As we begin the first trading day in 2024, markets look to start the new year with questions on the health of the economy and if the recent rally has been overdone. Nasdaq down over -1.5% in the early trading. Apple down close to -3% in the morning trade as an analyst at Barclays warned that iPhone demand may be cooling off. Not all are scared of the recent run-up in stocks or questions on the economy, Tom Lee at Fundstrat Global Advisors expects stocks to do well this year and noted that the first five days of Jan can set the tone for the year, so we will see if this tone changes. At any rate, stocks are due for a cooldown after finishing the year hot.
Markets aren’t just starting off negatively on the US side, China sentiment was dampened even further after Prez Xi Jinping acknowledged that some companies and citizens had endured a difficult 2023, a rare admission of Chinese economic headwinds. Adding to this pressure, people familiar mentioned that ASML Holding NV, which makes semiconductor equipment, canceled shipments of some of its machines to China at the request of US Prez Joe Biden.
D.E. Shaw’s largest hedge fund returned 9.6% in its flagship Composite fund while the S&P 500 returned over 26% for 2023. Bottom-line: markets were tough to navigate as multistrategy and macro hedge funds posted a wide range of results in 2023 due to unusually high volatility in the US bond market and equities gaining, mostly on the backs of several big tech companies.
Crypto and Bitcoin look to start off the 2024 year on an extremely hot note, rising above $45,000 for the first time in almost two years. Investor confidence in a potential bitcoin ETF approval continues to shine. On Friday, BlackRock and other potential issuers updated the registration forms for their proposed bitcoin ETFs and investors are reading into this as evidence that a possible decision by the SEC may be coming soon.
Tesla reported a record quarter of deliveries in Q4 with the stock only slightly up in the early trading. The carmaker left two “highly anticipated” numbers out of its latest quarterly production and deliveries release: how many Cybertrucks the company built and sold the last few weeks of 2023. Tesla instead grouped its debut pickup together with the Model S and X. To note, the Model Y SUV and Model 3 sedan accounted for 95% of vehicles sold in the quarter.
More on China… China home prices shrink at a quicker pace in December after major cities relaxed homebuyer curbs, per Bloomberg.
Trade disruption fears are on the minds of traders this morning as attacks by Iran-backed Houthis have already disrupted shipping. Iran’s dispatch of a warship to the Red Sea is a further challenge to US forces in the key trade route, raising tensions. In response to these attacks, some of the world’s largest shipping companies have refused to travel through the Suez Canal, complicating flows between Europe and Asia.
