Market Review: March 05, 2024

Closing Recap

Tuesday, March 05, 2024





DJ Industrials




S&P 500








Russell 2000













U.S. stocks end lower for a second day amid a pullback in Technology (XLK -2.45%) as the Nasdaq dips 2% after hitting all-time highs this week, and Consumer Discretionary (XLY -1.25%) after a handful of news stories weighed on large caps, Markets now await day one of Fed Chairman Powell testimony in Washington DC on monetary policy tomorrow morning at 10:00 AM. While tech bled lower, leading the Nasdaq down -28%, Energy (XLE), Consumer Staples (XLP) and select financials (KRX, KRE) helped soften the market weakness. Retail got a boost after strong Target (TGT) earnings, while the software space awaits CRWD results tonight. For a change it was a “sell the rips” vs. “buy the dips” kind of day, something we haven’t seen too often thus far in 2024. The other momentum asset class that has been rallying in 2024 was Bitcoin, hitting fresh all-time highs above $69K this morning…but tumbled as much as 11% late day, falling to lows below $60K in massive profit taking.


Calendar of Events in a busy week: for Wednesday 3/6: Fed Chairman testimony to Congress on monetary policy/economy at 10:00 AM; February ADP Private Payrolls data at 8:15 AM ET and at 10:00 AM ET JOLTs Job data; The UK Chancellor unveils The 2024 Budget on Wednesday; Fed Beige Book at 2:00 PM ET; Imports/Exports/Trade balance data from China for Feb; earnings from ANF, CPB, FL, VSCO. Thursday 3/7: Fed Chairman testimony to Senate on monetary policy/economy at 10:00 AM; European Central Bank (ECB) meeting (no rate change expected buy presser will be watched for clues over the timing of the first-rate ease of the cycle; weekly jobless claims as well as Q4 Nonfarm Productivity/Labor costs; earnings from AEO, AVGO, BJ, BURL, CIEN, COST, DOCU, GPS, KR, MDB, MRVL, SWBI. Friday 3/8: The February Nonfarm Payrolls report/wages/unemployment; China PPI, CPI data at night.


In a story that didn’t get too much play but worth watching (especially after the AT&T outage two weeks ago that effected hundreds of thousands of customers for several hours), there was a massive global outage that impacted dozens of top platforms today, including the following: Facebook, Instagram, Google Play, Facebook Messenger, YouTube, Google, WhatsApp, Gmail, Google Maps, Teams, TikTok, and Snapchat. Interesting that the outages occurred on “Super Tuesday” as 15 states hold Republican contests on the biggest voting day of primary season.


Economic Data

  • S&P Global February final services PMI at 52.3 (vs flash 51.3) and U.S. S&P Global February final composite PMI at 52.5 (vs flash 51.4).
  • February ISM Non-Manufacturing (services) PMI reported at 52.6 vs. 53.0 consensus and 53.4 prior, while prices paid at 58.6 vs. 64.0 prior, employment 48.0 vs. 50.5 and new orders 56.1 vs. 55.0 prior.
  • January Factory Orders fell (-3.6%) vs. (-3.1%) consensus and (-0.3%) in December (revised from +0.2%).

Commodities, Currencies & Treasuries

  • The benchmark 10-year Treasury yield fell to a one-month low around 4.11% (down over 10-bps) before paring losses while the shorter-term 2-yr yield fell -5 basis points to 4.554%. The move came after data showed U.S. services industry growth slowed slightly and as investors prepared for U.S. jobs data Friday for further clues on Federal Reserve policy. Traders are evaluating when the U.S. central bank is likely to begin cutting interest rates as growth remains relatively strong and inflation gets closer to the Fed’s 2% annual target. Testimony by Fed Chair Jerome Powell to Congress on Wednesday and Thursday will be watched.  
  • In Commodity prices: Gold prices hit another intraday record high, rising $15.60 to settle at $2,141.90 an ounce, its 3rd straight day closing at fresh high. Oil prices slipped as WTI crude futures settled at $78.15 per barrel, down $0.59 or 0.75%. Brent Crude futures settled at $82.04/bbl, down 76 cents, 0.92%. Natural gas for April delivery rises 4c or 2.1% at $1.957/mmBtu after briefly touching the $2 mark for the first time in a month. Bitcoin hit a high of $69,202, topping its November 21, 2021 all-time intraday high of $68,990, before quickly pulling back and extending losses to fall as much as 11% below $60K late day.





WTI Crude















10-Year Note




Sector News Breakdown

Retail, Consumer Staples & Restaurants:

  • Hardline Retail: TGT Q4 adj EPS $2.98 vs. est. $2.40; Q4 sales rose 1.6% y/y to $31.47B vs. est. $31.35B; Q4 comp sales fell (-4.4%) vs. +0.7% y/y but in-line with expectations; foot traffic was down 1.7% from the year prior, an improvement from down 4.1% in Q3; guides Q1 EPS $1.70-$2.10 vs. est. $2.08 and FY $8.60-$9.60 vs. est. $9.15.
  • In Online Retail: SFIX mostly in-line Q2 as EBITDA $4.45M vs. est. $4.5M and Q2 revs $330.4M vs. est. $330.5M but lowered its FY rev outlook to $1.29B-$1.32B from prior $1.30B-$1.37B and FY adj EBITDA from continuing ops $10M-$20M vs. prior $30M. TDUP mixed Q4 results while guides for revenue growth this year, after slightly exceeding its own expectations in the 4Q in this metric, but active buyers/orders stood at 1.8M from Q3.
  • In Retail Wall Street Research: GCO was downgraded from Buy to Neutral at B Riley and cut tgt to $31 from $43 while lowers its NTM EBITDA estimate from $85M to $61M, which drives its lowered PT and stock rating. WSM was downgraded to Hold from Buy at Loop Capital, but up tgt to $220 from $200 as rating change is based on the stock’s current valuation as opposed to a more bearish view of the company’s fundamentals.
  • In Food space: Chocolate maker Lindt’s 2023 profit was lifted by price hikes as chocolate market slows; reported a 17.9% rise in net income to 671.4Mm Swiss francs ($758Mm) for the year to Dec. 31, broadly in line with the 670Mm francs forecast; had already reported in January a 10.3% rise in organic sales for the year; achieved an operating margin of 15.6% last year, up from 15% in 2022 HSY and Cadbury maker MDLZ shares active on news).
  • In Tobacco: PM was downgraded from Buy to Hold at Argus citing ongoing product risks for the company noting the company faces a range of legal and regulatory risks, including smoking bans, restrictions on package advertising, and FDA regulation of both smoke-free and combustible products.

Homebuilders, Building Products, Home Furnishing:

  • In Housing: Short seller SprucePoint Capital negative on ZG saying they sees 40% to 60% long-term downside risk to Zillow’s share price as believes Zillow is a mature business under increasing pressures with recent failed growth initiatives that illustrate management is incapable of innovating and delivering on goals.
  • In Building Products: FND was downgraded to Neutral from Buy at UBS on valuation after share price but says they remain enthusiastic about the L-T outlook as believe the retailer will eventually operate 500 stores (vs. 221 today), enabling it to gain significant share of the flooring & d�cor markets.

Autos, Leisure, Gaming & Lodging:

  • In Autos: TSLA’s European Gigafactory near Berlin halted production and was left without power after a suspected arson attack set an electricity pylon ablaze close to the site early on Tuesday. The blaze southeast of the German capital, did not spread to the Tesla site according to the reports. Chinese EV maker NIO net loss of 5.4 billion yuan in the fourth quarter brought its annual deficit to 20.7 billion yuan ($2.9 billion), as results missed ests. HOG shares jumped after Davidson said they remained Buy and $42 tgt saying their latest checks revealed positive U.S. retail sales growth in February.

Energy, Industrials and Materials

  • In Aerospace: AVAV shares jumped after Q4 beat as adj EBITDA $28.8Mm tops est. $23.88MM on revs $186.6Mm vs est. $170.62Mm, and guides FY revs $700-710Mm vs est. $700.83Mm, and EPS $2.69-2.83 vs est. $2.73; RKLB MNTS shares active after NASA selected 15 companies to provide flight and payload integration services to advance technologies and procedures for operating in space, including testing in high-altitude, reduced gravity, or other relevant environments for the $45m contract. Ethiopian Airlines has agreed to purchase eight BA 777-9 passenger jets, with potential for up to 12 additional aircraft orders, the companies said in a statement,
  • In Materials: ALB shares fell after the announcement of $1.75B depositary shares offering; after months of downward momentum, gold miners (AEM, GOLD, NEM) and precious metals in general seeing strength given the highs expectations of Fed rate cuts in coming meetings, while the dollar/yields slip.


  • Credit cards (COF, SYF, BFH) shares were active as Federal regulators are slashing credit card late payment fees. The Consumer Financial Protection Bureau (CFPB) finalized a rule on Tuesday that caps credit-card late fees at $8, a fraction of what most issuers typically charge (around $32). The rule is part of a broader campaign within the Biden administration taking aim at so-called junk fees. The bureau estimates banks brought in roughly $14 billion in credit card late fees a year.
  • In Crypto: MSTR takes advantage of its 111% YTD stock price advance behind gains in Bitcoin as announced a proposed private offering of $600M of convertible senior notes. Binance said some users had temporarily experienced issues when trying to withdraw their digital tokens from the cryptocurrency exchange, citing a technical error. The withdrawal issue came just minutes before bitcoin (BTC-USD) touched a new record.
  • In Payments: PAY shares jump after results/guide; Q4 EPS $0.07 in-line with consensus on better revs $164.8M vs. est. $157.4M; sees FY24 revenue $720M-$744M vs. est. $732.2M and sees FY24 adjusted EBITDA $65M-$75M vs. $58.1M in FY23; but guided Q1 revs $170M-$176M vs. est. $177.9M.
  • In Lending: SOFI shares slipped after saying it plans to offer $750 mln of convertible debt, that would mature in 2029, to "qualified institutional buyers" in a private offering.

Biotech & Pharma:

  • AKYA reported 4Q23 results that were at the high end of the preliminary guidance range Akoya provided in early January as top-line results were driven by strong growth in reagents and services revenue.
  • ALNY and RHHBY said their experimental drug (Zilebesiran) against high blood pressure was shown to work when used in combo w/standard of care; full results of the Phase 2 KARDIA-2 trial, testing the twice-a-year injection Zilebesiran, presented 4/6/24 at the American College of Cardiology Annual Scientific Session.
  • APGE said one of its lead drug candidates, antibody-based drug APG777 to treat moderate-to-severe atopic dermatitis (AD), was found to be safe and well tolerated in the study -APGE.
  • RGNX shares jump following interim safety and efficacy data from its early-stage trial testing its muscle disorder therapy in patients with Duchenne muscular dystrophy; said therapy has been well tolerated with no drug-related serious adverse events.
  • TNDM announces proposed private placement of convertible notes.

Healthcare Services & MedTech movers:

  • Dialysis companies rally: DVA and FMS shares jump after NVO results of a clinical trial for blockbuster drug Ozempic in people with diabetes and chronic kidney disease, as the trial achieved its main primary objective by showing a 24% reduction in the risk of kidney disease-related events in people with type 2 diabetes and chronic kidney disease – but came in below street ests (Citi had expected a relative risk reduction of 30% on objective).


  • It was a profit taking day, pulling back broadly with the Nasdaq 100 (QQQ) down over 2% late day after hitting all-time highs this past week.
  • AAPL shares were pressured after a Reuters report overnight that its iPhone sales in China fell 24% year-on-year in the first six weeks of 2024, according to research firm Counterpoint, as the U.S. company faced increased competition from domestic rivals such as Huawei.
  • AMD shares dropped after reports the company hit U.S. government roadblock in efforts to sell AI chip tailored for Chinese market, according to Bloomberg News. The block reflects Washington’s crackdown on export of advanced technologies to China.
  • CDNS said it will buy BETA CAE Systems International AG, which makes software for analyzing car and jet engine designs, for $1.24 billion in cash and stock.
  • CRWD is expected to report earnings tonight in the cyber security sector – will be closely watched after PANW disappointing results 2-weeks ago hurt the sector (OKTA recently better, ZS beat but shares fell).
  • DELL and CRWD expand partnership delivering comprehensive managed detection and response.
  • DIS got a boost late day following comments from CEO Iger at Morgan Stanley conference.
  • GTLB shares slump as FQ4 revenue growth of 33% Y/Y nicely surpassed ~28% consensus forecast citing improved buying behavior across all customer sizes, but provided a poor FY25E initial revenue outlook and stated that its guidance philosophy is "less conservative".
  • In Telecom & Cable: AT&T (T) was upgraded from Peer Perform to Outperform at Wolfe as the firm argues that it’s time to take the company shares seriously as a long. CABO was upgraded from Neutral to Buy at Moffett.


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.