Stock Market Today: April 8th - 12th, 2024

Welcome StonkForums to the trading week of April 8th!

This past week saw the following moves in the S&P:


S&P Sectors End of Week:


Major Indices End of Week:


Major Futures Markets End of Week:


Economic Calendar for the Week Ahead:


What to Watch in the Week Ahead:
(N/A.)

 

Oil & Gold Soar On Week, But 'Good Data' Wrecks Rate-Cut Hopes, Slamming Stocks & Bonds
FRIDAY, APR 05, 2024 - 04:00 PM

It was a 'good' week for macro data...



Source: Bloomberg

...but 'soft' survey data remains mired in depression as the 'aggregate' hard data holds strong...



Source: Bloomberg

Of course, good news is bad news for the doves and rate-cut expectations for 2024 are down (particularly after today's big payrolls headline beat) well below three cuts expected by the 'median' Fed dot...



Source: Bloomberg

...and the odds of a cut in June have tumbled back to a coin-toss...



Source: Bloomberg

And to rub salt in the wounds of the doves, inflation expectations are back on the rise bigly...



Source: Bloomberg

Stocks initially down-pumped on the hjobs data (good is bad) then went into their usual BTFD insanity, ramping Nasdaq to unchanged vs Wenesday's close (erasing yesterday's losses). However, within minutes of that FedSpeak spoiled the party again:

1310ET *FED'S BOWMAN: INFLATION PROGRESS HAS STALLED, WON'T BE COMFORTABLE CUTTING UNTIL DISINFLATION RETURNS

And stocks started back lower...



On the week, all the majors were red with Small Caps and The Dow the worst performers. This was the S&P 500's worst week since the first week of the year...



MAG7 stocks managed to eke out very modest gains as a basket on the week...



Source: Bloomberg

Energy stocks soared this week (to a record high) - the only sector to end green - while Healthcare and Real Estate lagged...



Source: Bloomberg

VIX saw its biggest weekly surge since August 2023...



Source: Bloomberg

Bonds were also ugly on the week, led by the long-end...



Source: Bloomberg

The 2Y Yield pushed up to 2024 YTD highs and closed at its highest yield since November...



Source: Bloomberg

The Dollar ended a choppy week modestly lower after spiking initially today into the green...



Source: Bloomberg

Interestingly, since The BoJ unleashed chaos in JPY-land, USDJPY has gone too sleep. @Bespoke notes that this is the smallest 13-day range for USDJPY since 1980...



Source: Bloomberg

Gold had another huge week, rallying to a new record high above $2330 (spot). Gold is up 9 of the last 10 days and 6 of the last 7 weeks...



Source: Bloomberg

Gold is screaming that something bad is coming (inferring negative real yields - something we have only seen deep in crises)...



Source: Bloomberg

Oil prices also surged, with Brent topping $90 and WTI topping $87.50 this week, as gepolitical tensions turned the rhetoric up to '11'...



Source: Bloomberg

And strength in oil meant gasoline and pump prices rose too...



Source: Bloomberg

Bitcoin was down on the week, but found support at $65,000 and bounced back amid a re-ignition of net ETF inflows...



Source: Bloomberg

Ethereum underperformed on the week, breaking down to its weakest against bitcoin since May 2021...



Source: Bloomberg

Finally, with all the macro and geopolitical headlines, everyone seems to have forgotten about the whole premise for this rally was AI and wunderstock NVDA which is down 11% from its record highs one-month ago...



Source: Bloomberg

History rhymes...

 

A Blockbuster Payroll Report Suggests the Economy Is Far From Recession


We’ve been getting good news about the labor market in recent months – job growth has been strong, and the unemployment rate has been below 4% for 26 straight months (the longest streak since the late 1960s). However, there were some concerns at the edges if you looked hard enough. The March payroll report set aside a lot of these worries, as it was positive across the board.

Payroll growth actually picked up in recent months. The economy created 303,000 net new jobs in March (well above expectations for a 214,000 increase), and with positive revisions to January and February, payroll growth averaged 276,000 a month in the first quarter. Payroll growth averaged 212,000 in Q4 2023, and for further perspective, it averaged 166,000 in 2019.



A lot of the employment growth over the past year has come from non-cyclical sectors like health care, education, and government – but only because these sectors lagged the initial recovery in 2021-2022. However, cyclical areas are bouncing back. Payroll growth in the goods-producing sector, along with retail trade and leisure and hospitality, saw 109,000 jobs created in March. That by itself is almost enough to keep up with population growth.

The unemployment rate had risen from 3.4% last April to 3.9% in February, raising concerns. The unemployment rate comes out of the Bureau of Labor Statistics’ “Household Survey”, which is smaller and more noisier than the “establishment Survey”, which is where the payroll data comes from. Employment gains had lagged in the household survey in recent months, but March saw a reversal. As a result there was a welcome pullback in the unemployment rate to 3.8%. That’s still higher than a year ago, but not by much. Moreover, higher immigration is increasing the supply of workers and there’s a lag between when new immigrants enter the workforce and how quickly they find jobs (higher immigration has also a key reason why real economic growth has exceeded expectations). In any case, I prefer to look at the “prime-age” employment-population ratio, which tells you how many people in their prime working years (25-54) are employed relative to the population. The measure is at 80.7%, exactly where it was a year ago and higher than at any point between July 2001 and February 2020. That by itself tells you how strong the labor market and economy is, with a higher proportion of prime-age adults working now than we saw over the last two expansions.



But does a strong labor market raise concerns over inflation?
A strong labor market would typically raise the prospect of higher inflation. The logic is that a hot labor market would result in higher wage growth, which would push demand for goods and services higher, resulting in higher inflation. However, wage growth has been easing since 2022, and the story hasn’t change despite the recent acceleration in hiring.

If you look at overall income growth across all workers in the economy (a product of employment growth, hourly wage growth, and hours worked), that’s running at a 6.1% annualized pace over the last three months. That’s stronger than what we saw pre-pandemic, when aggregate income growth averaged about 4.7% annualized, but well off the red-hot levels of 10%+ in 2021-2022 (when inflation surged).



Moreover, there are two notable things that pop out when looking at aggregate income.

One, income growth is running ahead of inflation. After adjusting for inflation, aggregate income rose at an annualized pace of about 2% in the first quarter (assuming the Fed’s preferred inflation metric, the personal consumption expenditures index, rose at a 4.1% annualized pace in Q1). That’s positive for consumption, and the economy.

Two, hours worked has been running flat recently (the green bars in the chart above). At the same time, GDP growth in the first quarter is estimated to clock in around 2.5% (using the Atlanta Fed GDP Nowcast). That means labor productivity continues to run strong, as workers are producing above-trend output while working the same amount of hours.

Higher productivity was a key theme in our 2024 Outlook, and it’s encouraging to see signs of that continuing, mostly thanks to a strong labor market that is drawing more workers in (including immigration). As we’ve written in the past, productivity growth allows for strong wage growth with muted inflation. Which is positive in two ways:

• Some of the productivity growth is taken by firms in the form of margin growth. (Firms don’t pass all the productivity gains to workers, much as we’d all like our employers to do that.)
• Muted inflation even in the face of a strong labor market means the Fed can start to ease rates, which will potentially fuel investment and provide a further boost to productivity.

With respect to potential interest rate cuts by the Federal Reserve, the strong labor market and economy doesn’t preclude cuts. Of course, the inflation data needs to cooperate, but we do expect inflation to pull back in March and April, reversing the firming we saw in the first two months of the year. The good news is that there’s nothing in the economic data that suggests we’re on the verge of a labor-market induced inflation surge. Yes, some commodity prices are rising amid Middle East tensions, but as we’ve seen in the recent past, these are volatile and prices can reverse just as quickly.

April Ends Best Six Months #1 DJIA

April is the final month of the “Best Six Months” for DJIA and the S&P 500. April is #1 DJIA month by average performance since 1950, 2nd best S&P 500 month and 4th best NASDAQ (since 1971).

In election years, performance and rank softens slightly, 3rd best DJIA and S&P 500 month, 6th for NASDAQ, but remains bullish. April is the last month of DJIA and S&P 500 “Best Six Months.” NASDAQ’s Best Months run through June. Election Year Aprils are up 1.3% on average for S&P 500.

Three Things That Just Happened That Are Great News for Bulls


“We may not know where we are going, but we better know where we stand.” –Howard Marks, Co-Founder of Oaktree Capital Management

Following the huge 11.2% rally for the S&P 500 in the fourth quarter of last year, the index has given us an encore performance in the first quarter with a 10.2% gain. Big gains like this in Q1 aren’t very common. Only 11 times has the S&P 500 gained more than 10% in the first quarter. But the good news is what happened next tended to be good for s.

April gained 1.1% on average following those 11 big first quarters, not quite the average 1.5% gain, but not a bad number by any means. Looking at Q2 the returns get a tad better, and the rest of the year has been higher 10 out of 11 times with a solid 8.2% median return. Yes, the one time things didn’t work out was in 1987, but note that stocks were up 40% for the year in August back then, so that was a much more stretched rubber band than now. The bottom line, a big Q1 could be a clue the bull market is alive and well.



If a 10% Q1 was rare, let’s now talk about back-to-back double digit quarters. We are looking at only the eighth time that has ever happened and the first time since Q1 2012 (also an election year). The one and two quarter returns aren’t much to get excited about (but after a huge move, some type of consolidation is perfectly normal), but a year later stocks were higher six out of seven times and up 12.1% on average. Again, this is likely a positive sign of continued strength from stocks.



Last and certainly not least, here’s one of my favorite indicators. This is called the December Low Indicator and it is fairly straightforward. When the S&P 500 doesn’t close beneath the December low close in the first quarter, good things have tended to happen the rest of the year. The opposite, of course, is when the December lows are violated in the first quarter. To refresh your memory, last year they didn’t break the December low and it was a great year, while a break in early 2022 was one subtle clue that the odds were elevated that the rest of the year could be dicey. Given that stocks didn’t break their December low this year, this is one less worry for sure.

Interestingly, since 1950, stocks held above the December lows 37 times while they broke the lows 37 times. Talk about even-steven. Those are some pretty big sample sizes, and sure enough, the results are quite conclusive.

Those 37 times the December lows held? The full year was up an incredible 35 times and up an average of 18.8%. The times it failed? The full year was down 0.2% on average and higher less than a coin flip.



If you want to investigate things more closely, here are all 37 times the S&P 500 held above the December lows. I added what happened the rest of the year (so the next three quarters) as well, and once again, strong performance was quite normal. We get it, anything could happen from here. But the truth is it would be abnormal to see a massive bear market and horrible year for stocks this year.



Here’s the other side to things. What happened when the December low was violated? Once again, the full year and the next three quarters’ returns were much weaker. Just a quick glance and some of the worst years ever saw the December lows broken. Years like ’73, ’74, the tech bubble, ’08, and ’22 all made this infamous list.



Odds are, as you read this, I will be somewhere in wine country out in California (probably Calistoga). You caught me. I wrote this one a few days early, so I’m not overly concerned given this potentially bullish development. I’m more into enjoying a very laid-back part of the country and some of the best food from the best chefs in the world. But starting next week I’ll be focusing on all of this more closely. Or, as Howard Marks said in the quote above, we don’t know where we are going, but we do know we stand on potentially a better backdrop for stocks than most think.

Streaks of the S&P 500
Tue, Apr 2, 2024

In last Thursday's Closer, we spotlighted how the S&P 500 has consistently traded at overbought levels this year. Through early afternoon on Tuesday, the S&P 500 was on pace for its 52nd straight trading day of closing at least a full standard deviation above its 50-DMA which ranks as the longest streak since April 1998 (60 trading days).



Not only has the S&P 500 been extended versus its 50-DMA, but it has also traded overbought relative to its 200-DMA. Through early afternoon Tuesday (4/2), the index was also on pace for its 95th straight day of closing more than a standard deviation above its 200-DMA. Interestingly, compared to the 50-DMA streak the current streak of overbought closes versus the 200-DMA stands out much less. Since 1928, there have been 34 streaks of at least 95 days with three of the longest lasting for over a year (1955, 1959, and 1996).



That is not to say the current run of longer-term overbought readings is unremarkable. For much of that current streak, the S&P 500 has been extremely overbought (at least 2 standard deviations above its 200-DMA). Yesterday's close marked the 41st day in a row with a 200-DMA extreme overbought reading. That is the longest such streak since early 2018, and before that, there were only eight other similarly long or longer runs. That being said, the S&P 500 decline of more than 1% in early afternoon trading today puts the index on pace to close 1.9 standard deviations above its 200-DMA, ending the current streak.



The S&P 500 being consistently overbought is not the only notable current streak. As shown below, we are also nearing 100 days in a row in which the S&P 500 has been higher month-over-month (21-trading day rate of change). At 97 trading days, this streak of month-over-month gains ranks as the ninth longest on record after surpassing a 96 trading day streak that ended on September 5th, 1980.

Equities Shine Over Bonds
Mon, Apr 1, 2024

Helped mainly by the massive gain since late October, the S&P 500’s one-year trailing total return through the end of March clocked in at an eye-watering 30.5%, or nearly triple the historical average of 11.8%. While the rally over the last year has been well above average, it followed a period of weak returns in the prior year. When you combine the last two years, the S&P 500’s annualized gain of 9.7% is nearly a full percentage point below the long-term historical average. Looking out over the last five and ten years, annualized returns have been well above average, but over the prior twenty years, the S&P 500's performance has been sub-par.



Equity market returns may have been below average over the last two and twenty years, but you won't find many equity investors looking to trade shoes with investors hiding out in long-term (LT) US Treasuries. The chart below shows the annualized total return of the Bank of America/Merrill Lynch index of 10+ Year US Treasuries over various timeframes. Over the last year, LT Treasuries declined 4.8% versus a long-term average annualized gain of 8.1%. If you think that’s bad, check out the two-year annualized decline of 13.1%...in Treasuries! That’s a 25% haircut! Even over the last five years, LT Treasury returns have been negative to the tune of 1.6% annualized. To find – not better than average – but simply positive returns, you have to go out to the ten-year window, where the total return is just 1.6% annualized and still seven percentage points less than the historical average. While technically not a lost decade, it's been a loser of a decade for sure.



Q1 2024 Asset Class Performance + Big Winners and Losers
Thu, Mar 28, 2024

The first quarter of 2024 ended with the S&P 500 (SPY) posting a total return of 10.4%. That was good enough to beat the Tech-heavy Nasdaq 100 (QQQ) and the blue-chip Dow 30 (DIA) on the large-cap front, and it also beat both mid-caps (IJH) and small-caps (IWM). The weakest of the various US index ETFs in Q1 was the small-cap value ETF (IJS), which was up just 0.06%.

Looking at sectors, it was Energy (XLE), Financials (XLF), Communication Services (XLC), and Industrials (XLI) that posted double-digit percentage gains, while Real Estate (XLRE) was the only sector in the red with a decline of 0.65%.

Outside of the US, there were some winners like Italy (EWI) and Japan (EWJ) and losers like Brazil (EWZ), Hong Kong (EWH), and China (MCHI).

Commodity ETFs saw some big gains in Q1, although natural gas (UNG) fell sharply. While Treasury ETFs were up slightly in March, they finished Q1 slightly in the red.



Below is a look at the average performance of Russell 1,000 stocks in Q1 broken out by sector. As shown, Energy stocks averaged the biggest gains in Q1 at 11.56%, followed by Industrials (10.08%) and Financials (9.61%). Notably, Tech stocks averaged a gain of just 4.86%, while Communication Services and Real Estate stocks averaged declines.



Below is a look at the 30 best performing Russell 1,000 stocks in Q1. NVIDIA (NVDA) topped the list with an 82.5% gain, but surprisingly, a Utilities stock (VST) ranked second with a gain of 80.8%. AppLovin (APP), Shockwave Medical (SWAV), and Vertiv (VRT) rounded out the top five.

When we crossed the list of big Q1 winners with our Bespoke AI basket, it's interesting that just three of the top thirty stocks are on our AI list: NVDA, VRT, and PSTG. There were plenty of non-AI and non-Tech stocks up big in Q1, like Williams-Sonoma (WSM), Crocs (CROX), Kellogg (KLG), Spotify (SPOT), and DoorDash (DASH).



Not everything went up in Q1. Roughly a third of the Russell 1,000 finished the quarter in the red, while there were 49 stocks in the index that fell more than 20%. Below are the 30 stocks that did the worst in Q1, led by New York Community Bancorp's (NYCB) decline of 68.5%.

 

Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2024-



S&P sectors for the past week-

 

Here are the current major indices pullback/correction levels from 52WK highs as of week ending 4.5.24-


Here is also the pullback/correction levels from current prices


Here are the current major indices rally levels from 52WK lows as of week ending 4.5.24-

 

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Here are the upcoming IPO's for this week-

 

Stock Market Analysis Video for April 5th, 2024
Video from AlphaTrends Brian Shannon


ShadowTrader Video Weekly 4/7/24
Video from ShadowTrader Peter Reznicek
(VIDEO NOT YET POSTED.)

 

StonkForumers! Come join us on our stock market competitions for this upcoming trading week ahead!-

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StonkForums Weekly Stock Picking Contest & SPX Sentiment Poll (4/8-4/12) <-- click there to cast your weekly market direction vote and stock picks for this coming week ahead!

Daily SPX Sentiment Poll for Monday (4/8) <-- click there to cast your daily market direction vote for this coming Tuesday ahead!

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It would be pretty sweet to see some of you join us and participate on these!

I hope you all have a fantastic weekend ahead!

 

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Here are the most anticipated Earnings Releases for this upcoming trading week ahead.

***Check mark next to the stock symbols denotes confirmed earnings release date & time***

Monday 4.8.24 Before Market Open:

Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES!

Monday 4.8.24 After Market Close:

Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Tuesday 4.9.24 Before Market Open:

Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Tuesday 4.9.24 After Market Close:

Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Wednesday 4.10.24 Before Market Open:

Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Wednesday 4.10.24 After Market Close:

Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Thursday 4.11.24 Before Market Open:

Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Thursday 4.11.24 After Market Close:

Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Friday 4.12.24 Before Market Open:

Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES!

(T.B.A.)

Friday 4.12.24 After Market Close:

Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES!

(NONE.)

 

And finally here is the most anticipated earnings calendar for this upcoming trading week ahead-
($TLRY $DAL $JPM $STZ $AEHR $WFC $WDFC $BLK $C $PGR $APLD $PSMT $CGNT $KMX $FAST $NEOG $SGH $LOVE $RENT $STT $CONN $RELL $RICK $KITT $LAKE $GRR $NTIC $HOFT $KULR $THTX)


If you guys want to view the full earnings post please see this thread here-

• Most Anticipated Earnings Releases for the week beginning April 8th, 2024 <-- click there to view!

 

Top of the morning StonkForumers! Happy Monday to all of you and welcome to the new trading week and a frrrrrrrrrrrresh start. Here is a quick check on those futures as we are less than an hour from the US cash market open.

GLTA on this Monday, April the 8th, 2024!

 

Morning Lineup - 4/8/24 - Looking Up
Mon, Apr 8, 2024

US futures are little changed, but treasury yields are higher this morning with the 10-year yield above 4.45%. European stocks are firmly in positive territory as they play catchup to Friday’s strength in the US. The April reading of European investor sentiment from Sentix also came in less bad than expected in another sign that investor confidence around the globe has been improving. Gains in the short term are likely to be kept in check with this week’s ECB policy meeting looming on Thursday. No change in rates is expected, but markets are still pricing in a June cut, something here in the US that has been increasingly priced as less likely.

There’s not much in the way of economic activity to speak of this morning. The only report on the calendar is the NY Fed’s survey of Consumer Expectations, and the key metric to watch in that report is the reading on one-year inflation expectations. March’s reading showed a modest uptick from 3.00% up to 3.04% which was the first monthly increase since September, and that increase only added fuel to the fire of fears that the progress we’ve seen on inflation is starting to slow. From a broader perspective, though, last month’s increase came after eight declines in ten months. Not only that but including March’s increase, since the peak of 6.78% back in June 2022, expectations for inflation have declined in 15 out of the last 20 months. So, the road lower in inflation was never expected to be a straight line, but so far, there hasn't been a break of the downtrend.

 

Here is a final look at today's market and futures maps, as well as how each sector performed individually at the close on Monday, April 8th, 2024.

 

Top of the morning StonkForumers! Happy Tuesday to all of you and welcome to the new trading day and a frrrrrrrrrrrresh start. Here is a quick check on those futures as we are less than an hour into the US cash market open.

GLTA on this Tuesday, April the 9th, 2024!

 

Morning Lineup - 4/9/24 - Commodities Rolling
Tue, Apr 9, 2024

There's a positive tone to kick off the trading day this morning as equity futures are higher, yields are lower, and gold continues to rip. The only asset class seemingly not moving higher is bitcoin, but today's weakness in the largest crypto follows what was a very positive day to kick off the trading week. The only economic report on the calendar this morning was small business optimism from the NFIB. The headline index came in weaker than expected, and labor market indicators, which we detail in today's Morning Lineup, continue to show weakness even if there was no additional deterioration relative to February.

If it seems as though gold does nothing but trade higher these days, you’re not entirely mistaken. This morning, prices are higher once again as the commodity is on pace for its tenth up day in the last eleven trading days. That also includes four days last week where it traded up by at least 1%. What’s even more incredible is that heading into today, gold had traded higher on 22 of the last 30 trading days. That’s the highest winning percentage since March 2022, and the last time the 30-day rolling total of up days exceeded 22 was back in August 2020. Going back to the early 1980s, there have only been a handful of periods where the number of daily gains over 30 days was higher.



Gold’s rally has been part of a broader rally in the commodity space. The snapshot from our Trend Analyzer below shows where various energy and metals-related commodities closed yesterday relative to their short-term trading ranges. They’re all up at least 3%, and in most cases much more, in the last week, and most of them are more than 10% above their 50-day moving averages. As a result, it shouldn’t come as a surprise that the ETFs are all in what we define as ‘extreme’ overbought territory (at least two standard deviations above their 50-day moving averages).



Below we show one-year price charts of the six ETFs listed above. Outside of the Commodity Index Total Return ETN (DJP), which is comprised of more than just oil and metals, the five other ETFs are all trading tight at or near 52-week highs, but up until a few weeks ago, they were all somewhat range bound over the last two months. It wasn’t until early March that they really started to get rolling.

 

Here is a final look at today's market and futures maps, as well as how each sector performed individually at the close on Tuesday, April 9th, 2024.