲ 7.0%: Best single-day performance since January 17
$PSX ▲ 3.5%: Elliott Investment Management reveals $2.5B stake, pushes for operational changes
$COTY ▼ 9.31%: Earnings miss and foreign-exchange headwinds drive shares to 52-week low
Big Name Updates
$META ends historic 16-day winning streak, longest consecutive gain streak in Nasdaq-100 since 1985
$KO ▲ 3.3%: Exceeds Q4 expectations with revenue of $11.54B vs $10.68B forecast
$CRVN: Wells Fargo lifts price target to $310, citing potential for market share gains
Other Notable Company News
$FIS ▼ 15%: Q4 revenue disappoints at $2.60B versus $2.63B expected
$LSCC ▲ 12%: Beats Q4 revenue estimates with $117.4M
$SNAP receives Guggenheim downgrade, pushing profitability timeline to 2027
$FSLR: Mizuho upgrades to outperform, raises target to $259 on improved post-2026 outlook
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Sector Watch
Sector | Symbol | % Change |
|---|---|---|
Consumer Staples | $XLP | ▲ 0.91% |
Energy | $XLE | ▲ 0.76% |
Real Estate | $XLRE | ▲ 0.56% |
Materials | $XLB | ▲ 0.54% |
Utilities | $XLU | ▲ 0.49% |
Financials | $XLF | ▲ 0.26% |
Technology | $XLK | ▲ 0.18% |
Industrials | $XLI | ▲ 0.02% |
Communication Services | $XLC | ▼ 0.13% |
Healthcare | $XLV | ▼ 0.22% |
Consumer Discretionary | $XLY | ▼ 1.23% |
Bond Market
Treasury yields fluctuate as Powell's testimony emphasizes the Fed's patient approach. His statement that "we do not need to be in a hurry to adjust our policy stance" suggests rates will remain higher for longer. Market participants position ahead of Wednesday's CPI report, which could significantly influence rate expectations.
Policy Watch
Cleveland Fed President Hammack reinforced Powell's stance during a Kentucky forum, noting "upside risks to the inflation outlook abound." Powell's Senate Banking Committee testimony highlighted the Fed's focus on sustainable inflation reduction before considering policy adjustments. The European Union's response to new U.S. tariffs adds complexity to the global economic outlook.
What to Watch
CPI Report Release:
Potential market volatility around Wednesday's inflation data
Key indicator for Fed policy timeline
Impact on rate cut expectations
Powell's House Testimony:
Second day of Congressional appearances
Further clarity on Fed's economic outlook
Potential market-moving commentary
Trade War Developments:
EU response to new U.S. tariffs
Impact on global supply chains
Potential effect on Q1 earnings
Earnings Calendar:
$CRVN results next week
Focus on forward guidance amid economic uncertainty
Consumer spending trends in retail sector
Thanks for reading 🙂
- John
Note: This newsletter is intended for informational purposes only.