S&P 500 will open with yesterday’s markets rallying to fresh new highs. This time, China technology stocks bounced back when the media speculated that the government would inject a stimulus.
Alibaba (BABA) gained an impressive 7.85%, Baidu (BIDU) rose by 7.49%, and JD.com (JD) added 7.2%. Consider dismissing the speculation of the government saving stocks. Local governments are highly strained financially. They are not collecting property tax from land transfers as real estate sales fall. Expect big moves on those three stocks today.
For ETF traders, the consumer staples ETF (XLP) and communications services (XLC) were the top performers on Tuesday. Verizon (VZ) and Proctor & Gamble (PG) both posted strong quarterly results. They should follow through today with an uptrend. Conversely, 3M (MMM) lost over 10% yesterday. The firm reported a 0.3% drop in revenue in the fourth quarter. For 2024, 3M expects sales growth of 0.25% to 2.25%.
In the media sector, Netflix (NFLX) is a big winner today. Last night, it posted the highest subscriber growth since the pandemic. Paid membership grew by 12.8% to 13.12 million. Price hikes and cost cuts are increasing Netflix’s profit margin. In Q4, operating margin was 16.9%.
Netflix is now benefiting from the decision to cut password sharing. By removing free-riding access, investors expect profits to expand for the next few quarters ahead.
