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Daily Markets: Stocks Looking to Gain Momentum Ahead of Year End

ProDentim


The big picture today

Asia-Pacific stock markets ended today’s session largely lower, with Japan’s Nikkei and Australia’s ASX All Ordinaries losing 0.9% while South Korea’s Kospi fell 1. 9%. The Indian Sensex closed the day up 0.4%, offsetting the 0.4% decline in China’s Shanghai Composite. By midday, European equity indices were mixed and US futures suggest stocks will attempt to recoup recent losses when these markets open later this morning.

As expected, trading volumes were much lighter than usual this week, given the holiday season and the lack of emotional headlines in the market. This will likely continue today and tomorrow as traders and investors look to prepare for the holiday weekend and close out 2022, a year that is shaping up to be the worst for major stock market averages since 2008. So that the market has been challenging for the past few days, putting it in an oversold position, we expect further questions to emerge on the market’s next move after the Dow Jones Industrial Average closes below technical support levels with yesterday’s market close.

Data download

International economy

Russian Foreign Minister Sergei Lavrov said Russia would not enter into negotiations with Ukraine to end the war, even after suffering a series of battlefield setbacks.

Bloomberg reports that Italian health authorities will begin testing all arrivals from China for Covid after nearly half of passengers on two flights to Milan were found to be carriers of the virus. Authorities will also sequence the tests to see if there are new variants as well.

Domestical economy

Today at 8:30 a.m. ET, the initial weekly jobless claims and continuing jobless claims are expected to be released. Continuing claims are expected to remain flat at 1.672 million, while initial claims are expected to increase to 223,000 from the previous week’s release of 216,000. While generally not a good sign, increases in initial claims in this environment could be seen as the Fed’s interest rate policy beginning to have a desired effect on the economy. This would of course lead to speculation that the Fed might not have to go as hard or for as long as previously thought in this tightening cycle.

10 a.m. ET will also see the usual cluster of oil, natural gas and ethanol releases, including stocks, inventories and US refinery usage. With prices as low as they are now, it would take big moves in these numbers to have a serious impact.

The Centers for Disease Control and Prevention has confirmed implementation requiring a negative COVID-19 test or recovery documentation for air passengers boarding flights to the United States from the People’s Republic of China and areas. administrative authorities of Hong Kong and Macau.

Markets

There was no explosion yesterday, but the main indices were affected at all levels. The Dow Jones fell 1.10%, the S&P 500 fell 1.20%, the Nasdaq Composite fell 1.35% and the Russell 2000 closed down 1.57%. The only major index that appeared to be up yesterday was the CBOE Market Volatility Index (VIX) which gained 2.26% to settle in a handful of 22 as the street likes to call it. All sectors made compromises with the biggest hits coming from energy (-2.24%) and technology (-1.61%). Health care (-0.65%) and finance (-0.35%) were the relatively safer places.

Here’s how the major market indicators stack up since the start of the year:

  • Dow Jones Industrial Average: -9.53%
  • S&P 500: -20.62%
  • Nasdaq compound: -34.72%
  • Russell 2000: -23.31%
  • Bitcoin (USD-BTC): -64.35%
  • Ether (ETH-USD): -67.78%

Stocks to Watch

Prior to the start of trading in US-listed stocks, no company is expected to release its latest quarterly results. That said, we caution readers to be on the lookout for advance earnings announcements during what is typically a very quiet holiday week for equity markets.

Goldman Sachs (GS) CEO David Solomon said the company was working on a new round of job cuts which will be unveiled in a few weeks.

LG display (LPL) announced that it will unveil its ultra-wide 45-inch OLED and 27-inch gaming-optimized OLED displays in January at CES 2023.

DigiTimes reports Qualcomm (QCOM) is likely to cut the prices of its mid-range and entry-level Snapdragon mobile phone processors, including the 400 and 600 series, in 2023

As part of its 2025 goal of two million battery electric vehicles (BEVs), BMW (BMWYY) plans to increase the number of battery electric vehicle models in China to 11 next year.

Data from the NPD Group revealed that at the start of December, sales of VR headsets in the United States this year had fallen by 2% year-on-year. Major headset companies include Meta platforms (META), HP (HPQ)and Sony (SONY).

When he came out of General Electric (GE), GE HealthCare Technologies (GEHC) will join the S&P 500, replacing Vornado Real Estate Trust (VNO)which ranks in the S&P MidCap 400.

IPOs

As the holiday season continues, the short-term IPO schedule is quite light, so there are no major IPOs scheduled to price this week.

Podcast platform and publisher Courtside Group, better known as PodcastOne (PODC), has applied to list its shares directly on the Nasdaq. The company is spun off from LiveOne and, by filing, intends to offer up to 6.2 million shares.

Readers who want to dig deeper into the schedule of upcoming IPOs should visit Nasdaq’s Latest and Upcoming IPOs page.

After today’s market close

No company is expected to release quarterly results after shares halt trading today. Although the week should be calm due to the end of the year holidays, we suggest that readers be on the lookout for advance results announcements. Those interested in learning more about which companies release their reports when head to the Nasdaq earnings calendar.

on the horizon

Friday, December 30

  • United States: Chicago PMI – December

monday january 2

  • Eurozone: S&P Eurozone Global Manufacturing PMI – December

Tuesday, January 3

  • China: Caixin China General Manufacturing PMI – December
  • United Kingdom: S&P Global/CIPS UK Manufacturing PMI – December
  • United States: Construction spending – November
  • United States: S&P Global US Manufacturing PMI – December

Wednesday January 4

  • Japan: Au Jibun Bank Japan Manufacturing PMI – December
  • Eurozone: S&P Global Eurozone Services PMI – December
  • United States: ISM manufacturing index – December
  • United States: JOLTS – Job Openings Report – November

Thursday January 5

  • China: Caixin China General Services PMI – December
  • UK: S&P Global/CIPS UK Services PMI
  • United States: ADP report on the evolution of employment – December
  • United States: S&P Global US Sector PMI – December

friday 6 january

  • Japan: Au Jibun Bank Japan PMI Services – December
  • United States: Employment Report – December
  • United States: Factory Orders – November
  • United States: ISM non-manufacturing index

Thought of the day

“Every ending is a beginning. We just didn’t know that at the time. -Mitch Albom

Disclosures

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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