The market’s euphoric bull market that began last Sept. 2023 through January 31 ended, at least for now. Although the FOMC did not change interest rates, Fed Chair Powell said that rate cuts in March are too soon.
U.S. Treasury yields rose after the news. The 2-year T-bill yield increased 54 bps to 4.25% while the 30-year fell 49 bps to 4.19%. “HFL,” or higher interest rates for longer, strengthens the U.S. dollar. Watch the DXY and UUP ETFs, which track the currency.
Before the market opens, earnings reports from Altria (MO), Merck (MRK), and Royal Caribbean (RCL) will lift them to the most actively traded stocks today. After the market closes, Apple (AAPL), Amazon (AMZN), and Meta Platforms (META), three of the magnificent 7, post results. Yesterday, heightened ad revenue growth expectations sent Alphabet (GOOG) stock down by 7.35%. GOOG stock is still at all-time highs not reached since the 2022 tech stock peak.
Last night, Qualcomm (QCOM) posted earnings of $2.75 a share on $9.92 billion in revenue. Shares popped by 2.7% initially, only to trade nearly flat. The semiconductor sector needs to rebound after AMD posted weak graphic chip sales and disappointing revenue growth. AMD stock trades at a price-to-earnings ratio of 320 times. Its forward P/E of 30.2 times indicates how much profit growth markets expect from the firm.
