S&P 500 Forecast: Early losses erased as equites bounce, tech still lags

Update 1100 EST: Well it's all going according to plan as early losses are erased and the S&P and Dow continue to recover from Friday's early lows. S&P is up 1%, Dow up 1.4%, and Nasdaq just hanging onto the coattails for a 0.1% gain. 

Sector by Sector: Consumer discretionary and financial stocks lead the way with Energy finally rolling over with the tech sector, both being the worst performing sectors.

Winners and Losers: AMC up 15%, Gamestop up 22%, WaltDisney up 4%, GE up 4%, Jets ETF up 3%. Baidu down 5%, JD.com down 4%, Snap down 3%.


Here is what you need to know on Monday, March 08:

Inflation fears haven't gone away despite Friday's remarkable session that saw markets completely turnaround from intraday lows. At one stage on Friday Tesla was down nearly 13% but staged a 9% rally to close 3.8% lower!  The strength of the jobs report caught investors off guard and initial panic ensued as the US10 Year rallied back to 13-month highs above 1.6%. But tech names had already suffered enough and bargain hunters changed the narrative, for now!

Monday sees markets remaining jittery with Asia seeing ugly losses again and Europe struggling for direction. The Dax is boosted by the EU-US suspension of tariffs as auto and export shares are boosted. The Dollar remains bid as EuroDollar sees off another big figure, now at 1.1855. Oil also continues to take strength from OPEC+ and is up 0.3% at $66.26 for WTI Crude. 

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European markets are mixed with the Dax being up 1.3% but FTSE down 1.2%. the EuroStoxx is down 0.2%.

US futures are shaky with the Nasdaq 1.5% lower, S&P 0.6% lower, and the Dow Jones 0.2% lower.

S&P 500 News

German industrial output fell 2.5% versus -0.4% expectation.

US stimulus bill passes through the Senate with some modifications to appease moderate Democrats. Bill goes back to the House and President Biden hopes to sign before the weekend.

Deutsche Bank survey shows half of 25-34 year olds will spend 50% of stimulus checks on stocks. 18-24 year olds are to spend 40% on stocks while 35-54 year olds will put just under 40% into stocks. Deutsche says “a large amount of the upcoming U.S. stimulus checks will probably find their way into equities.” Report from CNBC.

Attack on Saudi oil export facility fails but sees Brent rise above $70.

EU and US suspend tariffs on certain areas as White House says "to repair and revitalize the US-EU partnership."

EU looks to the US for AstraZeneca supply as shortage constraints still hurt Europe.

Tesla: Bloomberg reports Tesla is plugging a secret mega battery into the Texas power grid, a previously unknown gigantic battery construction project, entering Tesla into the US energy sector.

Disney: California said theme parks can reopen at reduced capacity from April 1, shares up 1% in the premarket.

Gamestop has asked Ryan Cohen to lead its digital e-commerce strategy, shares up 12% in the premarket.

GE: Nearing deal to combine its aircraft leasing business with AerCap Holdings in Ireland, according to the Wall Street Journal. The deal would be worth somewhere in the region on $30 billion. Shares in GE are up 2% in pre-market.

Xpeng Inc posted results for Q4 2020 showing revenue increased over 300% in Q4, expects revenue to be up over 500% in Q1 2021, and guides for 450% delivery growth in Q1. Shares are up 5% in pre-market.

Amazon: US lawmakers visited an Amazon facility in Alabama on Friday as a push to unionize workers increases-Reuters.

AT&T: SEC sues over allegedly releasing non-public information to research analysts-Reuters.

Johnson and Johnson: France health regulator says could approve vaccine by end of this week.

Morgan Stanley picks 10 best reopening stocks Airbus, Amadeus, ABF, Diageo, Informa, Meggitt, NatWest, Shell, Ryanair, and Sodexo.

AMC will release Q4 earnings on Wednesday.

American Airlines to offer $5 billion in notes to repay government debt-Reuters.

Ups and Downs

Accenture: price target raised by Susquehanna.

NextEra Energy: price target lowered by Credit Suisse.

NIO: price target lowered by Jefferies.

Bumble: coverage initiated by Goldman-neutral, Stifel-buy, JPMorgan-neutral, and morgan Stanley-equal weight.

Coca-Cola: RBC upgrades.

Economic releases (see all)

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