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🔎 Overlooked Is An Understatement
Plus, the costliest bankruptcy fees since Lehman...
Happy Wednesday 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 were mixed today, with the S&P 500 managing a narrow gain to snap its four-day losing streak ahead of NVIDIA’s earnings this afternoon.
📈 | One Notable Gainer: It was the tale of two Big Three automakers today. General Motors’ (GM) stock added nearly 4% after it hiked its quarterly dividend to 25%. But…
📉 | One Notable Decliner: Shares of Jeep-maker Stellantis (STLA) shed more than 5% after its net profit slumped 70% annually.
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S&P 500 Heatmap. Credit: Finviz
All Stock Heatmap. Credit: Finviz
Global ADR snapshot. Credit: Finviz
MARKET MOVERS
Anheuser Busch, AppLovin, Super Micro
BUD (+7.3%) AB InBev Stock Soars as Budweiser Maker Comfortably Tops Estimates (Investopedia)
APP (-12.2%) AppLovin Stock Takes It In The Shorts, Plunges On Two Negative Reports (IBD)
SMCI (+12.2%) Super Micro files financials just ahead of Nasdaq deadline and says it's 'regained compliance,' stock pops 22% (CNBC)
LCID (-13.6%) Lucid CEO steps down, company expects to more than double vehicle production this year (Reuters)
AAP (-17.8%) Advance Auto Parts’ stock skids as retailer predicts weak sales next quarter (MarketWatch)
OVERHEARD ON THE STREET
CNBC: The Fed’s favorite recession indicator, the inverted yield curve, is raising red flags again as the 10-year Treasury yield dropped below the 3-month note.
Reuters: US new home sales fell 10.5% in January and new housing inventory reached its highest level since 2007, showing a further slowdown in the market.
WSJ: Eli Lilly plans to invest $27B in four new US manufacturing plants, potentially creating 3,000 high-skilled jobs and employing 10,000 construction workers.
CNN: Jeff Bezos announced a "significant shift" to The Washington Post's opinion page, leading editorial page editor David Shipley to leave.
The Verge: Amazon unveiled a revamped Alexa with generative AI features for $19.99 per month, free for Prime members.
TOMORROW’S TRADE IDEA, TODAY
The Trump Trade You’ve Never Heard Of
Unregulated Upside
President Donald Trump has not been shy about cutting government red tape, and Bank of America (BAC) analyst Eli Abboud thinks that’s great news for financial stock BGC Group (BGC).
Abboud initiated coverage at a Buy rating and a $16 price target, implying more than 60% upside from current prices. The analyst believes investors are overlooking the stock, and that its FMX Futures Exchange is well-positioned to benefit from Trump’s deregulation.
Exception to the Rule
Unlike more run-of-the-mill Trump trades, BGC’s stock actually dropped in the wake of the election. But Abboud believes that, once deregulation truly takes hold, FMX Futures’ ramp will be extended.
The analyst added that futures trading is a $2 billion opportunity just waiting for someone to come along and disrupt the industry. BGC might just be that someone.
Overlooked & Unsung
The stock is also well-exposed to energy and should get a boost from heightened demand for electricity, according to Abboud. And he feels Trump’s policies should increase trading volumes as a whole, lending another potential tailwind to BGC.
Abboud is the only analyst currently covering the stock, according to MarketWatch, so to say it is being overlooked would be an understatement. But Trump trades with low entry points are few and far between — and Abboud believes BGC might not fly under the radar for much longer.
Are you bullish or bearish on BGC Group (BGC) over the next 12 months? |
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ON OUR RADAR
Reuters: NVIDIA’s results after the bell today could be a turning point for the "Mag 7" tech giants that have driven the market's rally since 2022.
WSJ: The US and Ukraine have reached a minerals deal, though it lacks clear security guarantees for Kyiv.
Forbes: Donald Trump Jr. earned nearly a quarter of Trump Media’s annual revenue, despite attending just two board meetings.
AP: Workplace management platform Slack went down today, with users unable to connect or load the service.
Bloomberg: Failed crypto exchange FTX’s $950M bankruptcy fees were the costliest since Lehman, but most creditors will recover 118% of what they were owed.
TUESDAY’S POLL RESULTS
Are you bullish or bearish on Alibaba (BABA) over the next 12 months?
🟩🟩🟩🟩🟩🟩 🐂 Bullish
🟨⬜⬜⬜⬜⬜ 🐻 Bearish
And, in response, you said:
🐂 Bullish — “Back on top again!”
Reply