Commentary- Testing AI News For This Week 

US stocks have started the new year with a dip, as tech giant Apple's stock slipped about 4% following a downgrade from Barclays. Though the S&P 500 came close to a new record high after a strong winning streak last year, the stock market rally is now on hold. Economic updates this week, including the December jobs report, may influence future trends. Oil prices rose after Iran deployed a warship to the Red Sea, escalating tensions with the US. Bitcoin prices also increased to over $45,000, marking a significant recovery from early 2022. Meanwhile, Tesla beat expectations with record delivery figures for Q4 of 2023. Source: Yahoo Finance

The US financial market has been the subject of several Wall Street analyst calls. Among the significant movements, Citigroup has received an upgrade from Wolfe Research, meanwhile, Charles Schwab was downgraded by Goldman Sachs due to the risk of interest rate cuts. Wolfe Research also named JPMorgan Chase as a top pick amongst banks. KeyBanc Capital Markets has shown optimism on the wireless industry by upgrading Verizon. Goldman Sachs suggested that Apple stands to benefit from a predicted 2024 PC demand recovery. In contrast, investment bank KBW has shown caution on SoFi Technologies, predicting further losses. Tesla received a pessimistic outlook from Bernstein analysts, who suggested that shares could fall nearly 40% as the brand may struggle to increase sales in 2024 and 2025. Source: CNBC

Six experts weigh in on the real estate outlook in 2024

The US real estate market faces a year of highs and lows in 2024, experts predict. Home sales may receive a boost from a slow decline in mortgage rates throughout the year and a slight increase in housing inventory due to a slight uptick in single-family construction. Despite new construction, the shortage in housing inventory is still predicted to persist for several years to come due to a decade of underbuilding. Double-digit increases in real estate activity are anticipated in top-growth areas across the country. An election year will likely trigger volatility in mortgage rates, with estimates fluctuating in the mid-6% range. Home prices are expected to rise modestly, at an average of 4%. Despite these shifts, mortgage rates remain well above pandemic-era record lows, and the number of multifamily units under construction is the highest it's been since 1973, foreshadowing future impacts on the rental market. This outlook provides valuable insights for traders looking to make informed decisions in the housing market and the construction industry. Source: USA Today

US futures slip, bond yields rise as rate-cut bets cool 

US stock futures saw a slight decrease as bond yields rose due to declining expectations of swift interest rate cuts. Ahead of upcoming jobs data and the Federal Reserve minutes release, futures for the Dow Jones and the S&P 500 dropped by 0.3%, while the Nasdaq 100 fell by roughly 0.5%. Increasing pessimism led to the worst start to a year in decades for bond prices and stock indexes. The 10-year Treasury yield is anticipated to spike up to approximately 4%. Market expectations for Federal interest-rate cuts have reduced, as reflected in the CME FedWatch Tool data, which shows that 74% of traders are now pricing in a March pivot, down from 89% the previous week. Source: Yahoo Finance

Interest Rates Are Set to Fall in 2024. History Says This Is What Will Happen to the Stock Market. 

Interest rates are predicted to fall in 2024, in what would be a correction of the Federal Reserve's aggressive rate increases to counter inflation. The stock market is expected to benefit from the rate cuts, as historical trends show that when interest rates decrease, stock valuations rise. Despite this generally positive outlook, the potential for stocks to surge might be affected by the anticipation of these decreases, as many investors have already accounted for the rate cuts. Other factors like continued progress in generative AI, corporate earnings growth, and strong economic data may help sustain the recent market rally. The unique aspect of this rate-cut cycle is that it doesn't coincide with a recession, contrary to previous cycles. The expected rate cuts and their impact on the stock market is being closely watched by US traders. Source: The Motley Fool

Gold surrenders modest intraday gains, looks to US macro data and FOMC minutes 

Gold prices are failing to maintain earlier intraday gains, pulling back to the lower end of the daily trading range during the first half of the European session on Wednesday. The resilience of the US dollar has attracted some buyers, enhanced by ongoing doubts over an early prospective interest rate cut by the Federal Reserve. Increasing US Treasury bond yields are also creating headwinds for gold, a non-yielding asset. Market pricing does suggest the US central bank could begin easing its monetary policy as early as March. Ongoing concerns around a fragile economic rebound in China and geopolitical risks might help keep gold's losses at bay. Traders look likely to sit on their hands for now, waiting for US macro data release and the outcome of the Federal Open Market Committee (FOMC) meeting for insight into possible Fed policy moves. Upcoming releases include the US ISM Manufacturing PMI and Job Openings data. Source: FXStreet

Oil product stocks rise after 16% annual drop 

The stockpiles of oil products at the UAE's Port of Fujairah climbed 10% during the last week of December, ending the year with a 16% annual drop, according to S&P Global. The increase was driven by a record 55% jump in light distillates such as gasoline and naphtha. Despite this rise, 2023 did see declines in heavy distillates and residues amid strong demand for low-sulfur fuel oil and aggressive selling in high-sulfur oil for shipping. Product exports from Fujairah also fell in 2023 due to a decline in fuel oil shipments. The data suggests demand and supply movements in 2024 should be monitored by U.S. traders for potential impact on global oil markets. Source: S&P Global

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