CEO Sightings

Tech Titans Propel Markets to New Highs Despite Fed's Caution on Rate Cut

By:JJ Kinahan

Meanwhile, Boeing is regaining altitude and Macy's is laying off workers and closing stores

  • Tech stocks are leading a market surge, while strong earnings and momentum are driving the Nasdaq toward new record high.
  • The Federal Reserve is signaling a potential divergence from the market as economic indicators show resilience.
  • Boeing is rebounding with the help of a major aircraft deal, Macy's is cutting job cuts and the the EU is exercising a veto.

In the dynamic landscape of the market, technology stocks continue to dominate the narrative. Yesterday, the S&P 500 saw a nearly 1% gain, while the Nasdaq Composite surged by 1.3%. Notably, the Nasdaq 100 closed at a new record high of $412.99, marking a milestone in its upward trajectory. These gains occurred despite positive economic indicators and diminished expectations of a March rate cut.

Taiwan Semiconductor ( TSM) set the tone for the day by reporting earnings that surpassed expectations and projecting a revenue increase of over 20% in 2024. This announcement fueled a 5% gain for the day, contributing to positive momentum in the tech sector. Market favorite Nvidia (NVDA) extended its run, consistently setting new record highs and adding another 2% to the success that began the previous year. The momentum extended to other tech giants, with Apple (AAPL) experiencing a 3% surge, reaching a new high for 2024 following an upgrade by Bank of America (BAC). Meanwhile, shares in Netflix (NFLX) gained 1%, and both Meta (META) and Google's parent company, Alphabet (GOOG), approached all-time highs.

Interest rates could remain stubbornly high

At the start of the year, there was widespread optimism that the Federal Reserve would cut interest rates multiple times in 2024. However, the market, which had priced in up to six cuts, faced a discrepancy with the Fed's forecast of only three. Then, yesterday's weaker-than-expected initial jobless claims report reinforced the notion that the economy remains robust while inflation is on a downward trend. Later in the day, data on existing home sales, expected to reach 3.82 million, provided further insight.

Throughout the week, various Fed officials attempted to temper expectations of a rate cut in March. Market sentiment, as reflected in Chicago Mercantile Exchange (CME) data, showed a decline in the probability of a quarter percentage point rate cut from over 70% to just 54%. Following today's developments, members of the Fed will enter a blackout period, refraining from discussing monetary policy until the conclusion of their meeting scheduled meeting for the end of the month.

Boeing is flying a bit higher

Boeing (BA), grappling with a significant stock decline of up to 40% this year, witnessed a nearly 3.5% increase after India's privately held Alaska Air announced the purchase of 150 737 MAX aircraft. In other news, retailer Macy's (M) disclosed plans to cut 3.5% of its workforce (2,350 jobs) and close five stores. The European Union's competition watchdog announced its intention to veto an $1.7 billion Amazon (AMZN) proposal to acquisition of iRobot, causing a 35% premarket drop in iRobot's shares.

The House and Senate approved a short-term spending bill, which is awaiting President Biden's signature to keep the government funded until March. This sets the stage for another round of budget discussions. Additionally, January expiration for stock options adds an interesting element, especially for longer-term options or long-term equity anticipation securities (LEAPs). Traders may engage in significant activity as they settle positions entered a year ago. Stocks like the “Magnificent Seven” (Apple, Amazon, Alphabet, Nvidia, Meta, Microsoft (MSFT) and Tesla (TSLA) could experience heightened volume, given their substantial gains in the past year. As always, the advice remains consistent: adhere to your investing plan and long-term objectives in navigating the evolving market landscape.

JJ Kinahan is CEO of IG North America—which includes tastylive, tastytrade and IG's FX Business. Kinahan traded for 21 years at the Chicago Board Options Exchange. He serves on the CBOE Advisory Board and the SIFMA Options Committee. @thejjkinahan 

For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro.

Trade with a better broker, open a tastytrade account today. tastylive, Inc. and tastytrade, Inc. are separate but affiliated companies.

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Related Posts

tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.  Options, futures, and futures options are not suitable for all investors.  Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on

tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.

tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.

tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.

© copyright 2013 - 2024 tastylive, Inc. All Rights Reserved.  Applicable portions of the Terms of Use on apply.  Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.