Wall Street closed Thursday’s trading session [Jan 18] with sharp gains, following the publication of the latest jobless claims data, which revealed that demand for unemployment benefits in the country fell to its lowest point since September 2022.
- US weekly initial jobless claims unexpectedly fell by -16,000 to a 16-month low of 187,000, indicating a stronger than expected labor market of 205,000.
- December new housing starts in the US fell -4.3% m/m to 1.460 million, stronger than expectations of 1.425 million. December building permits, which represent future construction, rose +1.9% month-on-month to 1.495 million, stronger than expectations of 1.477 million.
- The US Fed’s January business outlook survey in Philadelphia rose +2.2 to -10.6, weaker than expectations of -6.5.
Atlanta Fed President Bostic said he would like to see more evidence, that inflation is on track towards the Fed’s target of 2%, and he said his view is that the first rate cut will occur in the third quarter of this year.
At the closing bell, the USA100 skyrocketed 1.47% and the USA500 jumped 0.88%. The best performing company of both indices was Fastenal Company whose shares increased by 7.18%. The USA30 rose 0.54%, while Boeing Co rose 4.24% to lead the gains in the Dow Jones Industrials after winning an order for 150 Max jets from India’s Akasa Air. Apple closed up over +3% leading gainers in the Dow Jones Industrials, after Bank of America upgraded the stock to buy from neutral with a $225 price target.
The USA100 recorded a new record high (17000.50). A rally in chip stocks on Thursday pushed tech stocks higher, after Taiwan Semiconductor Manufacturing Co, a major supplier to Apple and Nvidia, said it expects a return to solid growth this quarter. As a result KLA Corp, Applied Materials, ASML Holding NV, Lam Research and Qualcomm closed up more than +4%. Additionally, NXP Semiconductors NV, Micron Technology, Broadcom and GlobalFoundries closed up over +3%.
From a technical perspective, the USA100 recorded a new historical January 2024 record at 17000.50 in Thursday’s trading [Jan 18] surpassing the record price of 16991.00 last December. Further rally is yet to be capped, but is projected for FE61.8%FR at 17463 [from 10431.30-15946.40 and 14054.80 pullbacks]. However, profit-taking cannot be ruled out going forward. Interim support is seen at 15946.40 to contain future declines.
Stock outperformance was supported by easing political risks, after the Senate passed a continuing resolution that would fund the government through March and avoid a shutdown on Saturday. This temporary measure will fund some US agencies until March 1 and others until March 8. The House is expected to vote on and pass the bill later today.
Click here to access our Economic Calendar
Ady Phangestu
Market Analyst – HF Educational Office – Indonesia
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
