Marketbites: Optimistic First Five Days
MARKET PERFORMANCE:
Portfolio Manager Commentary:
Gains in technology helped the Nasdaq Composite avoid losses on Monday as traders placed bets that inflation may be easing. Aided by a 6% increase in Tesla shares, the Nasdaq was able to gain 0.6%. Defensive drug stocks like Merck and J&J weighed on the Dow which lost 0.3%. Meanwhile, the S&P only lost 0.08% due to a gain of 1.1% in the information technology sector.
“The market, at least for 2023, seems a lot more optimistic than how we ended in 2022,” said Chris Zaccarelli, chief investing officer at the Independent Advisor Alliance. “Today is another one of those days where you’re really seeing growth outperform value, and you’re seeing a return to optimism in terms of what might happen for the stock market this year.”
Also, yesterday was the fifth trading day of the year and, according to a classic Wall Street rule, the market will end the year up if stocks perform well in the first five sessions. The S&P 500 has ended the year positive 83% of the times it finished the first five trading sessions up with an average gain of 14%.
Chart of the Day:
Brazilian markets came under pressure Monday after supporters of former President Jair Bolsonaro stormed the capital over the weekend. Investors had already been on edge about Brazil’s trajectory heading into this year. Leftist President Luiz Inácio Lula da Silva unveiled plans for big spending increases since beating out Mr. Bolsonaro in Brazil’s closest-ever presidential race in October. The Bovespa index has fallen around 5% since the election result.
Source: WSJ
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