Morgans AM

US equity markets advanced after a choppy session as investors eyed the outcome of the Senate runoff elections in the battleground state of Georgia, which will determine the balance of power in Washington - Dow added +168-points or +0.55%, with Boeing Co (up +4.5%) the leading index performer. The broader S&P500 rose +0.71%, with the Energy sector (up +4.53%) logging its best single-session advance since 4 December and leading ten of the eleven primary sectors higher. Chevron Corp gained +2.7% and Exxon Mobil Corp +4.82%. Real Estate (down -0.08%) was the only primary sector to settle in the red. Tiffany & Co announced after the closing bell that its holiday net sales reached a record high, up 2% thanks in large part to sales in China and online transactions. Costco Wholesale Corp lost -1.16% ahead reporting its December 2020 sales and revenue figures tonight AEST. The Nasdaq gained +0.95%. The small capitalisation Russell 2000 index gained +1.71%.

US equity markets opened 2021 with sharp falls, with the Dow and S&P500 retreating from record highs set on the final session of 2020 - Dow dropped -383-points or -1.25%, paring an earlier decline of as much as -700-points or -2.7%. It marked the first negative start to a new year for the Dow since 2016. Coca-Cola and Boeing were the worst-performing Dow components, falling -3.8% and -5.3%, respectively. The broader S&P500 lost -1.48%. Both the Dow and S&P 500 hit record intra-day highs in opening trading (of 30,674.28 and 3,769.99 respectively) before turning lower. The Nasdaq shed -1.47%. Taiwan Semiconductor Manufacturing Co (TSMC) is reportedly going to announce a 2021 capital expenditure plan of US$22 billion, ~10% higher than previously estimated, at an event on Thursday (7 January), according to Taiwanese media reports. TSMC acts as a manufacturer for major chip companies like Advanced Micro Devices Inc (up +0.6%) and Nvidia Corp (+0.5%) that do not have their own fabrication plants. Companies that supply the materials and make the equipment that manufacturers like TSMC use saw their shares rise, including Lam Research Corp (up +1.2%), KLA Corp (+0.6%), Applied Materials Inc +0.7% and U.S-listed shares of ASML Holding NV (+2.5%). Intel Corp slipped -0.3%. The small capitalisation Russell 2000 index fell -1.47%.

The Dow Jones Industrial Average and S&P500 carved out fresh record intra-day and closing highs to conclude a volatile 2020 that marked both the end of the longest bull market and the shortest-lived bear market ever - Dow gained +197-points or +0.65% to 30,606.48, with Intel Corp (up +2.2%) the leading Dow constituent on the final trading day of 2020. The broader S&P500 rose +0.64% to 3,756.07, with the Financials and Utilities advancing more than >1% each to be the leading primary sector performers last Thursday (31 December). Exxon Mobil Corp fell -0.9% after the energy giant said it expects higher oil and gas and chemical prices to boost fourth-quarter earnings, but confirmed that it is also expecting to write down US$18B to US$20B of upstream assets. Exxon Mobil’s shares declined more than >40% in 2020. Tesla Inc released fourth-quarter delivery figures on Saturday (2 January), with electric vehicle maker recording it delivered 180,570 vehicles in the fourth quarter of 2020 - a quarterly record for deliveries, ahead of consensus analyst projections of ~176K and up about 60% compared from the fourth quarter of 2019. For the full year, Tesla delivered ~499K vehicles, just short of initial management projections of 500K vehicles albeit the initial projections were before COVID-19 impacted the entire auto industry. Tesla 2020 vehicle deliveries grew ~36% compared with the full year 2019, despite pandemic, lock downs and production disruptions. Tesla stock’s +743% gain in 2020 leaves the company worth ~US$669B (having started last year with a market capitalisation of ~US$76B) - and almost US$780B on a fully diluted basis. The Nasdaq edged +0.14% higher. The small capitalisation Russell 2000 index slipped -0.26%.

US stocks rose slightly on Wednesday amid renewed vaccine optimism while traders looked for clues on additional fiscal stimulus. The Dow Jones gained +73.89 points, or +0.24%, the S&P 500 climbed +0.13% and the Nasdaq advanced +0.15%. Wednesday marked the fourth positive session in five for both the Dow and S&P 500.

US stocks slipped on Tuesday after reaching fresh all-time highs as traders weighed the possibility of even more fiscal stimulus being approved by Congress. The Dow Jones closed 68.30 points lower, or -0.2%, the S&P 500 dipped -0.2% and the Nasdaq fell by -0.4%. Tuesday’s decline snapped a three-day winning streak for both the Dow and S&P 500. All three of the major averages hit record highs at the open and at its session high, the Dow was up more than 100 points.

US stocks jumped to record highs on Monday to start the final trading week of 2020 after President Donald Trump signed an economic relief bill. The Dow Jones closed +204 points higher or +0.7%, the S&P 500 climbed +0.9% and the Nasdaq rose +0.7%.

US equity markets advanced, shrugging off a threat by President Trump not to sign a bill including nearly US$900B in pandemic relief - Dow up +114-points or +0.38% . The broader S&P500 eked out a +0.07% gain, having been up as much as ~0.7% earlier in the session. Cyclical sectors provided the market with some support, with Energy and Financials the two best-performing groups, rising +2.2% and +1.6%, respectively. The technology-centric Nasdaq eased -0.29%. The small-capitalisation Russell 2000 index logged its 13th record closing high of 2020, gaining +1. (to 1,989.88). President Trump said the stimulus package, agreed upon after months of wrangling in Congress, was “a disgrace” and that he wanted to increase “ridiculously low” US$600 payments for individuals to US$2,000.

US equity markets lost ground as COVID-19 concerns lingered - Dow lost -201-points or -0.67% . The broader S&P500 slipped -0.21%, with Energy (down -1.74%) leading the declines. Information Technology (up +0.86%) and Real Estate (+0.61%). Travel-related stocks came under pressure once again amid lingering concerns about a new variant of COVID-19 in the U.K. American Airlines dropped -3.9% and United Airlines fell -2.5%. Carnival -6%, while Royal Caribbean dipped nearly 3%. Norwegian Cruise Line slid 6.9% Nasdaq added +0.50% to log a fresh record closing high (12,807.92). Apple Inc rallied +2.85% as investors continued to support the company’s reported foray into self-driving vehicles. The small-capitalisation Russell 2000 index also logged record closing high, gaining +0.99% (to 1,989.88).

US equity markets settled with modest losses, clawing their way back from steep losses earlier in the session as investors weighed the outbreak of a more virulent new strain of COVID-19 against the passage of a long-anticipated US$900B stimulus package.- Dow added +37-points or +0.12%, erasing an earlier -400-point slide. Nike Inc gained +4.91% and hit a record high after posting better-than-expected fiscal second quarter earnings per share (US$0.78c versus analysts’ forecasts for US$0.70c) and sales (up +7% to US$11.2B versus consensus forecasts for US$10.55B) after the close of last Friday’s (18 December) session. JPMorgan Chase and Co (up +3.75%) and Goldman Sachs Group Inc (+6.13%) after the Federal Reserve announced late last Friday (18 December) it will allow the banking industry to resume share buybacks in the first quarter of 2021 following the results of the latest bank stress test. The broader S&P500 lost -0.39%, recovering from an earlier decline of almost 2%. Energy (down -1.80%), Utilities (-1.26%) and Consumer Staples (-1.05%) led the declines with falls of 1%+, while the Financials (up +1.24%) sector was comfortably the leading primary sector performer. Tesla Inc fell -6.49% on its first day of trading as a member of the S&P500 (with a 1.69% index weighting). A Reuters report that Apple Inc (up +1.24%) was pressing ahead with plans to produce electric vehicles in 2024 with its own version of self-driving car technology including a “breakthrough” battery design weighed on Tesla. Nasdaq slipped -0.10%. In merger and acquisition (M&A) news, Lockheed Martin Corp lost 1.9% after announcing it would buy U.S. rocket engine maker Aerojet Rocketdyne Holdings Inc for US$4.4B. Separately, International Business Machines (IBM) Corp shed -2.0% after saying it would acquire Finland-based start-up Nordcloud, in its latest effort to bolster its cloud-computing business.

US equity markets settled with modest losses despite rebounding somewhat late in the session, with all three key indices still hitting fresh record intra-day highs - Dow settled -124-points or -0.41% lower (at 30,179.05), paring a decline of over >270-points and after touching a fresh record intra-day high (30,342.59) at the opening of the session. The broader S&P500 eased -0.35% (to 3,709.41) amid a lot of rebalancing activity, snapping a three session winning streak and having touched an intra-day record peak of 3,726.70. Economic bellwether FedEx Corp fell -5.71% despite posting quarterly sales (US$20.6B) that topped >US$20B for the first time after the close of the previous session. FedEx also delivered better-than-expected earnings per share (EPS) of US$4.83 versus consensus estimates for US$4.01. The delivery company said year to date e-commerce volumes grew 33% faster than traditional retail. Moreover, FedEx expects e-commerce packages to triple, to 111M per day in 2026 from 35M per day in 2019. Both FedEx and United Parcel Service (up +0.4%) are an important part of the distribution chain for COVID-19 vaccines. Intel Corporation dropped -6.3% following a Bloomberg report that Microsoft Corp (-0.38%) was developing in-house chips for its servers and Surface PCs. Microsoft plans to develop a chip using Arm Holdings Plc designs for its data centres, and is exploring using another chip to power its PCs, according to the report. Advanced Micro Devices Inc lost -0.95%. Cybersecurity company Fortinet Inc (up +6.91%) was the leading S&P500 performer, buoyed by a recent spate of cyber attack disclosures from companies such as Microsoft. The technology-centric Nasdaq dipped -0.07% (to 12,755.64) after notching a record intra-day high of 12,809.60. Tesla Inc rallied +5.96% to a fresh record closing high (US$695) on heavy volume (over 200M shares or ~US$148B changed hands, more than quadruple the stock’s 30-day average trading volume and with Tesla trading more than the next 25 most active stocks combined) ahead of the company’s inclusion in the S&P500 index at conclusion of last Friday’s (18 December) session. Telsa will enter the S&P500 with a 1.69% weighting, the fifth largest in the index. Since the S&P announced on 16 November that the electric vehicle maker would be included in the S&P500 Tesla has added US$271.96B in market value, which is greater than Toyota Motor Co.’s market capitalisation (currently ~US$213B). Apple Inc (down -1.59%) closed all of its 54 stores in California over the weekend, with stores in about a dozen other U.S. locations already closed. About 80 of Apple’s 508 retail stores worldwide (including 270 in the US) are closed in total. The small capitalisation Russell 2000 index lost -0.41%.