US Market Summary: Mixed Movement as Corporate Earnings Start; Lower PPI Data and Rising Tension in Middle East

January 15, 2024

As we delve into the latest developments in the U.S. financial markets, it is evident that a blend of fluctuating stock indices, dynamic sector performances, and macroeconomic factors has shaped the landscape.

The beginning of 2024 has been marked by a series of ups and downs, reflecting the complex interplay of global events, policy changes, and corporate earnings.

On Friday, the US market was closed relatively flat. The S&P 500 saw modest gains, up 3.59 points or 0.08%, ending at 4,783.83 and NASDAQ Composite marginally increased by 2.58 points or 0.02%, closing at 14,972.76. Meanwhile, the Dow Jones Industrial Average experienced a dip, dropping 118.04 points or 0.31%, to close at 37,592.98.

Here are some of the key events that moved the market.

  • Two-year Treasury yields fell to their lowest since May due to unexpectedly lower U.S. producer prices in December, suggesting potential for reduced inflation and anticipation of an early U.S. interest rate cut.
  • U.S. banks, including JPMorgan Chase (NYSE: JPM), reported lower profits due to special charges and some consumer loans souring. Despite a drop in quarterly profit, JPMorgan Chase achieved its best-ever annual profit, expecting higher interest income in 2024. However, its shares declined by 0.7%.
  • Microsoft (NASDAQ: MSFT) surpassed Apple (NASDAQ: AAPL) to become the world’s most valuable publicly traded company. Microsoft’s stock rose 1% on Friday to $388.47 per share, leading to a market cap just under $2.9 trillion, compared to Apple’s more modest increase.
  • The Federal Reserve reported a record loss of $114.3 billion last year, primarily due to increased interest expenses from its rate hike campaign. The Fed’s operational costs were $5.5 billion in 2023, and it created a deferred asset to cover the deficit.
  • S&P 500 companies are expected to have a 4.4% increase in earnings for the fourth quarter, according to LSEG. The projection for 2024 is an 11% rise in S&P 500 earnings, following a 2.9% increase in 2023.
  • The energy sector underperformed, falling nearly 3% since late October, despite the S&P 500’s 24% rise for the year. Oil prices have seen fluctuations, with a temporary spike due to Middle East tensions but overall remaining below previous year levels.
  • Bitcoin exhibited notable volatility, declining over 5% after a surge to a two-year high, following the SEC’s nod to bitcoin-linked exchange-traded funds.

Disclaimer: ProsperUs Head of Content & Investment Lead Billy Toh doesn’t own shares of any companies mentioned.

Billy Toh

Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.

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