U.S. markets are in store for a sluggish start to the year after a banner close to 2019 and more in Tuesday’s Closing Bell on Money and Markets.
A traditional market bear believes the S&P 500 will dip down in early 2020 only to pick back up at the end of the year.
UBS head of U.S. equity strategy Francois Trahan upped his target for the S&P 500 to 3,250 from 3,000, but added there will be a decline in the first six months of the year followed by a recovery, according to CNBC.
“We expect a V-shaped year for the S&P 500,” Tranhan said in a note on Tuesday. “We see the Index struggling in H1′20, as forward earnings come under pressure, and rebounding vigorously in H2′20, as equities start to discount an upcoming recovery in the economy.”
The S&P 500 hovered around 3,240 through Tuesday afternoon trading.
The U.S. trade deficit fell to $43.02 billion in November 2019. The deficit is the lowest it’s been in three years, according to CNBC.
In the U.S., exports increased by $1.14 billion while imports fell $2.5 billion in the month.
Money and Markets: Closing Bell
S&P 500: 3,237 (-9 points, -0.2%)
DOW: 28,583 (-119 points, -0.4%)
NASDAQ: 9,068 (-2 points, -0.03%)
GOLD: $1,572.80 (+6.60, +0.4%)
BITCOIN: $8,164.82 (+8%)
U.S. 10-YEAR YIELD: 1.82%
*As of 4:13 p.m. EST
A Big Win
If you checked out our Wall Street Wake-Up this morning, you will have read about FireEye Inc. (Nasdaq: FEYE), a cybersecurity company.
Thanks to being upgraded to “buy” by SunTrust Banks, shares of FireEye jumped nearly 3% through afternoon trading Tuesday.
Tesla Inc. (Nasdaq: TSLA) was also on our morning watchlist. The automaker’s shares rose more than 4% on news of additional production at its Shanghai facility and a dancing, if you can call it dancing, CEO Elon Musk.
M&A News
Private investor Insight Partners has agreed to acquire cybersecurity firm Armis for cash at a valuation of $1.1 billion. CapitalG contributed $100 million to the acquisition — billed as the largest acquisition of a private Israeli cybersecurity company ever.
ADT Inc. (NYSE: ADT) has acquired its largest independent dealer. The Boca Raton-based security firm finalized the purchase of Indianapolis-based Defenders for $381 million in total consideration. Shares of ADT were down 0.6% in Tuesday afternoon trading.
Golden Nuggets
Precious metals continued to move higher through afternoon trading Monday.
Gold’s momentum slowed, but it still came close to $1,573 an ounce while silver moved up past $18.35 — a three-month high. Platinum was up to $966 and palladium moved up to $2,026 an ounce as investors continue to be uncertain over how tensions between the U.S. and Iran will play out.
Cannabis Corner
Constellation Brands Inc. (NYSE: STZ) is slated to present its Q3 earnings Wednesday morning, but one thing might hold it back.
During the quarter, Constellation spent heavily and invested $4 billion in Canopy Growth Corp. (NYSE: CGC), but the world’s biggest cannabis company by market cap, along with most of the cannabis industry, underperformed big time in 2019.
The expectation is for Constellation to be lower in its earnings per share and revenue compared to the third quarter a year ago. Constellation Brands shares were down 3.5% while Canopy Growth was down 1% through Tuesday afternoon trading.
Stock Market Update
U.S. markets were mostly down Tuesday.
The S&P 500 closed down 0.2%.
The Dow Jones Industrial Average fell 119 points, or 0.4%, to 28,583, and the Nasdaq composite fell 0.03%.
In other economic news, the Institute for Supply Management’s non-manufacturing index jumped to 55, beating economists’ estimates of 54.3. The rise is attributed to ease in the U.S.-China trade war.
Long-term mortgage rates fell to their lowest level since October this week. The average rate for a 30-year fixed mortgage dropped to 3.69%, signaling even more competition for buyers to get into open houses.
Today’s Big Winners:
(as of 3: 15 p.m. EST)
Apache Corp. (NYSE: APA) +25%
Micron Technology Inc. (Nasdaq: MU) +8.9%
Western Digital Corp. (Nasdaq: WDC) +6.8%
Boeing Co. (NYSE: BA) +1.5%
Trip.com Group Ltd. (Nasdaq: TCOM) +4.6%
Today’s Big Losers:
(as of 3:15 p.m. EST)
Alexandria Real Estate Equities Inc. (NYSE: ARE) -3.4%
Halliburton Co. (NYSE: HAL) -2.8%
Constellation Brands Inc. (NYSE: STZ) -3.2%
Intuitive Surgical Inc. (Nasdaq: ISRG) -2.1%
Merck & Co. Inc. (NYSE: MRK) -2.3%
Check back for the most important news and numbers each day after the Closing Bell, only on Money and Markets.
Don’t forget about “Marijuana Markets: a POTcast,” featuring the biggest cannabis news and investment notes from Banyan Hill’s Anthony Planas, here on Money and Markets each Saturday morning.