December 22, 2023

Markets:

Stock futures shifted lower on Friday morning as Wall Street looks to extend its year-end rally.

The move in futures comes on the heels of a bounce-back day on Wall Street. The Dow rose 322 points, or about 0.9%, erasing most of its losses from Wednesday. The S&P 500 and Nasdaq Composite rose 1.0% and 1.3%, respectively.

The small-cap Russell 2000 led the way with a gain of 1.7% on Thursday, continuing a recent trend of the market rally broadening out as bond yields fall and traders bet on rate cuts from the Federal Reserve. The small-cap index is on pace for its sixth straight positive week.

The 10-year U.S. Treasury yield fell marginally Friday as investors readied for a shorter trading day ahead of the holidays. The yield on the benchmark 10-year Treasury note was seen opening less than a basis point lower at 3.8894% after inching up slightly on Thursday.

At 8:30 a.m. ET, November data for personal income, consumer spending and the personal consumption expenditures report are due out.

Core PCE, which excludes volatile food and energy prices and is the Fed’s preferred inflation gauge, is expected to come in at 3.5% over the past 12 months, according to economists surveyed by Dow Jones.

Portfolio:

We enter the last trading session of the week holding set-ups in RIOT, PTON, TSLL, IQ, and SOFI. Our thesis on the pain trade has worked out beautifully thus far and now we continue to build for what we see to start 2024 and leading into the election cycle, one of the greatest opportunities presented to us every four years. Next week, regardless of what PCI reports bring us today, will present massive opportunity for us to help position ourselves for the next few weeks. We might be able to even pinpoint a few quick trades based on history. Absolutely love this time of year and the opportunity it provides us. Always a great time.

With that said, we understand many like to take some time off over the next week. We want to wish you all a joyous and peaceful Christmas and New Year. Have a wonderful Holiday week. We will be here next firing off a few beautiful seasonal trades as well as set-ups for 2024.  Monster year and especially Q4.  But we want to end the year with a massive week.