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Markets Snap Back into Bullish Territory

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Markets were up this Monday, in what feels like the first day in the past week of trading that didn’t feel hijacked by hedge-fund short-squeeze plots (although now investors are talking up the silver market in similar terms), and began to once again assess the value of a post-Covid world, or at least the next plateau from the full pandemic period.

The Nasdaq led the way, +2.55%, followed by the small-cap Russell 2000, which snapped a five-session losing streak. The S&P 500 posted its best single trading day since November, +1.6%, while the Dow grew 230 points, +0.77%.

Republican senators on Capitol Hill are about to meet with President Biden this afternoon to pitch their alternative pandemic relief package, worth a reported $618 billion. This is less than 1/3 of what Biden’s proposed $1.9 trillion package would be, and the markets basically paid this news item no heed today. If negotiations get too thorny on a final package, Democrats on the Hill have already expressed interest in passing their bigger bill by reconciliation, which would require a simply majority vote.

Manufacturing data released earlier today showed a mixed, if muted, picture for last month: Markit Manufacturing PMI came in-line with expectations to 59.2, while ISM Manufacturing slid off pace a tad to 58.7% from an expected 60.0%, down 200 basis points month over month. Construction Spending, to keep an eye on Goods-producing another minute, rose 1.0% in December — better than the 0.8% expected, but a tad lower than the upwardly revised 1.1% the previous month.

Cirrus Logic (CRUS - Free Report) shares fell 7% following the release of it Q4 earnings statement, even though the fabless semiconductor supplier beat estimates on both top and bottom lines: $2.13 per share topped not only the $1.81 per share estimate, but the $1.41 posted in the year-ago quarter. Revenues beat expectations by 5% to $485.50 million, well ahead of the $374.67 million from the Q4-19 period. However, the lower range of revenue guidance for Q1, $280 million, is well below the $308 million in the Zacks consensus. For more on CRUS’ earnings, click here.

Vertex Pharma (VRTX - Free Report) is selling off about 1.2% after publishing its Q4 report this afternoon, with its first earnings miss since Q3 2016: $2.5 per share versus $2.65 expected. Still, it’s a big step forward from the $1.70 reported a year ago. Sales in the quarter beat estimates — $1.63 billion versus $1.58 billion expected — up around 15% year over year. Vertex shares dropped dramatically last fall upon the company scrapping a mid-stage trial on negative side-effects of its drug candidate, and is back to trading flat year over year.

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