Hawkish Fed, Retail Sales Weigh on Wall Street

The central bank hinted at more interest rate hikes in 2023

Digital Content Manager
Dec 16, 2022 at 1:32 PM
facebook X logo linkedin


Inflation data and the Federal Reserve's interest rate decision dictated much of this week's market movement. Investors were fiercely optimistic to start, though the U.S. budget deficit widened to $248.5 billion in November. Both the Dow Jones Industrial Average (DJI) and Nasdaq Composite (IXIC) saw back-to-back, triple-digit gains, while the S&P 500 Index (SPX) reclaimed the 4,000 level thanks to a cooler-than-expected consumer price index (CPI) reading for last month.

That optimism came crashing down, though, after the Fed announced a 50 basis-point rate hike, bringing its benchmark interest rate to its highest level in 15 years. Plus, Fed Chairman Jerome Powell hinted at more rate hikes in 2023 as the central bank's fight against inflation continues. That downward spiral continued after disappointing retail sales data sparked recession fears, which pushed the IXIC and SPX to their worst single-day percentage drop since Nov. 2. At the time of this writing, all three major benchmarks were on track to log a second-straight weekly loss.

Tech Stocks Making Moves

Several tech stocks made headlines this week. Coupa Software (COUP) entered into a definitive agreement to be acquired by Thoma Bravo for $8 billion, while Oracle (ORCL) brushed off a quarterly win. Meanwhile, struggling Advanced Micro Devices (AMD) has been getting blasted in the options pits, and fellow chip maker Western Digital (WDC) received a downgrade to "sell."

Over in the social media realm, Pinterest (PINS) surged after drawing analyst praise, and options bulls swarmed Snap (SNAP) despite a Jefferies bear note. In addition, a bear signal was threatening to push ridesharing name Lyft (LYFT) even lower, while Maxar Technologies (MAXR) more than doubled thanks to a $6.4 billion acquisition deal

Major Biotech Sector Updates

The biotech sector was in focus as well. Amgen (AMGN) will reportedly buy Horizon Therapeutics (HZNP) for $26.4 billion, with the deal expected to close in early 2023. Moderna (MRNA) was under the spotlight, too, after a mid-stage trial of its experimental melanoma vaccine combined with Merck's (MRK) immunotherapy showed encouraging results. Avidity Biosciences (RNA) also released positive trial data demonstrating the first-ever successful targeted delivery of RNA into muscle, while Novavax (NVAX) announced concurrent stock and debt offerings, and BioNTech (BNTX) revealed plans for a clinical trial hub in Taiwan for its MRNA-based cancer immunotherapies.

Plenty of Data to Unpack Before Christmas

The week before Christmas will pack a punch in terms of economic indicators. Most notably, the latest personal consumption expenditures (PCE) price index, durable goods orders, consumer spending, and housing data are on tap. And while the earnings docket is quiet, Cintas (CTAS), General Mills (GIS), Nike (NIKE), Rite Aid (RAD) will still report. Before then, look back at several "known unknown" events that triggered selling this  week, and see why the second half of December could bring tailwinds to Wall Street.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI