To The Moon

We saw Thursday (13 Feb) market having major U.S. indices ticked higher after President Donald Trump signed an executive order instructing his administration to investigate reciprocal tariffs but stopped short of immediately imposing the taxes.

The release of the latest Producer Price Index (PPI) data did not trigger similar market action we saw with the Wednesday (12 Feb) Consumer Price Index (CPI) report, though both show an uptick in the data, PPI showed that wholesale inflation in January have increased.

Advancers outpaced decliners by more than a 3-to-1 margin on the NYSE and approximately 5-to-2 on the Nasdaq. The Russell 2000 climbed 1.2%, the S&P Midcap 400 rose 0.9%, and the equal-weighted S&P 500 increased by 0.9%.

Investor confidence was further boosted by the understanding that President Trump's proposed reciprocal tariff plan might not be as economically disruptive as initially feared. The S&P 500 closed the session 1.04% higher. The DJIA was up by 0.77%, while NASDAQ rose by 1.5% which was boosted by the strength in the tech sector.

Reaction To Jan PPI Different To CPI (Inflation Concerns)

The release of the January Consumer Price Index (CPI) on Wednesday caused some inflation concerns in both the stock and Treasury markets. However, Thursday's release of the January Producer Price Index (PPI) did not trigger further inflation worries.

While the headline numbers does not seem to be reassuring, but market participants felt that the upcoming PCE Price Index, due on 28 February, might not present an inflation shock.

This sentiment was bolstered by month-over-month declines in components such as airfare and physician care, influencing the Treasury market and enabling the stock market to continue its recovery efforts.

All Eleven S&P 500 Sectors In The Green

The positive momentum in the stock market saw all eleven S&P 500 sectors closed the session higher in the green, with Materials the biggest winner with 1.71% boosted by Smurfit WestRock plc (SW) 7.30% gains.

Consumer Discretionary sector was up 1.60% which was helped by MGM Resorts International (MGM) 17.46% gain, with $Tesla Motors(TSLA)$ giving 5.77% gain also.

Information Technology sector was also up 1.52% which $Intel(INTC)$ and Super Micro Computer (SMCI) both gained more than 6% to help boost the sector

Communication Services sector also rose 1.08% where Warner Bros Discovery Inc. (WBD) gain of 3.92% played a part in boosting the sector.

Note Yield Decrease Initially Then Rose Modestly

We saw the 2-year note yield decreased by six basis points to 4.31%, before rising back slightly to 4.311%, while the 10-year note yield dropped by 11 basis points to 4.53% (which was the level before the CPI release), then it rose back to 4.537%.

The significant move in the 10-year note yield was notable, although it was overshadowed by the S&P 500's approach to its record closing high of 6118.71.

Stocks To Watch

$ARM Holdings(ARM)$ saw its shares rise nearly 6% after reports emerged that Meta Platforms (META) signed on as the first customer for Arm's own chip. This development indicates Arm's strategic move into chip production, potentially placing it in competition with key customers like $NVIDIA(NVDA)$.

You can take a look at my earlier article on ARM - Why Arm Holdings (ARM) Is Emerging As Pivotal Player In AI Sector

Though we seeing competition from ARM with its key customers, I believe their products and services could complement each other in large deployment.

$Coinbase Global, Inc.(COIN)$ reported robust Q4 results with a GAAP EPS of $4.68, surpassing expectations by $2.55. Revenue soared 138% year-over-year to $2.27 billion, exceeding estimates by $430 million. The company anticipates strong Q1 2025 performance, projecting substantial transaction revenue and increased marketing expenses due to heightened trading volume and USDC rewards.

If you have read my article on COIN earnings, I believe that COIN is in a good position to gain with crypto rally, though we are seeing Bitcoin trading rather range-bound around $95k to $96k, we could be seeing investors sentiment coming back with fund inflow later when we have more clarity on Fed decision on interest rate.

I am expecting COIN to continue to push higher, but one important note is the level to defend is the 26-EMA, which is around $280 level, as long as COIN could stay above it, and the bulls continue to try building a daily uptrend expansion, we could be seeing some buying sentiment coming back.

But if the bulls failed, then $280 might present an opportunity to gather COIN.

Roku (ROKU) shares surged by over 13% after the company reported a Q4 GAAP EPS of -$0.24, beating expectations by $0.17. Revenue increased by 21.9% year-over-year to $1.2 billion, driven by a rise in platform revenue and streaming hours. The growth in average revenue per user and streaming households contributed to the positive market reaction.

Summary

We could see the rally continuing on Friday (14 Feb) as traders and investors start to navigate who are the winners and losers of upcoming tariffs. We could be seeing some more strength coming from the big tech names.

Appreciate if you could share your thoughts in the comment section whether you think market could continue the rally from Thursday and semiconductor names continue to make the gains.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.