Stocks faltered out of the gates as investors continued to price in less conviction on rate cuts over 2024. Just a few weeks ago, bets on lower rates were at the forefront of minds until hotter-than-expected economic data began to re-adjust those expectations.
This Week on Wall Street - Week of February 20th
Market Commentary
Stocks faltered out of the gates as investors continued to price in less conviction on rate cuts over 2024. Just a few weeks ago, bets on lower rates were at the forefront of minds until hotter-than-expected economic data began to re-adjust those expectations. As we stand, markets removed the possibility of cuts in March while cuts in May now look less than likely. Even some economists have started to consider the next move by the Fed will be up, not down.
This week markets will get more Fed speak in addition to the Fed minutes from their meeting in January. Investors will be looking for any changes to a more hawkish rhetoric.
Newton scores are showing increased rotation as Large Caps took a back seat to Mid Caps and Small Caps. Additionally, we are seeing a positive rate of change in foreign names relative to domestic. On the fixed-income side, hotter inflation reads have caused bonds to show poor scores. Beneath the surface, Communications and Consumer Cyclical are on top. Consumer Defensives are at the bottom of the stack.
Stories to Start the Week
Capital One will buy Discover in a deal that combines major US credit card companies.
Another wet winter storm swamped California with heavy rainfall.
Former President Donald Trump unveiled a new line of shoes at Sneaker Con.
Bob Marley: One Love delivered a huge domestic opening, crushing Madame Web's start, a record worst for Sony's superhero adventure movies.
Economic Releases This Week
Monday: None
Tuesday: US Leading Economic Indicators
Wednesday: Fed Gov. Bowman Speaks, Minutes from FOMC's January Meeting
Thursday: Initial Jobless Claims, S&P Flash US Services & Manufacturing PMIs, Existing Home Sales, Fed Vice Chair Jefferson Speaks, Philadelphia Fed President Harker Speaks, Fed Gov. Cook Speaks, Minneapolis Fed President Kashkari Speaks, Fed Gov. Waller Speaks
Friday: None
What is Newton?
Our Newton model attempts to determine the highest probability of future price direction by using advanced algorithmic and high-order mathematical techniques on the current market environment to identify trends in underlying security prices. The Newton model scores securities over multiple time periods on a scale of 0-20 with 0 being the worst and 20 being the best possible score. Trend & level both matter.
Technical trading models are mathematically driven based upon historical data and trends of domestic and foreign market trading activity, including various industry and sector trading statistics within such markets. Technical trading models, through mathematical algorithms, attempt to identify when markets are likely to increase or decrease and identify appropriate entry and exit points. The primary risk of technical trading models is that historical trends and past performance cannot predict future trends and there is no assurance that the mathematical algorithms employed are designed properly, updated with new data, and can accurately predict future market, industry and sector performance.