Wall Street’s whipsaw run is set to continue into Thursday’s open with US pre-market futures trading lower, across the board, after a record-breaking retracement cut benchmark losses following a turbulent run-up to Christmas.
The stock market attempted to shake off two sessions of sharp declines as the Dow surged +4.86%, recording its largest daily point gain in its history; meanwhile, the S&P 500 and Nasdaq both advanced +5% and +6.24% respectively – with the +5% gain in the S&P 500 index reducing the benchmark’s December losses to -10.6%, after having fallen by as much as -15%.
With a lack of clear catalysts for the sharpness of the moves, investors and Trump administration officials pointed to unusually large year-end re-balancing from pension funds as a factor driving the rally, following a punishing ten-session losing streak on Wall Street.
Although, despite the move, history shows that miracle resurrections in equities are unlikely to be sustained. In eight previous bear markets, the S&P 500 has experienced rallies of greater than +2.5% more than 120 times as the benchmark plunged from peak to trough. (According to data compiled by Bloomberg.)
In today’s economic data, investors will likely review the latest CB Consumer Confidence figures from the month of December and New Home Sales data for the month of November at 10am EST.
TODAY’S TOP HEADLINES:
China & Trade: China Heads into Trade Talks Bracing for More US Demands. (Bloomberg)
China enters trade talks said to begin early next month in Beijing having made concerted efforts to end the standoff with the US, and also unsure it’s done enough.
Russia: Russia plays down idea of forming joint organization with OPEC given US sanctions risk. (CNBC)
It is highly unlikely that OPEC and other oil producers would set up a joint structure due to the additional red tape it would create as well as the risk of US monopoly-related sanctions, Russian Energy Minister Alexander Novak said on Thursday.
North America: Trump Makes Surprise Visit to American Troops in Iraq. (The NYT)
President Trump visited American military forces on Wednesday in Iraq, making his first trip to troops stationed in a combat zone only days after announcing his intention to withdraw the United States from foreign wars in Syria and Afghanistan.
Today’s Economical Announcements
08:30AM – Weekly jobless claims (12/22) (Previous: 214,000)
09:00AM – House Price Index (YoY) (Oct) (Previous: 6.0%)
09:00AM – House Price Index (MoM) (Oct) (Previous: 0.2%)
09:00AM – House Price Index (Oct) (Previous: 266.9)
10:00AM – CB Consumer Confidence (Dec) (Previous: 135.7)
10:00AM – New Home Sales (Nov) (Previous: 544K)
10:00AM – New Home Sales (MoM) (Nov) (Previous: -8.9%)
STOCKS IN THE SPOTLIGHT:
Pre-Market Movers & News Related Stocks
Boston Scientific (BSX): [NEWS] The medical device maker exercised its option to purchase the remaining shares of heart surgery device maker Millipede. It had originally made a $90 million investment in Millipede in January, with an option to buy the remaining shares for $325 million.
JD.com (JD): [NEWS] JD.com is launching an extensive revamp of its operations, according to The Wall Street Journal.
JPMorgan Chase (JPM): [NEWS] JPMorgan will pay $135 million to settle claims that it improperly handled transactions involving foreign company shares. The alleged mishandling of American Depositary Receipts (ADRs) occurred between 2011 and early 2015, according to the Securities and Exchange Commission.
Apple (AAPL): [NEWS] Apple supplier Foxconn may start making higher end iPhones in a plant in India in 2019, according to a Reuters report.
Visa (V): [NEWS] The payments network operator will pay $250.6 million to buy British payments firm Earthport, which specializes in international transactions for banks and businesses.
CBS (CBS): [REVIEW] Loop Capital reiterated a “buy” recommendation on CBS shares, saying the company has the most favorable risk/reward profile of the media companies it covers.
Verizon (VZ), Walt Disney (DIS): [NEWS] Verizon and Disney are headed toward a contract expiration deadline on December 31 which could result in the disappearance of Disney-owned channels for Verizon FiOS customers.
General Dynamics (GS), Huntington Ingalls (HI), and Oceaneering International (OII): [NEWS] Defense contractors were awarded Navy contracts for submarine modernization and maintenance.
Nvidia (NVDA): [DOWNGRADE] RBC Capital lowered its price target on the graphics chip maker’s stock to $200 per share from $230, noting that average selling prices have coming down in secondary markets.
Plantronics (PLT): [NEWS] Plantronics will pay $36 million to settle foreign bribery allegations involving its Polycom unit.
GAINERS: TNDM, IMMU