ZUMZ - Wall Street Eyes Strong Start Ahead Of More Inflation Data Gold & Bitcoin Dip: Why This Analyst Looks Beyond AI For Growth | Benzinga
As traders harbor hopes that the Federal Reserve will take down interest rates in the first half of the year, the broader trend is to the upside amid occasional minor corrections. Stock futures are pointing up on Thursday. The February producer price inflation and retail sales data could direct traders’ sentiment for the day, and if these pan out in line with expectations, the broader market could resume their climb. Bond yields, however, tell a different story, and have been on an uptrend in recent sessions.
Cues From Previous Session:
The lack of any major catalyst kept sentiment subdued on Wednesday, with tech stocks serving as drags. The major averages opened on a mixed note, with the Nasdaq Composite and the S&P 500 Index declining, while the Dow Jones Industrial Average was higher at the open.
The former two indices languished mostly below the unchanged line before ending lower, while the Dow held above the unchanged line for a majority of the session before ending modestly higher. The 30-stock blue-chip average received support from a strong rally in 3M Co. (NYSE:MMM) after the company announced a new CEO.
IT, real estate, healthcare, and consumer discretionary stocks experienced weakness, while energy and material stocks were among the biggest gainers.
Index Performance (+/-) Value
Nasdaq Composite -0.54% 16,177.77
S&P 500 Index -0.19% 5,165.31
Dow Industrials +0.10% 39,043.32
Russell 2000 +0.30% 2,071.71
Analyst Color:
Delving into the reasons behind the market’s optimism since the October 2023 lows, Morgan Stanley’s Lisa Shalett said easy financial conditions and excitement about AI are driving the surge, despite persistently high rates and negative earnings revisions.
The analyst, however, cautioned against investors pinning much hope on these going forward. Liquidity infusion into the financial system from banks, money markets, and government stimulus programs that more than offset Fed tightening may finally be drying up and excess savings cushions are nearing exhaustion, she said.
Shalett viewed that ...