Market Insights

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Check out our next “State of the Market,” on Monday, 1/27.

Sizing Up the S&P 500

• S&P 500 returns to 6,100 short-term indicators go bullish
  • MACD rising
  • 8-day EMA above 21-day EMA
• Breadth improves
  • Stocks above 20-, 50-day MAs surge. New 52-week highs improve
• Sector mix is potentially bullish
  • Risk on: Technology, communications, industrials surge
  • Safe havens: Utilities, consumer staples, real estate lagging
• Recent swing in sentiment, breadth potentially reminiscent of November 2023
• Potential support at 6,050 (highs on 12/26, 1/21)
• Three-month period of neutrality may have resolved in a bullish direction.

S&P 500, daily chart, with key patterns and indicators.

Is Apple Faltering?

• Of the 8 megacaps ($1 trillion+ market cap), AAPL is the only with a negative return this year (-11%)
  • Price action potentially mirrors late 2023, with new high in December followed by months of weakness
• Timeline of negative news:
  • 1/7: MoffettNathanson cuts to sell, citing lack of AI traction, China risks.
  • 1/10: Ming-Chi Kuo of TF Securities sees market-share losses in China. Says that Apple Intelligence hasn’t boosted iPhone sales.
  • 1/10: Mark Zuckerberg criticizes AAPL for “random rules,” lack of innovation.
  • 1/13: IDC says iPhone market share falls to 23.2% in Q4 of 2024 from 24.7% in Q4 of 2023 as Xiaomi grows.
  • 1/13: Counterpoint Research says AAPL has fallen behind Samsung as Chinese rivals gain ground.
  • 1/15: Canalys says AAPL loses top position in global smartphone market as Vivo, Huawei gain in China.
  • 1/17: AAPL temporarily halts AI news summaries amid accuracy concerns.
  • 1/21: AAPL downgraded by Jefferies, Loop Capital
• Could AAPL resemble other companies that struggled while losing long-term dominance?
  • Years of success and stable profits can discourage innovation, foster complacency and keep multiples high.
  • “Lean and mean” competitors can display significant momentum after a phase of modest growth.
  • Historical examples: General Motors, Blackberry, Boeing, Intel, Kodak, Nokia, IBM

Using the Platform

• $20DMAASP: Custom symbol tracking S&P 500 stocks above their 20-day MAs. (More details here.)
• Sharp increases can reflect sudden rapid breadth improvements followed by periods of steady gains with small pullbacks
  • EasyLanguage: close data2 – lowest(close data2,19)
  • This shows the last value’s distance above the lowest reading in the last 19 days. Results above a threshold can generate signals.
• Last occurrence: 1/17
• Other instances: 8/26/24, 5/8/24, 11/15/23, 10/18/23
• Note: It can also mark bearish tops in downward-trending markets

Upcoming Events

• Mon 1/27: New home sales
• Tue 1/28: Durable goods orders
  • Earnings: GM BA RCL SBUX
• Wed 1/29: Crude oil inventories, *Fed meeting*
  • *META* *MSFT* *TSLA* NOW
• Thu 1/30: *GDP*, Initial jobless claims
  • Earnings: *AAPL* INTC CAT MA UPS