Daily Market Commentary

February 22, 2024

Bonds & Stocks
Stocks climbed around the globe as Nvidia Corp.’s solid outlook reinvigorated the artificial-intelligence mania that drove equities to a bull market. Nvidia’s outlook rekindles AI mania The world’s most-valuable chipmaker soared 12% Thursday, putting it on course to add almost $250 billion to its market capitalization. The Nasdaq 100 jumped 2%, while the S&P 500 reclaimed the 5,000 mark. The $15 billion VanEck Semiconductor ETF jumped 5%. Tech also powered gains in European shares, while Japan’s Nikkei 225 extended its stellar rally to a record high. Treasury 10-year yields were little changed at 4.32% — after earlier climbing as jobless claims hit a one-month low.

Initial applications for US unemployment benefits fell to the lowest in a month last week, underscoring continued strength in the labor market despite a growing number of high-profile job cuts at large companies. Initial claims decreased by 12,000 to 201,000 in the week ending Feb. 17, according to Labor Department data released on Thursday. The figure was lower than all economists’ estimates in a Bloomberg survey. Continuing claims, a proxy for the total number of people receiving unemployment benefits, dropped to 1.86 million in the week ending Feb. 10, also the lowest in a month.

China’s quantitative hedge funds are admitting to unprecedented failures by their stock-trading models during one of the wildest two-week stretches in the market’s history. One manager described it as the industry’s “biggest black swan event.” Another said its models “switched from doing it right to getting it wrong repeatedly.” Leading quants each managing more than 10 billion yuan ($1.4 billion) lagged the CSI 500 Index by an average 12 percentage points in the two weeks ended Feb. 8 for the strategy tracking the stock gauge, bringing the year-to-date excess return to a negative 11.3%, according to industry data cited in a Huatai Securities Co. report.

The information represented herein was obtained from various sources, which we believe to be reliable. Neither the information presented nor opinions expressed constitutes an offer to buy or sell any security. And it is not intended to guide the investor on which securities to buy, or when to buy or sell.