Daily Brief - GDP joyride

TLDR: The curtain rises on the financial stage with the Bureau of Economic Analysis spotlighting a 3.3% surge in Q4 GDP, outperforming forecasts and bringing 2023’s growth to 2.5%

This economic crescendo marks an impressive average annual growth of 3.4% during the Biden administration - a figure that is likely to gain prominence as the election approaches.

In reaction to these economic trends, the currency markets displayed a coordinated movement. The US Dollar Index (DXY) experienced a notable increase from 103.183 to 103.427, demonstrating its dominance over other major currencies.

Concurrently, the Euro and the Pound Sterling experienced a decline in value, with the Euro decreasing from 1.08983 to 1.08334, and the Pound falling to 1.27011, indicating their struggle to match the dollar's robust performance.

Gold, typically viewed as a secure investment, experienced a decline in value too, dropping to its lowest point in a week. Toggle suggests that this downward trend may persist, especially as policies become more relaxed and the likelihood of a recession diminishes.

The market is currently predicting a high probability that the Fed will maintain the current interest rates next week, while also keeping an eye on the possibility of rate reductions in March.

Market Movers: If Gold prices drop further?

Here are the historically best and worst performing stocks on a median basis post gold futures crossing below $2000:

The top 3 performing stocks:

1. Nvidia (Ticker: NVDA) with a 6-month return of 59.84%.
2. Eli Lilly (Ticker: LLY) with a 6-month return of 42.03%.
3. Vornado Realty Trust (Ticker: VNO) with a 6-month return of 41.99%.

The bottom 3 performing stocks:

1. SolarEdge Technologies (Ticker: SEDG) with a 6-month return of -59.45%.
2. Advance Auto Parts (Ticker: AAP) with a 6-month return of -52.72%.
3. Dollar General (Ticker: DG) with a 6-month return of -47.92%.

Earnings Update: Ryanair Holdings reports on Monday

In their last earnings report, Ryanair reported a higher-than-expected earnings per share and revenue, and the stock reacted by rising ~30% over the next month.

Looking forward, analysts predict a continued positive trend in Ryanair's performance. For the fiscal year 2024, the average estimate for Ryanair's earnings per share is $6.82, with expectations of growth in the coming year from $9.08 to $11.11 per share.

Discover how other companies could react post earnings with the help of TOGGLE's WhatIF Earnings tool.

Asset Spotlight: Further downside in oil prices?

Toggle examined 12 comparable instances in the past where Light Sweet Crude Oil prices experienced a rise. Historically, these situations are often succeeded by a median decrease in the commodity's price over the next two weeks.

Analysts forecast that oil production growth will slightly surpass the rise in demand as time progresses. This imbalance is projected to result in a steady accumulation of oil inventories, potentially leading to a downward influence on oil prices.