Daily Sector Snapshot — 12/4/24
Chart of the Day: Two Years of ChatGPT and AI
Fixed Income Weekly — 12/4/24
Searching for ways to better understand the fixed income space or looking for actionable ideas in this asset class? Bespoke’s Fixed Income Weekly provides an update on rates and credit each week. We start off with a fresh piece of analysis driven by what’s in the headlines or driving the market in a given week. We then provide charts of how US Treasury futures and rates are trading, before moving on to a summary of recent fixed-income ETF performance, short-term interest rates including money market funds, and a trade idea. We summarize changes and recent developments for a variety of yield curves (UST, bund, Eurodollar, US breakeven inflation, and Bespoke’s Global Yield Curve) before finishing with a review of recent UST yield curve changes, spread changes for major credit products and international bonds, and 1-year return profiles for a cross-section of the fixed income world.
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Q3 2024 Earnings Conference Call Recaps: Dollar Tree (DLTR)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Dollar Tree’s (DLTR) Q3 2024 earnings call.
Dollar Tree (DLTR) operates a network of discount retail stores under the Dollar Tree and Family Dollar banners. The stores provide everything from household essentials and groceries to seasonal and discretionary items, with a focus on value and affordability. DLTR’s unique multi-price format, offering items primarily at $1.25, and Family Dollar’s expanded assortment cater to customers stretching their budgets. The company’s store network offers insights into consumer behavior, particularly among low- to middle-income households during economic shifts. This quarter, DLTR reported a sequential improvement in comps, with multi-price 3.0 stores contributing 30% of DLTR’s Q3 net sales. Converted stores posted a 3.3% comp, supported by a 6.6% consumables comp. Consumer behavior reflected economic pressures, with increased focus on “buying for need,” boosting consumables sales. Family Dollar showed progress in discretionary categories, achieving its first positive comp since 2022. Holiday sales are poised for growth despite fewer shopping days, with an expanded seasonal assortment. The company continues a strategic review of Family Dollar, exploring sale or spinoff options. After last quarter’s poor results that sent shares tumbling 22%, better-than-expected results this quarter boosted the stock modestly at the open on 12/4…
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Biggest Winners and Losers Since the Election
It’s been nearly a month now since the Presidential election, and from the close on 11/5 through yesterday (11/3), 354 (71%) stocks in the S&P 500 have experienced gains and the average performance of all 500 stocks in the index has been a gain of 3.89%. Of the ones that have rallied since the election, 13 have posted gains of at least 20%, and we have listed each one below with one-year price charts below that. Of the 13 biggest winners, most of them were already big winners leading up to the election, and all but four are currently up over 40% YTD. Looking at the charts, it’s also worth noting that the only four that experienced reversals in their trends around the election were EPAM Systems (EPAM), Super Micro Computer (SMCI), Tesla (TSLA), and Warner Brothers Discovery (WBD). In most cases, the reason for these reversals had little to do with the election and were more company-specific events. EPAM and WBD both reported earnings two days after the election, and SMCI had news related to hiring a new auditor. Tesla (TSLA) is the only stock that really saw a notable shift in its trend due to the election, and given CEO Elon Musk’s role as the right-hand man to President-Elect Trump, that move is understandable.
Turning to the losers, only 12 stocks in the S&P 500 were down 10% or more between 11/5 and the close yesterday (12/3). Unlike the list of biggest winners, though, some of these names, especially in the Health Care sector, were in steady uptrends ahead of the election but have seen those rallies reverse. Shares of Leidos (LDOS) were also at 52-week highs just after the election but have plunged since, as Vivek Ramaswamy has discussed the large amounts of bloat in funding for federal contractors. In several cases, though, the declines have been company-specific.
Finally, within the “Trillion-Dollar Club”, most have seen gains but to varying degrees. Leading the way higher, TSLA has rallied nearly 40% (Elon’s bet really paid off!), and next on the list is Apple (AAPL) with a gain of 8.6%. There’s been a lot of talk about Mark Zuckerberg not being welcomed at Mar-a-Lago, but it hasn’t impacted the stock of Meta Platforms (META) as it has rallied 7.2%. Behind META, the other members of the “Trillion-Dollar Club” that have outperformed the S&P 500 are Amazon.com (AMZN), Berkshire Hathaway (BRK/B), and Microsoft (MSFT), which have rallied 7.0%, 5.7%, and 4.8%, respectively. That leaves Alphabet (GOOGL) and Nvidia (NVDA) as the only two members of that club that have underperformed the S&P 500 since the election.
As with anything, it’s tempting to look at these recent performance numbers and extrapolate the out or under-performance throughout the entire Trump Administration, but remember that it hasn’t even been a month yet, so expect a lot of changes along the way.
Q3 2024 Earnings Conference Call Recaps: Salesforce (CRM)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Salesforce’s (CRM) Q3 2025 earnings call.
Salesforce (CRM) is a global leader in customer relationship management (CRM) software, offering a comprehensive platform that integrates sales, service, marketing, commerce, analytics, and more. Powered by AI and data-driven insights, CRM helps businesses automate workflows, engage customers, and optimize operations. With its pioneering Agentforce platform, CRM is at the forefront of digital labor and AI transformation, showcasing how AI can revolutionize productivity across industries. This quarter, CRM highlighted the rapid adoption of Agentforce, its AI-powered digital labor platform, with over 200 deals closed since its October launch. The company reported $9.44 billion in revenue, up 8% YoY, with Data Cloud integrated into eight of its top ten deals. CEO Marc Benioff emphasized Agentforce’s scalability, projecting it could deflect 25%-50% of human service cases. The upcoming launch of Agentforce 2.0 was teased as a game-changer. Strong multi-cloud demand and international expansion also stood out, driving resilience in key industries like healthcare and manufacturing. CRM opened 10% higher on 12/4 on new excitement around digital labor, despite a miss on the bottom line…
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Bespoke’s Morning Lineup – 12/4/24 – A Perfect After Hours Session
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“If I read as many books as most men do, I would be as dull-witted as they are.” – Thomas Hobbes
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Markets are looking to start the day positively with several key economic reports and Fed speakers. The ADP Employment report just hit the tape and came in modestly weaker than forecasts. Still coming up, we have the ISM Services report at 10 AM which is expected to fall slightly from 56.0 down to 55.6. Besides the economic data, we’ll also get the Beige book at 2 PM Eastern and some Fed speakers, including the Chair himself who will appear at the Dealbook Summit at 1:45 Eastern.
There’s a lot of important economic and Fed-related data for the market to navigate today. Still, bulls can only hope that the news comes in as positive as yesterday’s earnings reports after the close. As mentioned in yesterday’s email, Salesforce (CRM) was the big report of the after-hours session. While expectations were already high, the stock exceeded the bar trading 13% higher in the pre-market. That puts it on pace for the largest upside gap in reaction to earnings since March 2023. If the gains hold through the end of the session, it would be the best one-day reaction to earnings since August 2020.
CRM may be a company with a market cap of $350 billion, but regarding earnings, it’s extremely volatile. Historically, the stock’s average one-day change in reaction to earnings has been nearly 7%, but as shown in the chart below, two of its last three reports have been followed by double-digit percentage moves in reaction to earnings. Typically, you expect stocks to become less volatile in reaction to earnings as they become larger, but as CRM and other mega-cap stocks have illustrated in recent quarters, that doesn’t always seem to be the case.
We showed this chart yesterday, but we wanted to update it to include yesterday and today. Provided CRM doesn’t reverse course and trade sharply lower on the session, today will be the 54th day in a row that the stock has closed at overbought levels (1+ standard deviations above 50-DMA). That’s already easily a record high, but with CRM trading 2.8 standard deviations above its 50-DMA this morning, there’s the potential for this streak to extend several more days.
What makes yesterday’s after-hours earnings news even more impressive is that CRM’s surge was relatively modest. Of the four companies that reported after the close with sales of $500 million or more, CRM is trading up the least and is the only one that didn’t report an earnings triple play! As shown in the table, Marvell (MRVL) and Okta (OKTA) are both up slightly more in the pre-market, and Pure Storage (PSTG) is trading up over 20%. It’s hard to remember another time when four mid-to-large companies reported earnings after-hours and they traded up at least 10%. Looking at how these companies traded heading into earnings, it’s not as though they hadn’t rallied into their earnings reports. As of yesterday’s close, all four were above their 50 DMAs, three were at overbought levels, and two were up over 50%!
The Closer – KISS Basket, Jobs, Korea – 12/3/24
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Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we start with an update of our KISS basket (page 1). We then dive into the latest jobs data in the form of the JOLTS report (page 2) and Indeed job postings (page 3). We then provide commentary regarding the situation in Korea (page 4) and close out with updates of the Logistics Managers Index (page 5) and Purdue Agricultural Barometer (page 6).
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Daily Sector Snapshot — 12/3/24
South Korea ETF (EWY) Reaching New Lows
Although US equities are mostly flat today, South Korean equities have been much more eventful. News broke today that the country’s President Yoon Suk Yeol declared martial law which was then contested by the National Assembly shortly thereafter. The catalyst for the declaration was claims to address what he described as communist/North Korean sympathetic parties conducting anti-state activities including budget disputes and impeachments. While the event is still unfolding, in response to the political tensions, the MSCI South Korea ETF (EWY) is down 2.35% as of this writing. That makes for the fifth straight day of declines, resulting in the ETF trading at its lowest level in over a year.
In the table below, we show the 22 country ETFs tracked in our Global Macro Dashboard (which was most recently updated last week). As shown, South Korea (EWY) is by far the worst performer today and it is also now the only one trading at a 52-week low too. In total, EWY is now down over 15% year to date with only Mexico (EWW) and Brazil (EWZ) falling more. Of those, EWZ is also the only country ETF that is now more oversold than South Korea. On the flip side, other Asian country ETFs like Japan (EWJ) and Singapore (EWS) have been moving higher into overbought territory.
