The stock market had its struggles last week dealing with rising interest rates, fading rate cut expectations, and valuation angst. One can make a case that politics played a part, too, as inflation concerns, borne out of tariff proposals, and deficit concerns, borne out of tax cut proposals, had a hand in market rates going up and expectations for the number of Fed rate cuts going down.<\/p>\n\n\n\n
Market participants will be grappling with the same issues this week in the midst of hearing earnings results from NVIDIA (NVDA)<\/strong> after Wednesday’s close and earnings results from a host of retailers, including Walmart (WMT), Lowe’s (LOW), Target (TGT), TJX Cos. (TJX)<\/strong>, and The Gap (GAP)<\/strong>, throughout the week.<\/p>\n\n\n\n The early approach is mixed as rates remain elevated and the mega-cap stocks themselves are mixed. The geopolitical scene has gotten murkier, too, with The New York Times<\/em> reporting that President Biden approved Ukraine’s use of U.S. long-range missiles in Russia.<\/p>\n\n\n\n Currently, the S&P 500 futures are up four points and are trading fractionally above fair value, the Nasdaq 100 futures are up 67 points and are trading 0.3% above fair value, and the Dow Jones Industrial Average futures are down 41 points and are trading 0.1% below fair value.<\/p>\n\n\n\n The 10-yr note yield, sitting at 4.46%, is again pushing 4.50%, which has been an area associated with multiple compression over the past 18 months or so. The 2-yr note yield is up to 4.30%.<\/p>\n\n\n\n The elevated rates have tempered buy-the-dip interest in the stock market along perhaps with the news that President-elect Trump has tapped Brendan Carr, someone who has been a critic of large technology companies, to be FCC Chair. Chris Wright, CEO of Liberty Energy (LBRT)<\/strong>, has been nominated for Secretary of Energy.<\/p>\n\n\n\n