Happy Friday afternoon to everyone on The Street. Here's a snapshot of where markets ended the trading session, plus tomorrow's trade idea delivered to you today.

• 🟥 | US stocks fell on Friday after another hotter-than-anticipated inflation report. The PPI index for January jumped 0.3% and now Wall Street thinks the Fed may not cut rates as quickly as originally anticipated. All three major averages snapped their five-week winning streak, ending the week in the red.

• 📈 | One Notable Gainer: Coinbase’s stock popped 9% following the cryptocurrency exchange's announcement of its first profit in two years.

• 📉 | One Notable Decliner: Roku’s shares plummeted 24% after a miss on average revenue per user, shaky ad market, and Big Tech competition.

• 🔧 | Tomorrow's Trade: O-O-O-O'Reilly. Scroll down for more.

Plus, need context for the US options market? Today's partner makes it available in a simple and intuitive web-based API.

MARKET MOVERS

Nike, Yelp & DoorDash

AMAT (6%) Applied Materials’ stock climbs as company logs earnings beat, sees AI momentum (Market Watch)

VMC (5%) Vulcan Materials Shares Hit All-Time High After Above-Consensus 4Q, Outlook (Market Watch)

TTD (17%) Trade Desk shares soar on revenue beat and strong guidance (CNBC)

NKE (-2%) Nike to lay off 2% of employees, cutting more than 1,500 jobs during broad restructuring (CNBC)

YELP (-14%) Yelp posts strong year, but weak guidance sends its stock sliding (Market Watch)

DASH (-8%) DoorDash stock falls over 2024 order growth concerns (Yahoo! Finance)

TOGETHER WITH CBOE

OVERHEARD ON THE STREET

Reuters: Federal Reserve Bank of Atlanta President Raphael Bostic said on Thursday that while the U.S. central bank has made a lot of progress lowering inflation pressures, ongoing risks mean that he’s not yet ready to call for interest rate cuts.

BBG: Goldman Sachs boosted David Solomon’s compensation 24% to $31 million for a year when earnings slumped at the Wall Street giant.

The Conversation: Global consumption of raw materials is set to rise by a further 60% by 2060.

YF: Billionaire Starwood CEO Barry Sternlicht sees losses on office properties hitting $1 trillion.

NY1: Four in 10 companies say artificial intelligence is likely to replace some employees in 2024.

TOMORROW’S TRADE IDEA, TODAY

They’re Not Pretty, But They’re Consistent

Rollercoaster Ride

On Monday the S&P 500 broke records, closing at 5,000 for the first time in history. 

How did the market respond the next day?

There was a huge stock selloff, largely due to higher-than-anticipated CPI numbers, and the S&P fell 1.4%. 

Only 10% of the companies within the S&P had a positive trading day. 

Two of those companies, both in the automotive industry, were Autozone (AZO) and O’Reilly Automotive (ORLY).

Often an Afterthought

Automotive stocks can be overlooked because they are not the kind of shiny, cutting-edge companies that make headlines.

Nevertheless, since 2018, both stocks have been extremely consistent for investors, and it makes sense:

• During volatile market conditions or economic downturns, consumers often prioritize vehicle maintenance and repairs over discretionary spending.

• The automotive aftermarket industry is often considered defensive due to its non-cyclical nature and the essential nature of the products and services it provides.

• Both companies are prominent players in the automotive aftermarket industry, enjoying a strong market position and brand recognition.

Interestingly enough, despite being only two of 10 S&P stocks to trade above $1,000 per share, neither has had a stock split in over 20 years.

Can They Beat the S&P?

Zooming out, both have also had very consistent upward growth going back 25 years. Multi-month dips have been few and far between, and the overall upward trend has not changed. 

That’s why CNBC believes these stocks could outperform the S&P this year, something Autozone and O’Reilly have not managed in the past two years. But from 2019 through 2021 they did, beating the S&P by 60.13% and 17.12%, respectively. The stocks are following similar trends vs. the S&P now as they did then.

If history is any indicator, investors looking to outperform the broader market might find just the right stocks in these under-the-radar automotive companies.

TOGETHER WITH CBOE

ON OUR RADAR

Fortune: People with higher education are more likely to be able to work hybrid or remotely (between 59% for those with college degrees and 41% for those without).

Axios: YouTube TV now has more than 8 million paid subscribers, the company said Tuesday, making it one of the largest TV providers in the country.

Bloomberg: After separation, men's incomes on average drop 17% while they decline 9% for women.

CNN: Empty-nest Baby Boomers own 28% of large homes — and Milliennials with kids own just 14%, according to a Redfin analysis.

Advisory Board: The number of Americans expressing high satisfaction with their lives also declined. Currently, less than half (47%) of Americans say that they are very satisfied with their lives, just one percentage point above the record low in 2011 (46%).