Markets had a limited recovery after DeepSeek-inspired tech rout

Dow went up 249, but decliners a little ahead of advancers & NAZ recovered 235.  The MLP index added 1+ to 217 & the REIT index fell 4 to the 404s.  Junk bond funds slid lower & Treasuries had more selling which raised yields.  Oil was steady in the 73s & gold bounded back 22 to 2760.

Dow Jones Industrials

Boeing (BA), a Dow stock, CEO Kelly Ortberg said the company is making progress on its recovery, including by focusing on core businesses & stabilizing production, as he faces investors antsy for answers after the plane maker posted its 6th consecutive annual loss.  Ortberg said that 737 Max deliveries will likely reach the “upper 30s” this month, up from 17 in Dec.  “We’re a little ahead of where I expected,” he said.  He added BA will likely turn cash flow positive in the 2nd ½ of the year, after burning thru more than $14B in 2024.  BA lost $3.8B in the last 3 months of 2024, taking about $3B in charges in its commercial aircraft unit & its defense & space business spanning aircraft from the Boeing 767 to the KC-46 tanker to the long-delayed pair of 747s that are set to serve as new Air Force One planes.  Revenue was down 31% from the same period last year to $15.2B.  Its results were impacted, as expected, by a nearly 2-month machinist strike that idled work on most of its aircraft & lengthened delivery delays to customers, which pay for the bulk of their planes when they're received.  It burned thru $3.5B in the 4th qtr, a difficult end to what was supposed to be a turnaround year.  The company released preliminary results last week showing a wider loss & lower revenue than analysts expected.  The company’s annual loss totaled $11.8B, its largest since 2020, when it was grappling with a grounding of its bestselling plane, the 737 Max, after 2 fatal crashes & the Covid-19 pandemic.  “While it was a challenging year, we are seeing encouraging signs of progress as we work together to turn around our company,” Ortberg said.  “We are also preparing for the path ahead by continuing to make investments in our core businesses while streamlining our portfolio in areas that are not core to our future,” Ortberg added.  The stock rose 9.35.

Boeing CEO upbeat on recovery after company’s biggest annual loss since 2020

US consumer confidence weakened for a 2nd straight month in Jan amid renewed concerns about the labor market & inflation.  The Conference Board said its consumer confidence index fell to 104.1 this month from an upwardly revised 109.5 in Dec.  The forecast had forecast the index rising to 105.6 from the previously reported 104.7.  "Views of current labor market conditions fell for the first time since September, while assessments of business conditions weakened for the second month in a row," said Dana Peterson, the chief economist at the Conference Board.  "Additionally, references to inflation and prices continue to dominate write-in responses."

US consumer confidence deteriorates further in January

The Senate Finance Committee advanced Bessent's nomination to the full Senate with a bipartisan vote of 16 to 11 on Jan 21, the day after Trump's inauguration.  During the presidential campaign, Bessent touted what he called the "3-3-3" plan that was modeled off the late Japanese Prime Minister Shinzo Abe's "three arrows" idea.  The role of treasury secretary carries a great deal of significance for conducting the pres's economic agenda.  Treasury secretaries often lead negotiations with Congress over tax & spending matters.  They also play a key role in dealing with foreign govs & financial institutions, as well as handling the operations of the Treasury Dept & sub-agencies like the Internal Revenue Service (IRS).  During Trump's first term as pres, Steven Mnuchin served as treasury secretary for the duration of the 4-year term after he was confirmed by the Senate on a 53-47 vote a few weeks after.  Mnuchin served as a key negotiator with Congress on the debt limit, tax & spending policies, as well as COVID relief packages that were enacted in 2020 after the pandemic began.

Scott Bessent confirmed by Senate to serve as Trump's treasury secretary

NAZ & S&P 500 rebounded, following a steep stock sell-off spurred by concerns of over-confidence in Big Tech's potential payoff from investments in AI. Investors also assessed a return to a tougher tone on tariffs from Pres Trump, ahead of the start of a Federal Reserve meeting where the impact of his policies is likely to be discussed.  That risk to US leadership in AI raised questions about whether chipmakers & other tech names call follow thru on high earnings expectations.  Stocks began to chip away at losses booked in yesterday's tech-led rout.  With that risk to inflation in mind, investors are keeping a watchful eye on the Fed's 2-day policy meeting that begins later today.  The central bank is expected to leave interest rates unchanged, given recent solid economic readings.