The Rundown - Luxury Stocks Get Richer, Core PCE Falls Below 3%

Episode Date: January 26, 2024

Stock market update for Friday January 26, 2024. Fed’s favorite inflation gauge rose 0.2% in December and was up 2.9% from a year ago (CNBC) LVMH Earnings Spark Luxury Stock Rally (WSJ) American Express Stock On Pace for Record Closing High Following Strong Guidance (Barron's) The content of the podcast is for general and informational purposes only. All views presented in this show reflect the opinions of the guest and the host. You should not take a mention of any asset, be it cryptocurrency or a publicly traded security as a recommendation to buy, sell or hold that cryptocurrency or security. Guests and hosts are not affiliated with or endorsed by Public Holdings or its subsidiaries. You should make your own financial and investment decisions or consult respective professionals. Full disclosures are in the channel description. Learn more at Public.com/disclosures. Past performance is not a guarantee of future results. There is a possibility of loss with any investment. Historical or hypothetical performance results, if mentioned, are presented for illustrative purposes only. Do not infer or assume that any securities, sectors or markets described in the videos were or will be profitable. Any statements of future expectations and other forward-looking statements are strictly based on the current views, opinion, or assumptions of the person presenting them, and should not be taken as an indicator of performance nor should be relied upon as an investment advice.

Welcome to the rundown, your daily market update in under five minutes. My name is Zadadmani, and today is Friday, January 26th. In today's show, we talk about inflation. There's new data out there saying that inflation is getting closer to the Fed's target. We also dive into the world of luxury with big earnings from LVMH and American Express. One of those stocks are making all-time highs. And finally, we highlight a semiconductor stock that isn't doing so hot. It might be hard to believe, but this semiconductor company just isn't delivering on the hype.

All right, let's get into it. Before we get into the stories, let's do a quick recap of how the stocks are doing. Stocks on Thursday continue to climb, thanks to GDP data showing strong economic growth. Go check out yesterday's episode of the rundown if you want more details on the GDP report. Yesterday, the Dow, NASDAQ, and S&P all finished higher, making it six straight days for the S&P 500. I'm not going to lie, when I saw that Tesla dropped 10% yesterday, which is a big part of the S&P 500, I was a bit worried that Tesla would drag the entire index down into the red with it. But no, we were able to get another green day.

And stocks are continuing the hot streak today as all three major indices are in the green at the time of this recording, around noon Eastern. And unless the market completely tanks after I get done recording this episode, we should be on track for another positive week for stocks. All right, let's run through some headlines. We got some more positive economic data

come out this morning. Yesterday, it was the strong GDP numbers. Today, it's inflation. The core PCE price index for December came out this morning. As a reminder, the PCE price index is the Fed's favorite inflation gauge. It measures inflation differently than the CPI index that you might be familiar with.

And the numbers were pretty positive. The core PCE for December was up 0.2% month over month and up 2.9% on a yearly basis. You know how we keep hearing that the Fed wants inflation to get back to its 2% target? Well, starting to get pretty close. And investors are loving this news because this opens the door for a Fed rate cut. Speaking of the Fed, we're going to be hearing from Jerome Powell next week at the FOMC meeting, which is on January 31st. So set your calendars right now. You already know I'll be all over to that meeting and talk about it here on the rundown. All right, let's talk about a couple of stocks that are making moves today, especially in the luxury sector.

LVMH, the parent company of luxury brands like Louis Vuitton, Jivanchi, and other expensive brands that I'm probably too poor to pronounce, reported better than expected earnings today. Their stock is up more than 12% at the time this recording around noon eastern. LVMH reported 2023 revenues of 86 billion euros. Remember, LVMH is a French company. That number was higher than expected and up 13% from the previous year. And LVMH also increased their annual dividends as well.

Another company that reported earnings today was American Express, and their stock jumped 7% today after forecasting a strong year for their business. Funny enough, American Express actually missed on their Q4 earnings, but investors are more hyped about the strong upcoming year. American Express's stock is nearing all-time highs. Now, similar to LVMH customers, American Express cardholders tend to be wealthier. So this earnings, along with LVMH's earnings, tell me that the luxury sector is doing pretty well and rich people are still buying stuff and will continue to buy stuff. Yeah, that's my,

that's my one-word analysis of these two earnings. Let's talk about a company that's not doing so well. Intel, Intel reported earnings today, and while those Q4 numbers were pretty decent, they expect their Q1 numbers to be lower than expected. Intel seems to be the only semiconductor stock that's not having a good year. Other semi-stocks like TSM, Nvidia, and AMD are booming this year. Intel, not so much, and their stock is down more than 10% at the time of this recording around noon Eastern. Intel is forecasting the revenues in Q1 to be between 12 and 13 billion. Wall Street was expecting the revenues to be closer to 14 billion. Now, similar to the other semiconductor stocks that I mentioned earlier, Intel was getting some of the AI hype, but unlike its rivals,

Intel has failed to deliver on the hype, at least so far. But I do think it's a company to keep an eye on. All right, let's wrap up this show with a fun fact. Today's fun fact is pretty quick. More than one fifth of the S&P 500 companies have reported earnings, and so far, 74% of them have surpassed Wall Street expectations. I guess it's no wonder that stocks are making all-time highs. All right, guys, that's all the guy for you guys this week. It's been another fantastic week. Next week is going to be huge.

We got the Fed meeting coming up. We got earnings from big tech companies like Apple, Microsoft, Meta, Amazon. So make sure you're tuning into the rundown next week. All right, have a good weekend, and I'll see you guys next week. This is Public Live, your real-time resource for news events and trends in the markets. All views presented in this show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Public live hosts are not financial advisors and are not affiliated with public holdings or its subsidiaries.

You should make your own financial and investment decisions or consult. Respective professionals. Learn more at public.com slash disclosures. In paid partnership with Zaid Admani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.