Mortgage rates have surged, with the average 30-year fixed rate reaching 7.04% following a sharp increase after the strong January employment report; Port of New Orleans sees a return to pre-pandemic cruise numbers with nearly 1.2 million passengers in 2023; Snap Inc. is cutting about 10% of its global workforce, or approximately 530 employees, joining the trend of tech companies announcing layoffs.
This week, a multitude of companies across various industries are set to release their earnings reports, including industry leaders like Disney, Alibaba, and PepsiCo, as well as household names such as McDonald's and Ford. Analysts anticipate significant growth in EPS and revenue for companies like Palantir Technologies and McDonald's, while concerns about valuation and stability of electric vehicle demand surround Ford. Philip Morris International is expected to post strong results driven by its smoke-free portfolio, and PepsiCo is anticipated to provide stability and an attractive dividend for investors.
The upcoming week on Wall Street will be marked by the start of the corporate earnings season, with reports from major financial institutions and key inflation data releases. The Consumer Price Index (CPI) and Producer Price Index (PPI) for December will provide insights into inflation trends, which are crucial for the Federal Reserve's interest rate decisions. Investors are anticipating earnings reports from JPMorgan, Wells Fargo, Bank of America, BlackRock, and Citi. The market is currently debating when the Fed will cut interest rates, with Goldman Sachs predicting cuts starting in March. The financial sector's performance in the fourth quarter will be closely watched, especially as estimates for S&P 500 earnings have seen a significant decline since September.
BlackRock, the world's largest asset manager, anticipates the SEC's approval of its spot Bitcoin ETF application next Wednesday, as reported by Fox Business. This move could potentially bring billions into the cryptocurrency sector and reflects the market's enthusiasm for direct bitcoin trading products. However, there are concerns about the volatility and regulation of Bitcoin, with some groups warning against the approval. BlackRock is also planning to reduce its workforce by 3%, which amounts to around 600 jobs.
The crypto industry is eagerly awaiting the potential approval of the first spot Bitcoin ETFs by the U.S. Securities and Exchange Commission, which could happen as early as next week. If approved, these ETFs would allow investors to buy Bitcoin directly through their brokerage accounts, a significant development following the already available Bitcoin futures ETFs. This anticipation has contributed to a recent rally in Bitcoin's price, with the market speculating on the impact of easier access to the cryptocurrency for traditional investors.
The U.S. Securities and Exchange Commission (SEC) is reportedly close to approving spot Bitcoin ETFs following last-minute document revisions, with expectations of approval by mid-next week. Coinbase is planning to expand into EU crypto derivatives trading through an acquisition, pending regulatory approval. South Korea is considering a ban on purchasing cryptocurrency with credit cards to prevent illegal fund outflows and money laundering. North Korean hackers have stolen a significant amount of cryptocurrency in 2023, and YouTube personality Logan Paul is offering to buy back NFTs from his failed CryptoZoo game to compensate investors.
The U.S. Securities and Exchange Commission (SEC) is close to approving spot bitcoin ETFs after last-minute discussions with issuers regarding final wording changes in the S-1 prospectus documents. If minor amendments are made by Monday, approval could come as early as next week. This would mark the first time spot bitcoin ETFs are approved in the U.S., following multiple rejections since 2013 due to concerns over market manipulation. Firms like BlackRock, Fidelity, and WisdomTree are among those awaiting the SEC's decision.
Jim Cramer previews the week ahead on Wall Street, emphasizing the JPMorgan Healthcare Conference where major industry CEOs will discuss earnings guidance and clinical trials. Cramer will interview CEOs from companies like Walgreens, Amgen, and Bristol Myers, focusing on topics such as drug development and company transitions. The week will also feature the Consumer Price Index release and the start of the earnings season with reports from major banks and companies like BlackRock, UnitedHealth Group, and Delta.
The stock market ended its nine-week winning streak, marking the worst start to a year since 2016 for the Dow and S&P 500, as investors reacted to strong labor market data and concerns over when the Federal Reserve will cut interest rates. Despite a positive jobs report showing 216,000 new jobs in December, beating expectations, and an unchanged unemployment rate at 3.7%, stocks fell due to fears that the Fed may delay interest rate cuts. Additionally, Apple shares dropped after analyst downgrades, and AMC shares hit an all-time low. Upcoming economic data and corporate earnings reports are expected to further influence market expectations regarding the Fed's monetary policy.
Major U.S. exchanges have filed amended documents for the launch of spot bitcoin ETFs, indicating an anticipation of SEC approval. BlackRock, Grayscale, Fidelity, and other issuers have addressed SEC feedback in their filings, with a final deadline for at least one application on January 10. While approval is not guaranteed, optimism is high among issuers, and SEC commissioners are expected to vote on the matter next week. Approval of both 19b-4 and S-1 filings is required before the ETFs can launch.
Medical Properties Trust Inc. experienced a significant 29% drop in stock value following the announcement of its efforts to recover uncollected rents and outstanding loans from Steward Health Care System, a key tenant and borrower. The situation was exacerbated by Keybanc's downgrade of the stock from overweight to sector weight. This financial instability has raised concerns about the company's ability to maintain its 17.17% annual dividend yield and has turned the stock into a wait-and-see option for investors, rather than an immediate buy-the-dip opportunity.
The stock market experienced a challenging start in 2024, with major indexes like the Dow Jones, S&P 500, and Nasdaq showing losses after a nine-week rally. Nvidia is nearing a breakout with potential for significant free cash flow, while other stocks like Eli Lilly and MercadoLibre are also showing positive signs. The SEC may approve the first spot bitcoin ETFs, which could lead to increased institutional involvement in cryptocurrencies. Investors are advised to monitor the market closely, build their watchlists with strong stocks, and stay prepared to adjust their investment strategies as the market fluctuates.
The Dow Jones Industrial Average and other major indexes saw a slight increase on Friday but experienced overall losses for the week, ending their nine-week winning streak. Treasury Secretary Janet Yellen expressed optimism about the economy achieving a soft landing, citing low inflation and rising wages. Job gains for December exceeded expectations, and factory orders also surpassed estimates. Warren Buffett's Berkshire Hathaway purchased 2.8 million shares of Liberty Media SiriusXM. Meanwhile, outside the Dow, Constellation Brands reported earnings growth, and Mettler-Toledo anticipated lower sales and earnings than previously forecasted.
Bitcoin's value has risen 67% since September, reaching around $43,610, despite a regulatory crackdown and the collapse of FTX in the previous year. The surge is attributed to the anticipation of the U.S. approval of the first spot bitcoin ETF, expected to attract more investors by being traded on traditional exchanges. Other contributing factors include the end of the Federal Reserve's interest rate hikes and the upcoming bitcoin "halving" event in April, which is likely to reduce the token supply and potentially increase demand. However, experts caution that the asset remains volatile and risky, advising investors to only invest what they can afford to lose.
Despite a rocky start to 2024, the Cboe Volatility Index (VIX) remains low, indicating investor optimism for potential equity gains but also raising concerns about market complacency. The VIX has seen a slight increase but is still below its long-term average, suggesting a calm market outlook. However, with the S&P 500 ending a nine-week winning streak and mixed feelings about the Federal Reserve's rate cuts, some analysts warn that the low VIX may not fully account for potential economic turbulence ahead.
