Earnings concerns appear to be keeping sentiment subdued as the stock market reopens following Monday’s public holiday in observance of Martin Luther King Jr. Day. Bank earnings take center stage on this week’s earnings calendar, and traders will also keep a close eye on key economic data such as retail sales, manufacturing sector indicators, and housing market metrics. Additionally, speeches by Federal Reserve officials will be in focus. After the S&P 500 nudged closer to its all-time closing highs last week, the question arises whether tech stocks, with significant weighting in the index, can provide the momentum to surpass the early-2022 historic high.
Cue From Last Week’s Trading:
U.S. stocks recorded gains in the week ending Jan. 12, 2024, responding to various catalysts, including significant bank earnings and dual inflation reports. Consumer price inflation slightly exceeded expectations, while wholesale inflation remained benign.
The S&P 500 concluded the week within 11 points of its all-time highs, with analysts optimistic that a positive fourth-quarter reporting season could propel the market even higher.
US Index Performance In Week Ended Jan. 12
| Performance (+/-) | Value | |
| Nasdaq Composite | +3.09% | 14,972.76 |
| S&P 500 | +1.84% | 4,783.83 |
| Dow Industrials | +0.34% | 37,592.98 |
| Russell 2000 | -0.01% | 1,950.96 |
Analyst Color: Fund Strat’s Tom Lee, who was fairly accurate with his market predictions in 2023, is optimistic about the S&P 500 making new highs in January. “We still see markets as making new highs in January,” Lee said. Since the index came within 1% of its all-time highs in December, a new high is imminent, he said, adding that this was the case 12 of the 12 precedent instances since 1950.
“That is, after falling 20% and recovering to within 1% of ATH, there has never been a case of a failure. New ATH within 20 trading days, or late Jan at worst.”
Lee is more confident of the second half. “Our base case for 2024 remains a tricky 1H, with the bulk of gains made in the second half of 2024,” he said.
Futures Today
Futures Performance On Tuesday
| Futures | Performance (+/-) |
| Nasdaq 100 | -0.55% |
| S&P 500 | -0.40% |
| Dow | -0.33% |
| R2K | -0.83% |
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