INTRADAY ALERT: Solid Dec Jobs report adds concerns Fed "higher for longer" and adds to misery of early 2024. Just a reminder 1H24 is likely tough.

The video in this report is only accessible to members
The video in this report is only accessible to members
The video in this report is only accessible to members

The first 4 trading days of 2024 have been a terrible start for equities with S&P 500 ($SPY) down -1.6% and the Russell 2000 (small-caps, $IWM) down -3.5%. As our members are aware, for the last few years (the case for longer), the year tends to play out in January. Meaning, this turmoil in the first week of trading is telling us to brace for a challenging year. We still see S&P 500 rising to 5,200 by YE 2024, but as we noted in our 2024 Year Ahead, we believe stocks will be trickier in 1H24 and the bulk of gains are realized in 2H24.

The list of concerns in the first week of 2024 is large but here are some notables:- Dec FOMC minutes show a Fed that might be slower to cut rates- as noted multiple times recently, we expect markets to get "itchy" about cuts- hence, chance for stocks to be soft until this framework is clear- recent incoming data shows economic resilience (claims, jobs report)- raising concerns Fed may not be in a rush to cut rates in line with market expectations- blockade in Middle East raises marginal concerns of pickup in inflation- interest rates have crept up since Dec 27, pressuring equities- VIX has crept up since Dec 27, pressuring equities Seasonal concerns also come into play:- Santa Claus rally failed (5 last days o...

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