Market Overview
The S&P 500 increased by 0.4% and the Nasdaq Composite rose by 1.5%, although both closed below their session highs. Conversely, the Dow Jones Industrial Average ended 0.3% lower after initially trading higher. Investors capitalized on the recent market weakness following last week's pullback, aligning with a typically strong period for equities in the latter half of December.At the start of the session, advancers outnumbered decliners by a 3-to-2 margin on both the NYSE and Nasdaq. By the close, the NYSE saw decliners leading advancers by the same margin, while the Nasdaq maintained a slight advantage for advancers.Interest Rates and Market Impact
Rising interest rates, which increased after unexpected inflation data, initially curbed buying interest. The 10-year Treasury yield increased by one basis point to 4.41%, with the 2-year yield rising similarly to 4.25%. Despite these pressures, certain stocks performed strongly, supporting the S&P 500 and Nasdaq. Notable gainers included Broadcom (AVGO 250.00, +11.2%), Alphabet (GOOG 198.16, +3.5%), and Tesla (TSLA 463.02, +6.1%), all achieving new 52-week highs.Sectors and Indices Performance
The equal-weighted S&P 500 fell by 0.3%, with declines in seven sectors. The energy sector experienced the largest drop of 2.2% due to falling oil prices ($70.83/bbl, -0.7%). Health care and materials sectors also saw declines of 1.3% and 1.0%, respectively. In contrast, the communication services (+1.3%), consumer discretionary (+1.7%), and information technology (+1.0%) sectors were the top performers.Year-to-date performance for major indices is as follows:- Nasdaq Composite: +31.3%
- S&P 500: +27.3%
- S&P Midcap 400: +17.7%
- Russell 2000: +16.5%
- Dow Jones Industrial Average: +16.0%
Upcoming Economic Events
This week, several significant economic reports will be released, including November's Retail Sales, Industrial Production, Housing Starts, Existing Home Sales, and Personal Income and Spending reports, which include the Fed's preferred inflation measure, the PCE Price Index. The FOMC's decision on Wednesday is the main event, with a 95.4% probability of a 25 basis points rate cut, according to the CME FedWatch tool.Economic Data Review
Recent economic data includes:- December NY Fed Empire State Manufacturing: 0.2 (consensus 10.0), prior 31.2
- December S&P Global US Manufacturing PMI - Prelim: 48.3, prior 49.7
- December S&P Global US Services PMI - Prelim: 58.5, prior 56.1
Upcoming Economic Data
For Tuesday, the following economic data is expected:- 08:30 ET: November Retail Sales (consensus 0.5%, prior 0.4%)
- 08:30 ET: Retail Sales, Ex-Auto (consensus 0.4%, prior 0.1%)
- 08:30 ET: November Industrial Production (consensus 0.3%, prior -0.3%)
- 08:30 ET: Capacity Utilization (consensus 77.3%, prior 77.1%)
- 10:00 ET: October Business Inventories (consensus 0.2%, prior 0.1%)
- 10:00 ET: December NAHB Housing Market Index (consensus 47, prior 46)
Global Markets
Overseas market performance:- Europe: DAX -0.5%, FTSE -0.5%, CAC -0.7%
- Asia: Nikkei -0.1%, Hang Seng -0.9%, Shanghai -0.2%
Commodities
Commodity prices:- Crude Oil: -0.46 @ 70.83
- Natural Gas: -0.06 @ 3.22
- Gold: -5.60 @ 267110
- Silver: +0.03 @ 31.10
- Copper: -0.01 @ 4.19
AVGO,GOOG,TSLA
Today's News
Rivian Automotive (RIVN, Financial) experienced a significant surge, climbing 6.75% in afternoon trading on Monday. Despite being down over 30% year-to-date, Rivian's recent 48% increase has outpaced Tesla (TSLA, Financial) over the last six weeks. The stock reached its highest level since late July, buoyed by positive sentiment from Benchmark analysts who see a large market opportunity for Rivian in the coming decade.
Quantum Computing (QUBT, Financial) led a rally in quantum stocks, surging 68% in late afternoon trading. The stock has soared approximately 370% over the past month, alongside D-Wave Quantum (QBTS, Financial) and Rigetti Computing (RGTI, Financial), which also saw substantial gains. Morgan Stanley analysts noted the growing investment interest in quantum technology, despite the lack of a clear catalyst for such rapid appreciation.
Alpha and Omega Semiconductor (AOSL, Financial) faced scrutiny after analyst Ming-Chi Kuo highlighted potential thermal issues with its chips used in Nvidia's (NVDA, Financial) systems. The concerns led to a 3% drop in AOSL shares, while Monolithic Power Systems saw a 4% increase. Nvidia's shares also fell, dropping into correction territory with a 1.7% decline.
EVgo (EVGO, Financial) announced a secondary offering of 23 million shares by LS Power Equity Partners, causing EVgo's shares to fall more than 15% in post-market trading. The company will not receive any proceeds from this sale, as all proceeds will go to LS Power.
Starbucks (SBUX, Financial) is increasing its paid parental leave as part of new CEO Brian Niccol's efforts to improve employee morale and retention. Birth parents will now receive 18 weeks of full paid leave, while non-birth parents will get 12 weeks. The move aims to address employee dissatisfaction amid a union movement and low customer traffic.
Affirm Holdings (AFRM, Financial) announced plans to offer $750 million in convertible senior notes due 2029, using proceeds to repurchase existing notes and shares. The offering is part of Affirm's strategy to manage its debt and share repurchase plans.
Sangamo Therapeutics (SGMO, Financial) saw its shares rise 24% after Roche decided to end development of a competing gene therapy for hemophilia A. Sangamo's therapy, licensed to Pfizer (PFE, Financial), now faces less competition in the market.
GuruFocus Stock Analysis
- Quantum Frenzy: How Rigetti Computing Stock Soared Over 220% in 2024 by Khac Phu Nguyen
- Nvidia and Broadcom Highlighted as Top Chip Stocks for 2025 by Bank of America by Faizan Farooque
- Ford Stock Skids: Jefferies Sounds Alarm on Inventory Glut and EV Gamble by Khac Phu Nguyen
- Nasdaq Soars to Record High as Tech Titans Lead the Charge--But Is the Rally Sustainable? by Khac Phu Nguyen
- AWS Commits $10 Billion to Expand Data Centers in Ohio; Amazon Stock Rises by Faizan Farooque
