In his Daily Market Notes report to investors, Louis Navellier wrote:
One-Day Santa Rally
Finally a decent bounce in the market. Let’s hope it holds.
Stocks rallied on the open after the continuing jobless claims number rose higher than expected (1,710K vs 1,686K forecasted), another case of bad news is good news. The rest of jobless numbers were in line with estimates.
Q3 2022 hedge fund letters, conferences and more
All industry sectors are higher in a relief rally. Interest rates are modestly lower; the US 10-year is down 3bps to 3.82%, and the 2-year flat at 4.36%. The US dollar index is down slightly to 103.8. Crude oil is softer, down to $77.5/bbl, natural gas continues down, off 4.6% to $4.46, back to levels not seen since March, down 35% in a month.
Gold and silver are essentially flat, as is crypto. We were overdue for a rebound, and a lot of the recent weakness may be explained by further tax loss selling once the Santa Rally didn't materialize.
On the international front, hopes for any near-term resolution in Ukraine were dashed by a heavy barrage of missiles by Russia. China's loosening of Covid restrictions has seen a response in several countries, including the US, to require Covid tests for inbound travelers from China, on fears that they may bring new more resistant variants of the disease.
Laggards Leading
Tesla Inc (NASDAQ:TSLA) has bounced, up 8% today and 12% off the recent low. The big tech-heavy QQQ is up 2.41% this morning but still down 1.4% in the last week. The laggards are leading today's recovery.
Looking toward 2023, we are seeing a wide range of early estimates for year-end 2023: In a survey of 22 Wall Street strategists, the average is 4.078, with a high of 4,750 from Fundstrat, and a low of 3,400 from BNP Paribas.
Clearly, we'll have further volatility into the new year with plenty of uncertainty about whether a soft landing is possible and if not how much resolve the Fed will have to not pivot if we tip into a serious recession.
For now enjoy the abbreviated one-day version of a Santa Rally, the best day in December.
Coffee Beans
The plan to live a healthier life is once again top of mind for Americans making resolutions for 2023. Vowing to exercise more, eat healthier and to lose weight were the top 3 New Year's resolutions in the U.S. this year. Source: Statista. See the full story here.
