A daily market update from FS Insight— what you need to know ahead of opening bell.
“To expect the unexpected shows a thoroughly modern intellect.” — Oscar Wilde
Over the weekend
Stocks on Pace for Best Two Years in a Quarter-Century WSJ
Natural gas surges as much as 20% on expectations for colder-than-usual January on the East Coast CNBC
Biden Exits Battling for His Legacy and Believing He Could Have Won WSJ
Last Madoff victim fund payout brings recovery to nearly 94% of Ponzi scheme losses, DOJ says CNBC
Treasury Department Says Systems Hacked by China-Backed Actor WSJ
U.S. files complaint against fintech app Dave and its CEO CNBC
When Fewer Americans Are Buying Homes, These Companies Suffer WSJ
Stockpicking funds suffer record $450bn of outflows FT
South Korea issues arrest warrant for impeached President Yoon Suk Yeol FT
Why the Dollar’s Epic Rally Could Have a Little Further to Run WSJ
‘Most important man in accounting’ warns against lowering standards FT
The remote Kazakh Steppe that became a gateway to space CNN
Northern lights could be visible in upper fringes of the US this New Year’s Eve AP
Chart of the Day
| Overnight |
| S&P Futures +14
point(s) (+0.2%
) overnight range: -15 to +25 point(s) |
| APAC |
| Nikkei -0.96%
Topix -0.60% China SHCOMP -1.63% Hang Seng +0.09% Korea -0.22% Singapore -0.21% Australia -0.92% India -0.00% Taiwan -0.67% |
| Europe |
| Stoxx 50 +0.55%
Stoxx 600 +0.44% FTSE 100 +0.64% DAX -0.38% CAC 40 +0.92% Italy +0.07% IBEX +0.50% |
| FX |
| Dollar Index (DXY) +0.08%
to 108.22 EUR/USD -0.13% to 1.0393 GBP/USD -0.17% to 1.2529 USD/JPY -0.11% to 157.01 USD/CNY flat at 7.2993 USD/CNH -0.30% to 7.3374 USD/CHF -0.17% to 0.9052 USD/CAD -0.33% to 1.4403 AUD/USD -0.34% to 0.6200 |
| UST Term Structure |
| 2Y-3
M Spread narrowed -4.6bps
to -9.3bps
10Y-2 Y Spread widened 0.6bps to 29.5bps 30Y-10 Y Spread narrowed -0.4bps to 21.1bps |
| Yesterday's Recap |
| SPX -1.07%
SPX Eq Wt -1.01% NASDAQ 100 -1.28% NASDAQ Comp -1.19% Russell Midcap -0.91% R2k -0.75% R1k Value -0.96% R1k Growth -1.14% R2k Value -0.46% R2k Growth -1.02% FANG+ -1.18% Semis -1.51% Software -1.31% Biotech -1.60% Regional Banks -0.25% SPX GICS1 Sorted: Cons Disc -1.59% Materials -1.34% Healthcare -1.21% Cons Staples -1.20% Tech -1.09% SPX -1.07% Comm Srvcs -0.99% Indu -0.98% Fin -0.93% REITs -0.45% Utes -0.39% Energy -0.08% |
| USD HY OaS |
| All Sectors -1.1bps
to 328bps All Sectors ex-Energy -1.1bps 306bps Cons Disc -1.2bps 286bps Indu -0.9bps 247bps Tech -0.8bps 317bps Comm Srvcs -0.5bps 514bps Materials -0.7bps 302bps Energy -2.2bps 314bps Fin Snr -1.4bps 287bps Fin Sub -1.1bps 195bps Cons Staples -1.4bps 283bps Healthcare -0.4bps 385bps Utes -1.1bps 237bps * |
| Date | Time | Description | Estimate | Last |
|---|---|---|---|---|
| 12/31 | 9:00 AM | Oct Case Shiller 20-City m/m | 0.2 | 0.18 |
| 1/2 | 9:45 AM | Dec F S&P Manu PMI | 48.3 | 48.3 |
| 1/3 | 10:00 AM | Dec ISM Manu PMI | 48.2 | 48.4 |
| 1/6 | 9:45 AM | Dec F S&P Srvcs PMI | n/a | 58.5 |
| 1/6 | 10:00 AM | Nov F Durable Gds Orders | -0.3 | -1.1 |
MORNING INSIGHT
Good morning!
The weakness in the past week is probably simple profit-taking. After all, the S&P 500 is up 25% in 2024 and investors are taking tax losses now. To us, this explains a lot of this weakness. But this also does not mean stocks have to be weak for the foreseeable future.
Click HERE for more.
TECHNICAL
FS Insight Head of Technical Strategy Mark Newton is on vacation this week. He is scheduled to resume publishing Monday, Jan. 6, 2025.
CRYPTO
We break down why we believe profits from the HYPE airdrop are moving into Solana, Sui, and Base. We’ll also explain why we’re staying tactically cautious through the year end, discussing the key risks and factors that could influence market sentiment over the coming weeks.
Click HERE for more.
First News
The gaming industry, as a whole, had a great year, even as mass layoffs afflicted those who worked in it and some gamemakers floundered.
Readers may have engaged with video games even if they didn’t directly play any. Perhaps they watched a movie this year based on a game, bought Pokémon trading cards, or merchandise from T-shirts to Funko Pop.
Games no longer seem to be restricted to just niche circles and have instead entered mainstream society in a big way. But what many may not realize is that video games are a money-printing machine, too.
We will take a stock of a handful of the industry’s big moments in 2024 and preview what’s next.
1) Dungeons & Dragons: The classic tabletop game, which features gamers who role play as elves, warlocks, sorcerers, and more, recently celebrated its 50th anniversary. Its popularity rose even more after the “Stranger Things” show on Netflix and has inspired other popular video games like Baldur’s Gate 3 and even a blockbuster movie based on the game itself. The publisher of D&D says revenue has grown to $1.17 billion, as of October 2024, from $761 million in 2019. Along the way, D&D has also helped small businesses that host D&D nights grow. And a live D&D show, supposed to take place next month at Madison Square Garden, is already sold out, with average tickets going for $119.
2) Sonic the Hedgehog: The video game series featuring a small, speedy hedgehog was first released in 1991. Since then, the game has come a long way. In 2020, a movie based on Sonic was released. Following its great success, a follow-up film was released two years later. And this December, a third released with one of the highest ratings of any film this year. That has helped push the global gross for all three movies to almost $1 billion. That’s not all—a fourth one in the franchise was recently greenlit and could come in 2027.
3) Grand Theft Auto VI: The latest game in the franchise could release next fall and is estimated to exceed $1 billion in preorders before it even becomes available. Total revenue in the first 12 months is expected to reach $3.2 billion, which would set a new record in all entertainment media, not just the gaming industry, the FT reported.
4) Call of Duty: Black Ops 6 broke records at launch this fall and the franchise as a whole surpassed 500 million units sold, making it one of the best selling-game franchises of all time. The franchise releases a new game every year and it almost always tops the charts. Over its lifetime, the series has generated over $30 billion in revenue. Last year, Microsoft completed its acquisition of Call of Duty maker Activision Blizzard for $69 billion.
If this level of growth continues next year, the future for video games looks bright.