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Friday, January 10

Some of the largest macro moves in the market today: Oil (WTI) +3.3%. US 10Y Treasury Bond -0.7%. US 2Y Treasury Bond -0.2%. Noteworthy US mega-cap moves today: NVIDIA Corp (NVDA) -2.7%. Broadcom Inc (AVGO) -1.9%. Exxon Mobil Corp (XOM) +1.3%. 

The payroll release surprised to the top-side with 256K jobs added in December and the unemployment rate moving down to 4.1%. This has created speculation that the Fed may keep rates elevated for the next several meetings.

Additionally, commodity prices such as oil have seen notable increases recently—WTI crude rose by approximately three percent—and gold remains supported above $2,680 per ounce due partly to ongoing market volatility surrounding labor market indicators and central bank monetary strategies across major economies like Japan's Bank of Japan considering adjustments based on evolving inflation forecasts.

United States Oil Fund LP (USO) [+4.4%]
United States Oil Fund LP (USO) has seen a price increase of 4.4% since Wednesday, coinciding with rising oil prices. West Texas Intermediate (WTI) crude for February delivery rose to $73.52 per barrel, driven by a reported decline of 1.0 million barrels in U.S. oil inventories last week. Additionally, a Chinese port operator has restricted sanctioned tankers from Russia and Iran from unloading, tightening supply further. Anticipation of new U.S. Treasury sanctions against Russian oil is also contributing to upward momentum in oil prices. Furthermore, cold weather across Europe and North America has increased fuel demand, enhancing market sentiment. Social media discussions highlight ongoing supply concerns and stockpile changes, reflecting the broader dynamics influencing USO's recent price movement.

iShares MSCI Japan ETF (EWJ) [-1.8%]
The iShares MSCI Japan ETF (EWJ) has seen a decline of 1.8% since Wednesday. The Nikkei 225 index fell by approximately 1% today, influenced by mixed signals from global financial markets regarding interest rates and economic conditions. Japanese households reported a decrease in spending for the fourth consecutive month, with inflation-adjusted consumption falling year-over-year, surpassing prior estimates. Concurrently, foreign investors have shifted to net selling of Japanese stocks as part of profit-taking strategies while buying bonds after a three-week exit period. This trend affects the EWJ ETF. Notably, significant contributors to the ETF's performance included Toyota Motor Corporation and Honda Motor Company, both of which experienced marked declines. Additionally, the Bank of Japan is anticipating continued wage hikes due to structural labor shortages, while Apollo Global is expanding its operations in Japan, planning to double its Asia wealth staffing amid increased deal activity.

CEG | +12.8% | +11.1B
Constellation Energy Corp | Electric Utilities
Constellation Energy Corp has announced a significant agreement to acquire Calpine in a deal valued at approximately $26.6 billion, which includes the assumption of around $12.7 billion in Calpine's debt. This transaction aims to combine Constellation's status as the largest producer of nuclear power in the U.S. with Calpine's extensive natural gas and geothermal assets. The acquisition is expected to close within 12 months, pending regulatory approvals. Following the merger, Constellation anticipates an immediate adjusted operating earnings per share accretion exceeding 20% by 2026, along with annual free cash flow projections surpassing $2 billion. Concurrently, social media discussions have highlighted the acquisition's potential to position Constellation as America's leading clean energy provider, with a stock price noted at 243.84, reflecting an increase of 11 points.

DAL | +8.7% | +3.7B
Delta Air Lines Inc | Passenger Airlines
Delta Air Lines Inc reported strong fourth-quarter results, with adjusted earnings per share (EPS) of 1.85, surpassing the consensus estimate of 1.76 and reflecting a year-over-year increase from 1.28. The airline generated revenue of 15.56 billion, exceeding expectations of 14.20 billion, and showing a 5.7% rise compared to the previous year. Delta's net income for the quarter reached 843 million. For 2025, the company forecasts adjusted EPS above 7.35, indicating over 10% growth from normalized 2024 levels. Additionally, Delta anticipates first-quarter revenue growth of 7% to 9%, driven by strong demand for premium travel and corporate sales. Concurrently, United Airlines Holdings Inc experienced a notable increase, attributed to positive market sentiment following Delta's results, with JP Morgan maintaining an Overweight rating on United and raising its price target.

UAL | +8.1%| +3.0B
United Airlines Holdings Inc | Passenger Airlines
United Airlines Holdings Inc. experienced a significant rise in its stock price, moving higher alongside the broader Passenger Airlines sector. The stock increased notably following Delta Air Lines' recent earnings report, which was met with positive market sentiment. JP Morgan has maintained an Overweight rating on United Airlines, raising its price target from 108 to 133. Social media discussions highlighted United Airlines approaching the 110 price mark, coinciding with Delta's announcement of improved booking numbers and a slight increase in guidance. Additionally, analysts from UBS Group raised their price target to 140, while Melius Research upgraded the airline to a "strong-buy." Other firms, including Bank of America and Goldman Sachs, also issued favorable ratings, reflecting optimism in United Airlines' financial health and recent quarterly performance.

RPRX | +4.9% | +808.7M
Royalty Pharma PLC | Pharmaceuticals
Royalty Pharma PLC has announced a significant acquisition of its external manager, RP Management, for approximately $1.1 billion. This deal is expected to generate cash savings exceeding $1.6 billion over the next decade, with specific savings projected to be over $100 million in 2026 and more than $175 million in 2030. Additionally, the company has introduced a new $3 billion share repurchase program, planning to repurchase $2 billion of shares in 2025, contingent on market conditions. Royalty Pharma anticipates achieving Portfolio Receipts of approximately $2.8 billion for the full year 2024. Meanwhile, social media discussions have raised concerns about upcoming portfolio prioritization and cost-cutting strategies, specifically mentioning Royalty Pharma alongside other companies.

CB | -4.0%| -4.1B
Chubb Ltd | Property & Casualty Insurance
Chubb Ltd has experienced a decline of approximately 4% in pre-market trading, coinciding with a broader downturn among insurance companies, including Allstate and Travelers. This drop is attributed to the impact of ongoing wildfires in California, which are projected to result in over $20 billion in insurance losses. Chubb is identified as one of the insurers most affected by these events, alongside Allstate and Travelers. Additionally, social media discussions have highlighted aggressive buying of January puts, reflecting market concerns regarding Chubb's exposure to wildfire-related risks. In a positive note, Keefe, Bruyette & Woods has raised Chubb's price target to 328 from 320 while maintaining an Outperform rating.

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