uploaded image

Clothing Giants Lead Market Surge as Earnings Season Kicks Off and Bitcoin Booms

By:JJ Kinahan

Investors await Powell's Testimony and jobs data amid uncertainty over a possible cut in interest rates

  • The retail sector is surging buoyed by strong earnings as investors eye clothing retailers' quarterly performance.
  • Bitcoin is climbing, benefiting from stretched equity valuations as investors seek alternative assets.
  • Economic focus is intensifying with Powell's testimony, jobs data and limited expectations for a March interest rate cut.

Stocks kicked off March with a strong start, as the S&P 500 rose by nearly 1% and the Nasdaq Composite climbed over 1%. The day's gains were led by familiar names, with Nvidia (NVDA) up 3.7%, Advanced Micro Devices (AMD) rising 5%, and Super Micro Computer (SMCI) gaining 4.6%.

Advancing issues outnumbered decliners, with options volume notably robust, exceeding its recent average by 20% according to the Cboe. This week promises more earnings reports with those from clothing retailers arousing particular interest. There will also be a slew of economic data to digest.

Target (TGT) is set to report earnings before the market opens tomorrow, followed by Nordstrom (JWN) after the close. Abercrombie and Fitch (ANF) will report on Wednesday morning, and Gap (GPS) and Costco (COST) will announce earnings after Thursday's market close.

The clothing sector's performance is of particular interest, given the significant gains witnessed in stocks like Nordstrom, which has surged around 50% since November. Abercrombie's substantial growth, with shares more than quadrupling since last year, reflects broader strength in the retail market, often overlooked amid headlines dominated by AI, bitcoin and concern about inflation.

Macy's (M) is attracting attention as Arkhouse Management and Brigade Capital Management raise their bid to acquire the company, offering $24 per share, up from $21, valuing Macy's at $6.6 billion. Additionally, Deckers Outdoor Corp. (DECK) and Super Micro Computer, Inc. are set to join the S&P 500, underscoring ongoing index reshufflings.

On the economic front, Federal Reserve Chair Jerome Powell's testimony before Congress, along with the JOLT (Job Openings and Labor Turnover Survey) report on job openings and the February employment report, will be closely watched. Market expectations for a rate cut in March are minimal, with a mere 26% probability, rising slightly to 70% for June, according to the CME Group.

Meanwhile, Bitcoin (BTC) continues to make waves, trading above $65,000 in premarket trading. The cryptocurrency's ascent is seen as a reflection of stretched equity valuations, with fund managers seeking alternative investment avenues amid limited choices. Consequently, a pullback in bitcoin prices may hinge on a corresponding downturn in equities.

As investors navigate market dynamics, adherence to long-term investment strategies remains paramount. Despite the noise surrounding headline-grabbing assets like bitcoin, prudent decision-making aligned with individual financial objectives is essential.

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.com/disclosures.

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 tastylive.com 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.