Markets mixed as traders digest jobless claims data

Dow slid back 9, advancers over decliners 5-4 & NAZ was off 7.  The MLP index fell 3 to the 294s & the REIT index stayed near 401.  Junk bond funds inched higher & Treasuries had modest selling which raised yields (more below).  Oil was even just above 70 & gold added 16 to 2651.

Dow Jones Industrials

As Pres-elect Trump prepares for his 2nd inauguration in Jan, a majority of investors are optimistic on his impact on the US economy, according to the latest CNBC Delivering Alpha Stock Survey.  In all, 71% participants in the survey think Trump “will be great for the economy and markets,” while 29% disagreed with that sentiment.  Respondents were also optimistic on his policies & the development of artificial intelligence, with 57% saying they trust how Trump & his appointees will handle this technology.  Tariffs emerged as a key theme for the incoming administration.  Participants in CNBC’s Delivering Alpha Stock Survey were split 50-50 on whether the duties will help or hinder the US economy, American workers & consumers.  During his campaign, Trump called for tariffs exceeding 60% on China goods.  Last month, he also vowed to impose an additional 10% duty on Chinese goods, as well as 25% tariffs on Canada & Mexico.  Trump has already been active in selecting people to serve in key posts throughout the gov.  He has also closely aligned himself with Elon Musk, CEO of Tesla (TSLA) & SpaceX.  When asked whether Musk is a “good influence,” 36% of respondents said, “for sure.”  An equal number said they were “not so sure,” while 28% said, “no way.”  CNBC's Delivering Alpha Stock Survey, which is issued quarterly, last week polled about 40 chief investment officers, equity strategists, portfolio managers & other money managers.  Small-cap stocks emerged as the preferred asset class going into 2025, with nearly 30% of participants choosing the category.  The S&P 500, which has risen more than 26% YTD & the NAZ has surged 33% in the period.   The S&P 500 tech sector closed at a record on Tues. 

Most investors think that President-elect Trump will boost the markets, a CNBC survey found

Starbucks (SBUX) workers have expanded their strike to more cities & closed 59 stores across the US, according to the union, which represents more than 10K baristas.  The strike began Fri in Los Angeles, Chicago & Seattle, but has since spread to stores nationwide, including in Boston, Dallas, Portland, New York City, Denver, Pittsburgh, Philadelphia & St Louis.  "We respect our partners’ right to engage in lawful strike activity, and we appreciate the thousands of partners across the country who are continuing to support each other and deliver the Starbucks experience for our customers," the company said.  Workers are protesting a lack of progress in contract negotiations with the company.   Starbucks Workers United said the company has failed to honor a commitment made 10 months ago to reach a labor agreement this year.  Talks between SBUX & the union have stalled with unresolved issues over wages, staffing & schedules.  "Workers United proposals call for an immediate increase in the minimum wage of hourly partners by 64%, and by 77% over the life of a three-year contract. This is not sustainable," the company said.  SBUX said the disruptions from the strike do not have a significant impact on operations because only a handful of stores across the country are affected.  The union warned that the strike could reach "hundreds of stores" by Christmas Eve.  SBUX operates more than 11K stores & employs about 200K workers in the US.  The company & the union have been bargaining since Apr.  SBUX said it has committed to an annual pay increase of 1.5% or more for unionized workers, even if it gave a lower increase to non-union workers in any given year.  The stock rose 1.91.

Starbucks workers expand strike, closing nearly 60 stores in several US cities

Treasury yields rose as investors digested new data on weekly jobless claims.  The yield on the 10-year Treasury jumped 5 basis points 4.633% & the 2-year Treasury traded 2 basis points higher at 4.359%.  1 basis point is equal to 0.01% & yields move inversely to prices.  Jobless claims totaled 219K last week, the Labor Dept reported.  The number came just 1000 below the previous period & less than the 225K forecast.  However, continuing claims, which run a week behind, rose to 1.9M, an increase of 46K, the highest level since Nov 2021.  The benchmark 10-year rate has climbed more than 40 basis points this month.   The bulk of the advance came after the Federal Reserve pared down rate-cut projections, indicating only 2 more interest rate cuts in 2025, down from the 4 potential cuts penciled in during Sep.

10-year Treasury yield rises above 4.6% as investors digest jobless claims data

Stocks wobbled as trading resumed after the Christmas holiday & investors digest the only significant economic data point of the week.  Markets looked to be struggling in a bid to extend the start of the Santa Claus rally, which kicked off with a bang on Tues.  All 3 major indexes rose around 1%.  The S&P 500 & NAZ moved to within striking distance of their records after clawing back gains from a Fed-fueled dive last week.