What happened in the market: 17 June - 21 June 2024
Aries Yuangga, Wakil Penasihat Berjangka
As we reach the midpoint of 2024, the financial markets continue to be a critical barometer of the broader economic environment. The week of June 17 to 21, 2024, offered a mix of economic data, corporate earnings, and market movements that provided investors with both opportunities and challenges. In this comprehensive review, we will dissect the significant events that shaped the markets, analyze the top movers and shakers, and preview what to expect in the coming week.
Last Week at a Glance
The week of June 17 began with a relatively calm market as investors digested previous data and awaited new economic reports. The Federal Reserve's decision to pause its rate hikes continued to reverberate through the financial system, with previous tightening measures still impacting the economy and early signs of consumer fatigue emerging. Despite this, rising stock and housing prices boosted household net worth to new records, creating a wealth effect that supported consumer spending. Inflationary pressures, though moderated from their peaks, continued to affect consumer sentiment, particularly among low-income households, as reflected in the University of Michigan Consumer Sentiment Index, which fell to a seven-month low in June, and the Conference Board's Consumer Confidence Index, which remains 20% below its pre-pandemic level. Despite mixed signals from consumers, U.S. stock markets had a positive week, with the Dow Jones Industrial Average closing at 39,150 (up 1.5%), the S&P 500 finishing at 5,465 (gaining 0.6%), and the NASDAQ ending at 17,689 (flat but up 17.8% year-to-date). Key economic data included slower-than-expected retail sales growth for May, a 0.5% drop in the Conference Board's Leading Economic Index, and strong performances in the services and manufacturing sectors as indicated by the S&P Global Flash PMI.
Top movers & shakers🎢
Several individual stocks made headlines with significant price movements driven by a variety of factors, including quarterly earnings reports, analyst ratings, and strategic announcements. Among the notable movers were:
Hertz Global Holdings (HTZ): 🚗 Surged by 16% following the company's announcement to increase a bond offering from $750 million to $1 billion. This strategic move is aimed at strengthening Hertz's balance sheet and supporting its growth initiatives in the competitive car rental market.
Nike (NKE): 👟 Rose by 1.7% after Oppenheimer Holdings upgraded the stock from "perform" to "outperform" and increased its price target. The upgrade reflects optimism about Nike's turnaround and potential significant progress in its recovery from previous sales slumps, with quarterly results expected next Thursday.
Palo Alto Networks (PANW): 🔐 Experienced a 3% gain following positive analyst coverage. D.A. Davidson initiated coverage with a "buy" rating and a price target of $380, citing the company's strong competitive positioning and exceptional financial performance, boosting the cybersecurity firm's stock.
Spirit AeroSystems (SPR): ✈️ Surged by 6% on reports that Boeing is nearing a deal to repurchase the supplier. This potential acquisition is seen as a strategic move by Boeing to consolidate its supply chain and enhance manufacturing capabilities, providing a significant boost to Spirit AeroSystems' market performance despite Boeing's stock being down 32% for the year.
Nvidia (NVDA): 💻 Despite a stellar year, Nvidia's stock experienced a 4% decline over the week, breaking an eight-week winning streak. The drop was attributed to potential technical "reversal" signs noted by chart analysts, which could indicate further declines. Nevertheless, Nvidia remains a key player in the AI boom, and investor sentiment towards the stock continues to be largely positive.
The Week Ahead: June 24 - 28, 2024
The coming week is packed with important economic data releases that will be closely watched by investors and policymakers alike:
PCE Inflation Data (June 28): The Personal Consumption Expenditures (PCE) price index, the Federal Reserve's preferred inflation gauge, will be the most closely watched data release of the week. Recent CPI data has come in cooler than expected, fueling hopes of a Fed rate cut later in the year.
Consumer Confidence Index (June 25): The Conference Board will release its June Consumer Confidence Index, providing insights into consumer sentiment and spending behavior.
Durable Goods Orders (June 27): The Census Bureau will report May's durable goods orders, offering a snapshot of business investment and manufacturing health.
Final Q1 GDP (June 27): The government's final estimate for first-quarter GDP will be released, providing a comprehensive view of economic growth at the start of the year.
Key Earnings Reports:
Several major companies are set to report their quarterly earnings in the coming week, providing further insights into corporate health and sector performance:
Nike (NKE): 👟 Scheduled to report on Thursday, investors will be looking for signs of recovery in sales and profitability following a period of underperformance.
FedEx (FDX): 📦 Reporting on Tuesday, FedEx's earnings will be closely scrutinized for indicators of global shipping demand and operational efficiency.
Micron Technology (MU): 💾 Set to release its earnings on Wednesday, Micron's performance will provide insights into the semiconductor industry, which has been a focal point of market interest this year.
Conclusion
The week of June 17 to 21, 2024, showcased the financial markets' resilience amid mixed economic signals. Despite consumer sentiment dampened by lingering inflationary pressures, U.S. stock markets posted gains driven by robust corporate earnings and optimism in AI stocks. Key movers included Hertz, Nike, Palo Alto Networks, Spirit AeroSystems, and Nvidia. As we look ahead, significant economic data releases and earnings reports from major companies like Nike, FedEx, and Micron Technology will be pivotal. Staying informed and adaptable will be crucial for navigating the evolving market landscape and making strategic investment decisions.
Source:
https://www.schwab.com/learn/story/schwab-market-update
https://www.edwardjones.com/us-en/market-news-insights/stock-market-news/stock-market-weekly-update
*Disclaimer:
This information is provided for general information purposes only. Consider your investment objectives, financial resources and other relevant circumstances carefully before investing. This is not an invitation or an offer to invest, nor is it financial advice or a recommendation to buy or sell any investment.
