Market Perspective for January 13, 2020

Stocks added to their 2020 gains today with the S&P 500 Index gaining 0.70 percent. Technology pulled the market higher with SPDR Technology (XLK) gaining 1.35 percent. iShares PHLX Semiconductor (SOXX) rallied 1.27 percent, iShares Expanded Tech Software (IGV) 1.17 percent and iShares Expanded Tech Networking (IGN) 1.56 percent.

A phase-one deal between the U.S. and China will be signed this week. The U.S. lifted its “currency manipulator” designation on Monday after designating China as such in August 2019. Chinese stocks jumped on the news, as did the Chinese currency. iShares China Large-Cap (FXI) gained 1.71 percent. The yuan rallied to its highest level in six months versus the U.S. dollar. The bump from China helped iShares MSCI Emerging Markets (EEM) advance 1.59 percent.

The National Federation of Independent Business’ small-business confidence index for December is out on Tuesday. The reading was 104.7 in November.

The consumer price index increased 0.3 percent in December according to the consensus forecast.

The Empire State index, a gauge of manufacturing activity in the New York Federal Reserve Bank’s territory, is out on Wednesday, along with the Fed’s Beige Book.

Thursday brings December retail sales. Analysts predict 0.4 percent growth and 0.6 percent growth ex-autos. The Philly Fed releases its manufacturing activity index the same day. Several housing data points will also be released this week. The National Association of Homebuilders’ confidence index for January, along with housing starts and permits for December. The advance reading of the University of Michigan’s consumer sentiment survey will be released on Friday.

Earnings season kicks into high gear this week, starting with the larger of large banks. J.P. Morgan (JPM), Citigroup (C) and Wells Fargo (WFC) all report earnings on Tuesday before the bell. Analysts expect $2.35 in earnings from JPM.

Bank of America (BAC), U.S Bancorp (USB), Goldman Sachs (GS) and PNC Financial Services (PNE) deliver results on Wednesday, along with UnitedHealth Group (UNH), Alcoa (AA), CSX Corp (CSX) and SLM Corporation (SLM).

Bank of New York (BK), Synovus Financial (SNV), PacWest Bancorp (PACW), Synchrony Financial (SYF) and First Republic Bank (FRC) report on Thursday along with Kinder Morgan (KMI), Skyworks Solutions (SWKS) and Taiwan Semiconductor (TSM).

The week concludes with SunTrust Banks (STI), Regions Financial (RF), Citizens Financial Group (CFG), Schlumberger (SLB), Kansas City Southern (KSU) and Fastenal (FAST).

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