What happened in the market: 10 Jun - 14 Jun 2024
Aries Yuangga, Wakil Penasihat Berjangka
As we delve into the intricate dance of financial markets, the week of June 10-14, 2024, stands out as a period marked by significant economic indicators and policy announcements that reverberated through various sectors. This article aims to provide a comprehensive analysis of the past week's market movements, examining the key events and data that shaped investor sentiment and market dynamics. We will explore the performance of major indices, highlight the top movers and shakers, and provide an outlook for the upcoming week, including crucial economic releases and earnings reports.
Last Week at a Glance
The week of June 10-14 was pivotal for the markets, primarily driven by the Federal Reserve's June meeting and the latest U.S. inflation data, which brought both optimism and caution to investors. The headline Consumer Price Index (CPI) for May reported a year-over-year increase of 3.3%, slightly below the forecasted 3.4% and down from April's 3.4%. Core inflation, excluding volatile food and energy prices, showed a modest decline to 3.4%, below expectations. This cooling inflation data suggested easing inflationary pressures, offering a breath of fresh air to the markets. The Federal Reserve maintained its benchmark interest rate at 5.25%-5.5%, but updated projections indicated only one rate cut in 2024, down from three anticipated in March. This cautious yet confident stance emphasized the Fed's aim to reach a terminal rate of 3.1% by 2026. The combination of favorable inflation data and the Fed's steady approach provided a stable backdrop, encouraging bullish sentiment, particularly in growth-sensitive sectors. The Dow Jones Industrial Average closed at 38,589, down 0.5% for the week, while the S&P 500 ended at 5,432, up 1.6%. The NASDAQ rose to 17,689, gaining 3.2%, driven by strong performances from mega-cap tech companies like Alphabet and Nvidia. Conversely, the MSCI EAFE declined by 1.4% to 2,335, reflecting global economic uncertainties.
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:
Adobe (ADBE): 🎨 Surged by more than 14% following its quarterly earnings report, which exceeded market expectations. The software giant reported robust revenue growth, driven by strong demand for its creative and digital media solutions. Adobe’s optimistic outlook and strategic initiatives in AI-powered tools also contributed to investor enthusiasm.
Boeing (BA): ✈️ Experienced a 1.9% decline after news broke about the Federal Aviation Administration (FAA) opening an investigation into counterfeit titanium used in some of its recently manufactured planes. This issue raised concerns about potential delays and additional costs for the aerospace company.
Hasbro (HAS): 🧸 Climbed by 6% after Bank of America upgraded the stock from "neutral" to "buy," citing the toymaker's promising digital gaming strategy. The upgrade was based on expectations that Hasbro’s focus on digital gaming could drive significant earnings growth in the coming quarters.
Nucor (NUE): 🏗️ Saw a modest gain of 0.4%, rebounding from initial declines after the steelmaker announced that its second-quarter earnings would be significantly lower than the previous year. The company attributed the drop to lower average selling prices but reassured investors with a stable long-term outlook.
RH (RH): 🛋️ Faced a substantial decline of 17% after reporting a larger-than-expected loss for the first quarter. The luxury retailer cited weaker demand and higher operating costs as the primary factors behind its disappointing results.
ZScaler (ZS): 🔐 Gained 1.8% after JPMorgan Chase upgraded the cloud security company from "neutral" to "overweight." The upgrade was based on strong growth prospects in the cybersecurity sector and ZScaler’s expanding market share.
The Week Ahead: June 17 - 21, 2024
The upcoming week promises to be eventful, with several key economic releases and corporate earnings reports that could influence market movements.
Retail Sales Data (June 17): This report will provide insights into consumer spending, a critical component of economic growth. Analysts will be looking for signs of resilience in consumer behavior amid the ongoing economic uncertainties.
Industrial Production and Capacity Utilization (June 17): These indicators will shed light on the health of the manufacturing sector and overall industrial activity. Investors will be keen to see if production levels are maintaining momentum.
Housing Starts and Building Permits (June 18): The housing market's performance is a crucial indicator of economic health. This data will offer clues about the future pace of construction activity and housing supply.
Existing Home Sales (June 19): Alongside housing starts, existing home sales data will provide a comprehensive view of the housing market, including demand trends and price dynamics.
Initial Jobless Claims (June 20): Weekly jobless claims data will be monitored for any signs of stress in the labor market. A rising trend in claims could indicate weakening employment conditions.
Philadelphia Fed Manufacturing Index (June 20): This regional manufacturing survey will offer additional insights into the manufacturing sector's performance and sentiment.
Key Earnings Reports:
KB Home (KBH): 🏡 Scheduled to report, KB Home’s earnings will be scrutinized for insights into the housing market's health and the impact of higher interest rates on home buying activity.
Lennar (LEN): 🏘️ Reporting as well, Lennar’s results will provide valuable information on the housing market, including new home sales, pricing trends, and margins.
Conclusion
The week of June 10-14, 2024, highlighted the delicate balance between economic indicators and market sentiment. Favorable inflation data and a steady Federal Reserve stance provided a stable backdrop, encouraging positive market movements, particularly in growth-sensitive sectors. Major indices reflected mixed performances, with the NASDAQ benefiting the most from robust tech stock performances. Individual stocks like Adobe and Hasbro experienced significant gains due to strong earnings and strategic upgrades, while Boeing and RH faced declines from regulatory and financial setbacks.As we look ahead to the week of June 17-21, 2024, investors will focus on crucial economic releases such as retail sales data and housing market indicators. Earnings reports from major homebuilders like KB Home and Lennar will offer further insights into the housing market's health and the broader economic outlook. The interplay of these factors will likely shape market dynamics, making it essential for investors to stay informed and adaptable in their strategies.
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.
