To The Moon

The S&P 500 climbed 0.2% to secure its third record close of the year, as investors breathed a sigh of relief over the Federal Reserve’s January meeting minutes.

📊 Market Highlights:

• $S&P 500(.SPX)$ : 🔼 +0.2% (Record Close 🎉)

• $NASDAQ(.IXIC)$ : 🔼 +0.07% (Third Highest Close Ever) $Tesla Motors(TSLA)$ $SUPER MICRO COMPUTER INC(SMCI)$  $Palantir Technologies Inc.(PLTR)$ $Apple(AAPL)$

• Dow Jones: 🔼 +71 points (+0.2%)

💡 Key Takeaways from the Fed Minutes:

• No Surprises: The Fed is in no rush to cut interest rates, emphasizing the need for "further progress on inflation" before making changes.

• Taking It Slow: The FOMC agreed the central bank is "well-positioned to take time" to assess economic growth, labor, and inflation.

• Market Calm: Unlike a few months ago, investors didn't panic at the idea of rates staying high. A sign of growing patience?

💰 Fed Rate Cut Timeline:

The FRED graph above shows a scatter plot of monthly values of the unemployment and job openings rates, as reported by the US Bureau of Labor Statistics. Between December 2000 and October 2024, the Beveridge curve is more or less shaped like a banana, but with a long tendril during the years of the COVID-19 pandemic. A closer inspection of post-pandemic labor market data, however, shows a steady decline in the rate of job openings and only a modest increase in the rate of unemployment.

A plot of the unemployment and job openings rates

FRED

• March Meeting (Mar 19): ❌ 98% chance rates stay the same

• May Meeting: ❌ 12% chance of a cut

• June Meeting: ⚖️ Just under 50% chance of a cut

💬 David Russell, TradeStation: "Another nothing burger from the Fed… They’re taking a back seat to the Executive Branch for now."

🛍️ Walmart Earnings on Deck

• Reports – kicking off big-box retail earnings season. $Wal-Mart(WMT) $Alibaba(BABA)$ $KraneShares CSI China Internet ETF(KWEB)$

• Analysts expect a strong quarter due to robust holiday spending.

• Key Question: Will Walmart’s guidance signal consumer strength or caution?

The market's patience with the Fed will soon be tested, but for now, investors are riding the record-breaking wave 📈.

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This summary is for informational purposes only and does not constitute financial advice. Investors should conduct their own research before making investment decisions.