The Closer – Neutral Rate, NVDA, State JOLTS – 11/20/24

Log-in here if you’re a member with access to the Closer.

Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we lead off with a look into estimates of neutral rates in addition to NVIDIA (NVDA) earnings results (page 1).  We then provide a look into state level JOLTS data (page 2).  We also review the weak 20-year bond auction (page 3) and latest release of EIA data (page 4).

See today’s full post-market Closer and everything else Bespoke publishes by starting a 14-day trial to Bespoke Institutional today!

Fixed Income Weekly — 11/20/24

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.

Our Fixed Income Weekly helps investors stay on top of fixed-income markets and gain new perspectives on the developments in interest rates.  You can sign up for a Bespoke research trial below to see this week’s report and everything else Bespoke publishes for the next two weeks!

Click here and start a 14-day free trial to Bespoke Institutional to see our newest Fixed Income Weekly now!

Q3 2024 Earnings Conference Call Recaps: Symbotic (SYM)

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 Symbotic’s (SYM) Q4 2024 earnings call.

Symbotic (SYM) designs and manufactures cutting-edge robotic automation for supply chain and warehouse operations. Its proprietary SymBot technology automates tasks like palletizing and inventory management, generating significant cost savings, efficiency, and scalability for its customers. SYM primarily serves large retailers, wholesalers, and e-commerce businesses, including Walmart. The company’s innovations provide insights into automation trends and labor optimization, showcasing how robotics can reshape industries. SYM closed the quarter with record system deployments, highlighted by its first international customer, Walmex, adding $400 million to its backlog, and progress on GreenBox, its multi-tenant warehouse solution in Georgia. Technological advancements, like vision-enabled robots, were emphasized as differentiators. Gross margins rebounded to 19.6% as operational efficiencies improved, and strong top-line growth will be expected going forward. On in-line EPS and stronger revenue, the stock shot 27.7% higher on 11/19…

Continue reading our Conference Call Recap for SYM by becoming a Bespoke Institutional subscriber. You can sign up for Bespoke Institutional now and receive a 14-day trial to read our newest Conference Call Recap.  To sign up, choose either the monthly or annual checkout link below:

Bespoke Institutional – Monthly Payment Plan

Bespoke Institutional – Annual Payment Plan

Bespoke’s Morning Lineup – 11/20/24 – The Mother of All Earnings Reports

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.

“We survived ourselves. We were our own worst enemy.” – Jensen Huang

Morning stock market summary

Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.  

There’s a modestly positive tone in futures this morning, but the decks have been cleared to the mother of all earnings reports after the close when Nvidia (NVDA) reports. The only economic report on the calendar was MBA Mortgage Applications which showed a weekly increase of 1.7%. Asian stocks were mixed overnight with modest moves in either direction, and it’s a similar story in Europe this morning. Expect to see much larger moves in tonight’s Asian session, though, as NVDA’s results will have reverberations across the tech sector.

Walmart (WMT) may have marked the unofficial end of earnings season yesterday, but the largest company in the world goes by its own rules and reports on its own schedule. As mentioned above, NVDA will report after the close today, and with the stock accounting for more than 7% of the entire S&P 500 (most than most sectors), a lot rides on how the company reports. The company has reported an astonishing seven straight earnings triple plays which is practically unheard of for any company, but the fact that the most valuable company in the world has so consistently exceeded expectations across the board is unbelievable.

The chart below shows the performance of Nvidia (NVDA) since the release of ChatGPT nearly two years ago, and the red dots indicate each of the seven earnings reports (all triple plays) during that time.  While the stock has had several positive reactions to those seven earnings reports (it rallied between 9% and 24% the day after four of those reports) not every one of those triple plays was a launching point for the stock. Following three of those reports, the stock was flat to down on the day after in reaction, including a 6.4% following its triple play in August. As “blowing the doors off” relative to expectations has become more common, investors have come to expect it, which only raises the bar. The best thing NVDA may have going for it heading into this afternoon’s report is that the stock has gone nowhere in the last five months.

For investors positioned for a broadening of the rally, a positive reaction by the market to NVDA earnings may be the last thing they want. The chart below shows the performance of NVDA versus the Russell 2000 ETF (IWM) during 2024. Since the end of May, there has been a tendency for the Russell 2000 to perform poorly when NVDA has surged as it sucks all the capital from the pool, and vice versa.

As the market awaits NVDA earnings, this morning’s major report has been Target (TGT) which reported a reverse triple play with weaker-than-expected EPS, revenues, and lower guidance. While analysts have consistently underestimated NVDA earnings, they have been overly optimistic regarding TGT results. As shown in the snapshot below, before this morning’s report, its last report was the only one in the previous ten where the company didn’t miss EPS forecasts, revenue forecasts, or lower guidance.  By missing all three this morning, the stock is indicated to gap down over 18%, which would be the second largest downside gap in reaction to earnings since at least 2001.

As shown in the graphic above, even with the relatively poor results recently, shares of TGT haven’t necessarily reacted negatively to the news. However, even in a bull market where the S&P 500 has surged, the stock has performed negatively, and there are only three reports in the last eight where the stock was higher going into one earnings report than it was heading into the prior report.

The Closer – Tariffs, Office Weakness, Construction – 11/19/24

Log-in here if you’re a member with access to the Closer.

Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we start with commentary on tariffs (page 1). Next, we check in on the performance of office loans and CMBS (page 2) in addition to reviewing today’s residential construction figures (page 3).  We finish with a rundown on Canadian inflation (page 4).

See today’s full post-market Closer and everything else Bespoke publishes by starting a 14-day trial to Bespoke Institutional today!

Health Care Weightloss

We discussed the hard fall in Health Care sector stocks in today’s Chart of the Day.  While the drop has resulted in extreme underperformance versus the S&P 500, it has also resulted in the sector’s weight in the S&P 500 falling dramatically. At the end of 2022, the sector’s weight rose almost to 16%.  At that time, it was the second-largest sector behind Tech, and relative to its history, it was one of the largest weights on record.  The past couple of years have seen a dramatic weight loss that is now teetering on moving to a single-digit weighting.  At 10.36%, the Health Care sector currently has its lowest weight since September 2000.  Additionally, the 1.67 percentage point loss in weight over the past three months is one of the biggest declines on record.

Back at the recent highs in late 2022, Health Care was the second largest sector in the S&P 500. Today, it is only the fourth largest sector which is the lowest ranking it has had in more than a decade (2012).  Of course, that smaller weight means that the Health Care sector won’t have the same pull on the broader market that has been typical over the past couple of decades.


Featured Tools

Bespoke Chart Scanner Bespoke Trend Analyzer Earnings Report Screener Seasonality Database Economic Monitors

Additional Features

Wealth Management Free Charting Bespoke Podcast Death by Amazon

Categories