Market Review: March 26, 2024

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Closing Recap

Tuesday, March 26, 2024





DJ Industrials




S&P 500








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On the heels of small back-do-back down days, US equity futures bounced back overnight and held modest gains into the open with both the S&P and Nasdaq in the green. Investor sentiment remains more bullish than not, with the Fear and Greed Index holding at 71, Greed, consistent with levels of a week ago and a month ago but a big change versus the year-ago reading of 37, Fear. IWM, SPY and QQQ saw fairly consistent early performance across the board with each gaining about 0.25-0.30%. S&P futures continued to test the $5,291 resistance pivot, but with no success holding the level. Sector-wise, Consumer Discretionary, Financials and Communications were S&P sector ETF early leaders, while Utilities and Energy lagged as the only two in the red. Mid-morning breadth favored advancers by about 1.3:1.


In data of interest today, @DataTrekMB notes that while international markets have lagged the S&P 500 recently, it frequently takes multiple years of underperformance for a catch-up move to occur. Further, the “rest of the world” stocks have only outperformed 13% of the time on a rolling one-year basis over the past decade. Separately, @KobeissiLetter highlights purchasing power in the US is down over 20% in the past four years, as commodity prices seem permanently elevated. Case in point, cocoa prices have jumped 130% in 2024 to an all-time high. On the Fed, @RBAdvisors notes the Fed seems out of step considering cutting rates as the economy picks up, using an acceleration in core capital goods orders as an example. Lastly, on a positive note, @RyanDetrick points out the S&P 500 historically is up 13% on average a year after a 5% gain in February, similar to the Feb move we saw this year.


Heading into the final hour of trading, breadth remained about 1.1:1 in favor of advancers, while indices maintained small gains. IWM was a slight outperformer versus SPY and QQQ, but all finished lower. Sector dispersion had widened a little with Materials (XLB) and Industrials (XLI) joining Energy (XLE) and Utilities (XLU%) in the red. Upside sector leadership remained with Financials (XLF), Consumer Discretionary (XLY) and Healthcare (XLV). Growth outperformed value at +0.29% versus +0.14% based on the Russell 1000 Growth and Value, respectively. The overall price action was fairly muted until the last hour of the day as investors await new data points to evaluate future Fed action. A late day sell-off, especially in some of the big leaders of 2024 (semis) did some damage technically into some key GDP/inflation data the next two days as the S&P posted its last 3-day losing streak since 3/13-3/15, holding 5,200.

Economic Data

  • Durables Goods Orders for February +1.4% (vs. consensus +1.1%) vs January -6.9% (prev -6.2%); Durables ex-transportation orders +0.5% (vs. est. +0.4%) vs Jan -0.3%; Durables ex-defense orders +2.2% vs Jan -7.9%; General Machinery orders +1.9%, electrical equipment -1.5%, defense aircraft/parts +9.8%.
  • S&P CaseShiller January 20-metro area home prices +6.6% (consensus +6.7%) from year ago vs revised +6.2% in December (previous +6.1%); Us January home prices in 20 metro areas +0.1% seasonally adj (consensus +0.2%) vs revised +0.3% in December (previous +0.2%).
  • Richmond Fed composite manufacturing index -11 in March vs -5 in February and manufacturing shipments index -14 in March vs -15 in February; services revenues index -7 in March vs -16 in Feb.


  • April gold futures rallied overnight, but faded into the open and even went negative around midday before recovering to settle flat at +$0.80/oz, or +0.04%, to $2,177.20. Gold now appears to be in a waiting mode as investors struggle to sort through Fed rate cut expectations and underlying economic data trends. Is better good or is better bad? Does the Fed cut based on current inflation data even if it means cutting into an improving economy? For now, we just wait for the next data point.
  • April WTI crude futures settled lower by $0.33/bbl, or -0.4%, to $81.62. Brent similarly fell $0.50/bbl, or -0.58%, to $86.25. There was a bit of chop to the session as prices bounced between gains and losses into early afternoon. OPEC+ cuts and geopolitical issues continue to support supply concerns but were not enough and crude futures have now seen three down days in the past four sessions.
  • Oil and gold grab all the headlines in commodity space, but lately attention focused on cocoa prices, which have skyrocketed to nearly $10,000, a fresh all-time high. @KobeissiLetter noted “in 2024 alone, Cocoa prices are up 130% and outperforming most assets. To put this in perspective, $NVDA, one of the hottest stocks in the world, is up ~30% LESS than Cocoa in 2024. First it was Orange Juice and Olive Oil, now its Cocoa prices exploding. Commodity prices are outperforming many hedge funds. What happened to "transitory" inflation?





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10-Year Note




Sector News Breakdown

Retail, Consumer Staples & Restaurants:

  • In Consumer Products: CLX was upgraded from Underperform to Hold at Jefferies with $145 tgt saying its exit from Argentina (2% of sales), Uruguay and Paraguay are a long-term positive. It frees up capacity to focus on markets with better visibility and has limited impact on numbers.
  • In Restaurants: DNUT and MCD announce expanded national partnership as DNUT to provide fresh doughnuts daily at MCD’s restaurants across the country. The phased market roll-out to begin in the second half of 2024 with nationwide availability expected by the end of 2026, companies say.
  • In Food: Spice maker MKC reported a top and bottom line beat for Q1 and reaffirms their FY 2024 outlook saying they are still confident of hitting the mid- to high-end constant currency sales growth target. Reuters noted confection makers such as HSY and MDLZ are employing promotions and pitching more non-chocolate Easter treats like cookies ‘n’ cream bunnies at a time when soaring cocoa prices threaten their profits.


  • Coal stocks: CEIX, BTU saw weakness after the Maersk shipping vessel crashed into Baltimore Bridge which collapsed; seen as potentially impacting Baltimore Marine Terminal, a coal exporting terminal. The Terminal is inland of this bridge according to reports.
  • Solar News: NOVA shares rose after saying it had struck a deal with HD to be “the sole provider of solar and battery storage services” in the company’s US stores; MAXN announced that it has initiated a patent infringement lawsuit in the Eastern District of Texas against CSIQ, alleging infringement of Maxeon patents relating to TOPCon (Tunnel Oxide Passivated Contact) solar cell technology.

Banks, Brokers, Asset Managers:

  • Financial Services: RDDT shares jump on the open in another volatile session just one week after 22M share IPO priced last week at $34, shares opened at $47, and moved above $74 this morning.
  • In Credit Cards: MA and Visa (V) announced a settlement for U.S. interchange fees; reached an agreement to reduce its U.S. credit card interchange rates for at least a five-year period as part of a legal settlement with merchants; the settlement also features a set of adjustments to Mastercard’s network rules, allows small businesses and all merchants to continue to benefit from accepting electronic payments while delivering consumers a simple and secure way to pay.
  • In Investment Managers: BXSL and GBDC both upgraded to Buy from Neutral at Bank America saying their more optimistic view is due to stronger core EPS and relatively stable credit given the improving investment outlook, which should support modest multiple expansion. Base rates are expected to stay elevated in the near term, which supports a more durable top line.
  • Mortgage Services: RDFN said buyers need to earn $114,000 to afford the typical U.S. home–35% more than the typical household makes. But that’s an improvement from October, when buyers needed to earn a record $121,000–51% more than the median household income.
  • In Real Estate: Adam Neumann and several partners submitted an offer to buy WeWork out of bankruptcy for more than $500 million, putting one of the tech world’s most controversial founders a step closer to regaining control of his long-troubled startup. Neumann and his real estate firm, Flow, had pulled together a financing package for the co-working firm, Bloomberg News reported.

Biotech & Pharma:

  • AMRX said the FDA approved its treatment for a type of ear canal infection called acute otitis externa; says the treatment is indicated for pediatric, adult, and elderly patients.
  • BEAM announced the clearance of its clinical trial authorization (CTA) application by the United Kingdom (UK) Medicines and Healthcare Products Regulatory Agency for BEAM-302, an in vivo base editor, as a potential treatment for patients with alpha-1 antitrypsin deficiency (AATD).
  • BLUE shares fell after saying it plans to restate its financial statements for 2022 and the first three quarters of last year due to accounting errors related to some contract manufacturers; reported weaker Q4 revenue.
  • EFTR shares fell after saying topline data from randomized phase 2B kickstart trial of Tomivosertib combined with pembrolizumab in expected in early Apr 2024 (vs late Q1); said cash, cash equivalents, and short-term investments totaling $18.4M as of December 31, 2023.
  • MESO: FDA says phase 3 trial data appear sufficient to support BLA submission for Remestemcel-L in Children with steroid-refractory acute graft versus host disease.
  • MRNA said its next-generation COVID-19 vaccine mRNA-1283 has met the primary endpoints of a Phase 3 trial, as it demonstrated a higher immune response against the Omicron BA.4/BA.5 virus strains of COVID-19. when compared with its mRNA-1273.222 vaccine.
  • PRAX reports positive results of PRAX-628 study evaluating Photo Paroxysmal Response (PPR) achieving 100% response in treated patients.
  • STOK shares surged following data from the STK-001 Dravet Syndrome (DS) program as STK-001 update showed the FDA will now allow 3 loading doses of 70mg STK-001 (reducing impact of partial hold) which is key according to TD Cowen given updated data showing highly encouraging 85% seizure reduction w/ 2-3 doses of 70mg.
  • VKTX said its obesity drug VK2735 showed up to 3.3% mean weight loss compared to placebo during an early-stage trial and plans to initiate a mid-stage trial later this year, based on the early-stage data; Oral VK2735 demonstrated encouraging safety and tolerability following 28 days of once-daily dosing. Among subjects receiving VK2735, all treatment emergent adverse events (TEAEs) reported to date have been mild or moderate.

Healthcare Services & MedTech movers:

  • In Services: AMZN is launching same-day delivery of prescription medications in New York City and the greater Los Angeles area. The company plans to expand the offering to more than a dozen cities by the end of the year.
  • In Diabetes/Insulin Sector: TNDM upgraded from Hold to Buy at Stifel and raise tgt to $37 from $24 saying its second round of Mobi-specific diligence — and first since full-launch — paints a bullish picture as n=48 survey suggests Mobi adoption is potentially occurring more-rapidly, to a greater magnitude-than-expected.

Industrials & Materials

  • In Shipping: Maersk (AMKBY) shares fell its shipping vessel struck the Francis Scott Key Bridge in Baltimore − a major span to East Coast shipping – which collapsed early Tuesday. A container ship named the Dali was sailing down the Patapsco River when it struck a pylon of the bridge, crumpling almost the entire structure into the water.
  • In Industrials: MMM announced that out of a total of more than 293,000 claims, more than 249,000 claimants have registered to participate in the Combat Arms Earplug settlement agreement. Under the terms of the agreement, 3M will pay a total amount of up to $6.0B, between 2023 to 2029, to resolve the litigation.
  • In Transports: UPS issued 2026 targets ahead of its investor and analyst day later this morning; will discuss its 2026 financial targets as follows: Consolidated revenue ranging from approximately $108 billion to approximately $114 billion. Consolidated adjusted* operating margin above 13%. Shares of rails (CSX) and truckers under pressure early as bridge collapse in Baltimore shipping are likely impacts with less goods getting into ports.
  • In E&C Sector: UBS remained Buy rated on ACM ($105 tgt) FLR ($46 tgt) and Jacobs (J) ($163 tgt) after recent visits in Texas saying long cycle mega trends align well with AECOM, Fluor and Jacobs’ businesses, driving growth & margin expansion and each company has their own specific narrative, and also the common theme is that there are long cycle mega trends that align well with the long cycle nature of these companies’ businesses.
  • In Aerospace & Defense: ERJ downgraded from Buy to Neutral at UBS but raise tgt to $28.50 from $21, cutting its rating after recent rally as believes markets are pricing in positive optionalities, given that the current stock price implies c$700M EBITDA, the top range guidance, leaving virtually no meaningful upside potential.

Internet, Media & Telecom

  • In social media & Internet: BABA announced its logistics subsidiary Cainiao has withdrawn its IPO and listing application on the HK Stock Exchange; offers to acquire shares for $0.62/share or $3.75B. PINS shares rose after Piper reiterate Overweight and $48 tgt saying new Ad units suggest GOOGL partnership May be testing in U.S.
  • In Media: SPOT was added to the US 1 list at Bank America, while removed NFLX; Trump Media & Technology Group’s (DJT) shares jumped ahead of debut after merger with blank check firm DWAC; warrants of TMTG to begin trading with ticker "DJTWW" TMTG owns social media platform Truth Social and is backed by former U.S. president Donald Trump. Trump to own between 58.1% and 69.4% of TMTG, valued at about $3.3B.

Hardware & Software movers:

  • In Software: MSFT tgt was raised to $500 from $475 at Wedbush reflecting incrementally bullish recent AI customer checks with "transformative" Copilot monetization on the doorstep for MSFT and now starting to manifest across many customers and verticals. Wedbush said they view this as Microsoft’s "iPhone Moment" with AI and that recent work in the field it believes the next 3 years over 70% (vs. its original 60% estimate) of its MSFT installed base will ultimately be on this AI driven functionality for the enterprise/ commercial.
  • In HDD Sector: STX was upgraded from Equal Weight to Overweight at Morgan Stanley and raised tgt to $115 from $73 saying a cyclical recovery, tech leadership (HAMR), and the potential for Gen AI-related demand means STX is entering a period of structurally stronger gross margins, with MSCO’s new bottom-up analysis showing earnings power 25-30% greater than previously estimated.
  • In IT Services: GDS shares tumbled after Q4 results and guidance, announces $587M equity raise for international business and announced the appointment of Ms. Jamie Khoo, currently the COO of GDS, as the CEO of DigitalLand Holdings, the holding company for GDS’s international data center assets and operations.
  • In AI space: ALAB fell late to post its first down day since its IPO, touching highs above $95 per share after IPO last week – 19.8M shares had priced at $36.00 per share and opened at $52.56 last Wednesday (3/20).


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.

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