What the market taketh away yesterday, it’s giveth-ing back today. In other words, equities are rallying after Wednesday’s selloff. Treasuries are also on the up-and-up in price, pushing yields down by a couple of basis points.
In the commodities arena, gold and silver are flattish. Crude oil is pulling back, but still trading solidly in the high-$70s. Natural gas has been the real weak spot in the energy complex, trading for around $2.40 per million British thermal units (BTUs) now. That’s down sharply from more than $9.50 last summer.
On the news front, the mass layoff parade continues, with Walt Disney Co. (DIS) announcing plans to cut 7,000 jobs as part of a $5.5 billion cost-saving plan. The entertainment giant recently brought back former CEO Robert Iger to right the ship after a series of strategic missteps.
“Big Pharma” is reportedly looking for deals again, according to the Wall Street Journal. Total M&A activity was just $88 billion in 2022, the lowest since 2017...but that could change this year. The sector benchmark ETF, the iShares U.S. Pharmaceuticals ETF (IHE), has been underperforming the S&P 500 year-to-date. But we’ll see if its “unchanged” YTD record improves as 2023 unfolds.
In the bond market, more interest rate traders are betting on a 6% federal funds rate, per Bloomberg. That would mark a higher “terminal rate” for this rising-rate cycle than many market participants expected several months ago. The Federal Reserve’s current target range is 4.5% to 4.75%.
And in sadder world news, earthquake deaths have topped 17,500 now in Turkey and Syria. Russia is also reportedly intensifying its attacks in Ukraine.