Daily Market Notes | 5-minute read

May 7, 2024

By Donald Selkin | Chief Market Strategist

Dow: 38,892

S&P 500: 5,194

Nasdaq: 16,380

10YR T-Note: 4.44%

Bitcoin: 63,551

VIX: 13.33

Gold: $2,324

Crude Oil: $78.82

40+ Years on

Don Selkin, the creator and innovator of the "Fair Value" numbers, as its Chief Market Strategist on the Newbridge platform has given CNBC and its Predecessor, these numbers every day for the over 40 years - never missing a single day, as well as given the fair value for the Nasdaq 100 futures since their introduction in 1996 and the Dow Jones stock index futures since 1997. Mr. Selkin has also been quoted in several publications including but not limited to Bloomberg News, New York Post, Reuters, and The New York Times. Mr. Selkin's Fair Value numbers are included in the U.S.
Futures Report broadcast on CNBC every day before the market
opens attributing "Newbridge Securities" as the source. In addition, NSC provides to its professionals, their clients and the public access to Don Selkin's more in depth financial market views.

After the strong finish late last week, the market decided that it liked the upside after all and as a result, the Dow ended higher for the sixth time in the last seven days while the S&P and Nasdaq gained three straight times.

The Dow finished with a 176 point gain up to 38,852 led by GS at a new high, in addition to CAT, MSFT and others, while the S&P put in a really strong showing of 52 up to 5180 which now puts it back above its 50-day moving average which was 5130 so now that all of those who trade based on this method can buy now instead of buying several days ago near 5000 which would seem to have been the better strategy, and this is why so many of these money managers never seem to be able to beat the overall market performance.

The Nasdaq put in a powerful showing with a 192 point gain up to 16,349 led by the usual technology favorites with the exception of AAPL on a report that none other than Warren Buffett had unloaded some of his huge number of shares.

The Russell 2000 Index of small stocks keeps plodding along to the upside with a 25 point gain to 2060 while the VIX remained unchanged at 13.49 after having come down a lot on the recent up move in equities lately.

As mentioned, tech stocks were the leaders, with NVDA and SMCI at the head of the class after having had some little setbacks recently the frenzy around artificial-intelligence technology has the former up 86 while the latter has advanced by 192% after its gain of 6%.

VST, an electricity and power generation company, rose after investors learned it will join the S&P 500 index on Wednesday. FRPT jumped 10% after reporting better results than expected in large part because it sold 30% more food for cats and dogs, and BRK.A added 1% after Mr. Buffett’s company reported its latest quarterly results over the weekend.

They helped to offset a 10% slide for SAVE, which reported a slightly worse loss than expected. The carrier said it is facing increased competition in many of its markets, particularly between the United States and Latin America.

The U.S. stock market has been swinging sharply since setting a record at the end of March. It sunk for weeks on fears that stubbornly high inflation would prevent or at least delay the Federal Reserve from delivering cuts to interest rates.

But markets found a burst of optimism at the end of last week following a cooler than expected jobs report, which suggested that the U.S. economy could nail the tightrope walk of staying strong enough to avoid a bad recession, but not so firm that it puts too much upward pressure on inflation.

In the bond market, which has been dictating much of the action in the stock market recently, Treasury yields held mostly steady with the 10-year Treasury edging down to 4.49%, from 4.50% late Friday. The two-year Treasury yield, which more closely tracks expectations for the Fed, was also relatively little changed.

Traders are still betting on a nearly 89% chance that the Fed will cut its main interest rate at least once before the end of the year, according to data from CME Group. That is up from an 81.6% probability seen a week earlier. Lower rates would help ease the pressure on the economy and financial system. There are still some who expect two cuts to rates this year, in July and November, after Fed Chair Powell pushed back strongly against the possibility of further rate hikes at his press conference last week.

Corporate profit reports have been better than expected not just in the United States but also in Europe and Japan as global earnings growth is on track for a second straight quarter following four consecutive declines.

Earnings this week include: yesterday – BCC, GT, BRK.A, FRPT were up and SAVE and TSN were down; today – PLTR, MCHP and Dow component DIS are lower while SPG is higher; tonight - ANET, CROX, DDOG, ROBT; Wednesday – CHK, YYD and UBER; Thursday – AKAM, RBLX, YELP; Friday – AMCX.

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