May 21, 2023

The Weekend Rip: May 21, 2023

Strength in the tech sector, foreign stocks, and regional banks helped push the U.S. stock market indexes higher despite the debt ceiling uncertainty. 👀

Let’s recap and prep you for the 4.5-day week ahead. 📝

What Happened?

📈 The Nasdaq 100 hit 13-month highs, and the S&P 500 hit 8-month highs. Internationally, Japan’s stock market indexes both hit 33-year highs as stocks continue to climb the “wall of worry.”

🤩 This week’s Stocktwits Top 25 report showed outperformance relative to the indexes.

⚠️ Retailers continue to paint a cautious picture of the U.S. consumer. Home Depot chopped its forecast, and Target offered a mixed outlook. Walmart did manage to beat and raise its guidance, buoyed by strong grocery demand. Other retailers that reported included Canada Goose, Foot Locker, The Container Store, and Sea Ltd.

📺 It was a busy week for the media and entertainment space, with news impacting Microsoft, Activision, NeoGames, Vice Media, Verizon, and more. Two popular stocks among retail investors, Rumble and FaZe, both failed to impress.

🏟️ Madison Square Garden Entertainment reported its first set of results as a standalone company, with shares hitting new heights.

🤖 A number of tech stocks issued results this week, they should Take-Two seconds to review. Monday.com also had a good week after beating estimates.

🚜 The world’s largest farming equipment maker, Deere & Co., reported solid results but still fell as investors fear its results can’t possibly get better.

🔥 Several names were on the Stocktwits trending tab for most of the week, including $XELA, $OMH, $TRKA, $MULN, and $PLTR.

Here are the closing prices:

S&P 500	4,192	+1.65%
Nasdaq	12,658	+3.04%
Russell 2000	1,774	+1.89%
Dow Jones	33,427	+0.38%

Bullets

Bullets From The Weekend

🚫 China prohibits some of Micron’s products over security concerns. The country’s cyberspace regulator said that certain products made by U.S. memory chip manufacturer Micron Technology failed its network security review. As a result, it’s planning to bar operators of key infrastructure, which range from the transportation to finance industries, from buying products from the firm. Micron acknowledged it received the CAC’s notice, but it did not detail what risks it found nor what products would be impacted. Reuters has more.

🤔 Several Federal Reserve officials grow skeptical about rate pauses. This week’s public speeches from the Fed’s top officials indicated a growing discourse about whether the committee should hike interest rates another 25 bp at the June meeting or pause as the market expects. Earlier this month, they voted unanimously to raise the benchmark rate to 5-5.25% while signaling a possible pause ahead. However, headline inflation remains well above their 2% target, and core inflation’s downward progress has slowed to a crawl. More from CNN Business.

🤖 Google challenger Neeva abandons consumer search and bets on AI and enterprise. The California-based company revealed that it’s winding down its consumer business after facing significant challenges in attracting new users. “There is no longer a path towards creating a sustainable business in consumer search.” Of course, the harsh economic headwinds are pressuring even the most prominent tech players, so it’s unsurprising that a startup taking on Google’s consumer search business would struggle. With that said, the company is looking for a new life as it pivots resources toward enterprise licensing deals and a standalone generative AI search app, “Gist.” TechCrunch has more.

The Brief

Need a concise summary of what’s going on this week? Look no further. Here’s an overview of important earnings and economic data for the trading week ahead.

Economic Calendar

The back half of the week is busy with economic data, with the front half focused on Fed speeches. Investors will be watching Friday’s Core PCE Price Index and personal income/spending data as they try to ascertain the Fed’s next move. In addition to the above, check out this week’s complete list of economic releases.

Earnings This Week

Earnings season continues to slow, with 155 companies reporting. Some tickers you may recognize are $NVDA, $SNOW, $PATH, $INTU, $ZM, $XPEV, $DECK, $COST, $MDT, $BBY, $TOL, and more.