The Rundown - More Boeing Problems, Mortgage Rates Hit 7%, Estee Lauder Stock Pops

Episode Date: February 5, 2024

Stock market update for February 5, 2024. Mortgage rates jump back over 7% as stronger economic data rolls in Boeing 737 MAX Has a New Problem. The Stock Is Falling. - Barron's Estée Lauder stock soars toward best day in 13 years after earnings, job cuts - MarketWatch The Money and Drugs That Tie Elon Musk to Some Tesla Directors (WSJ) ‘It’s a hangover’: Taylor Swift makes history as music business creaks (FT) 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.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 Monday, February 5th. In today's episode, we do a quick recap of everything that went down last week. It was a lot. We also discussed Jerome Powell's appearance on 60 Minutes and why it's spooked investors and the impact that it's having on the housing market. And then we end the show with a fun fact about Taylor Swift. Because if you make content on the internet, you have to talk about Taylor Swift right now.

And trust me, you're going to want to hear this one. All right, let's get started. Let's first do a quick recap of last week because it was a record-breaking week again. The S&P and Dow both finished at record highs and the NASDAQ was also up. But last week was a bit of a roller coaster. You know, we had the big tech earnings, we had the Fed meeting and the jobs report. Big tech earnings were solid, especially meta, which jumped 20% on Friday, adding nearly $200 billion to their market cap.

The Fed meeting, on the other hand, was a mixed bag. Jerome Powell was happy to see progress and strength in the U.S. economy, but he also hinted at rate cuts in March being unlikely. More on that in a bit. But the cherry on top last week was the jobs report that came out Friday morning. The U.S. economy added 353,000 jobs in January, which was way more than expected. So with all that, stocks closed at record highs on Friday. Now, this week won't be as action-packed as last week, but we still got some big-time earnings coming up. We're expecting earnings from big hitters like Disney, McDonald's, Chipotle, Ford, and Eli Lilly. So it should be another fun week. Markets are off to a bit of a tough start today, though,

as all three indices are in the red at the time this recording around 1 p.m. Eastern. The slow start today might have something to do with Fed Chair Jerome Powell's appearance on 60 minutes on Sunday. In the 60 minutes interview, Fed Chair Jerome Powell reiterated that the Fed is unlikely to cut rates in March. I mean, he's had the same thing at the Fed meeting last Wednesday, but traders kind of brushed that aside. It looks like they got the message now. According to the CME Fed Watch tool, a chance of a rate cut in March is now less than 15%. Just one month ago, those odds were higher than 60%. So yeah, the markets seem to have gotten the message this time.

And one of the impacts of delaying rate cuts seems to be mortgage rates. Mortgage rates are now trending back up. According to Mortgage News Daily, the average rate on the 30-year fixed mortgage climbed to 7.04% on Monday. Mortgage rates have truly been on a roller coaster ride since last year. At one point, they were higher than 8% last year, and then they dip below 7% when there was hope that the Fed was going to start cutting rates. And now that it looks like the Fed is going to wait to cut rates,

mortgage rates are starting to climb back up. And that's going to have an impact on the housing market. The spring home buying season is right around the corner, and if home prices continue to climb and mortgage rates start climbing too, it's just going to make the housing market even more unaffordable. Let's shift gears and talk about Boeing, because there's more bad news coming out of Boeing, everybody. Boeing found a new problem with their 737s.

This time, it seems to be improperly drilled holes in the fuselage. Boeing said this is going to impact 5737s that have not been delivered yet, so it's not going to impact planes that are curses. currently flying, which I guess is good news. But I mean, come on, Boeing. I would hope that their quality control would be better than my weekend projects. Because, you know, I am properly drill holes all the time whenever I try to hang a shelf or something. But I'm not building planes. All right, let's talk about some stocks making moves today. Estee Lauder, one of the biggest beauty in cosmetic companies in the world is a big winner today. Their stock is up more than 13% at the

time of this recording around 1 p.m. Eastern after they reported better than expected earnings. Stock is actually on track to have one of its biggest one-day gains in over 13 years. years. Now, what's crazy is if you dive into the earnings, their revenues drop 7% and their profits drop 21%. But the reason the stock still jumped is because those numbers came in higher than what Wall Street was expecting. And sometimes that's really all that matters. Also, S.A. Lauder announced plans to boost profits by laying off about 5% of their workforce, which they say will impact about 3,000 jobs. Let's talk about a company not doing so hot today. Honestly, this company hasn't been doing so hot all year. Tesla. The stock is down 4% today at the time

this recording around 1 p.m. Eastern. And this time, the drop in the stock price doesn't seem to be too related to the business, but more Elon related. There was a report in the Wall Street Journal over the weekend that Elon took drugs with Tesla board members. Yeah, so I guess Elon likes to party, and it might be kind of concerning to some Tesla shareholders. I don't really even know how to react here. One thing is for sure, 2024, not been a great year for Tesla and not been a great year for Elon. Last week, a Delaware judge struck down his $50 billion compensation package, and Tesla's stock is down more than 27% for the year, which is really bad if you compare it to the overall S&P 500, which is up more than 4%. Let's wrap up the show with a fun fact. Today's fun fact

is about Taylor Swift, who is having a fantastic 2024. Look, I know that there's been a lot of Taylor Swift content lately, but this fact is pretty impressive. Taylor Swift's sales accounted for 2% of the entire U.S. music business last year. Taylor Swift does more sales than the entire genre of jazz and classical. We've all heard about the size. success of Taylor Swift's era's tour last year. It was the first tour to do over a billion dollars in revenue. And it seemed to have a meaningful impact on local economies and where she was performing. I'm not making that up. This was cited by a report from the Federal Reserve back in September. So Taylor Swift is big business. And she also announced that she's dropping a new album in April.

She announced this while she was accepting her award for the album of the year at the Grammys last night for the fourth time, which is also a record. Bullish sign for the economy, you know, maybe? All right, guys, that's all I got for you guys today. It's going to be another fun week. Thank you guys so much for listening and we'll see you guys back here tomorrow. 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.