Market Review: December 29, 2022

Closing Recap

Thursday, December 29, 2022





DJ Industrials




S&P 500








Russell 2000





Equity Market Recap

·     Investors were in a buying mood Thursday with the S&P 500 and Nasdaq posting their biggest daily gains of December as all eleven S&P sectors finished decidedly higher. The moves helped erase yesterday’s broad-based sell off that took the S&P 500 to lows of 3,800, a sort of “line in the sand” level of late that the S&P has tested/bounced off the last few visits. Bespoke Investment noted 2022 is the first year in the history of the AAII Sentiment survey that bullish sentiment was below its historical average in every week of the year. The weaker sentiment has followed a raft of interest rate hikes by the Fed to try and slow inflation and cool the economy. Inflation data has shown a deceleration over the last few months, but also shown a sharp impact on the economy with slowing manufacturing and confidence, though jobs have stayed strong. The S&P 500 cash (SPX) key technical resistance levels remain higher, with the 50-day moving average (MA) around 3,895 and 100-day around 3,905. One common theme today was buying of beaten-up stocks of 2022 with shares of GNRC, SIVB, WBD, TSLA, ALGN, CTLT among the biggest gainers in the S&P on the day – all of which came into the day among the biggest year-to-date losers. The average rate on the standard 30-year fixed mortgage rose to 6.42% from 6.27% last week, according to a survey by the mortgage-finance giant Freddie Mac. It was 3.11% at the same time last year, marking their largest increase in any calendar year in 2022. Tomorrow ends the 2022 trading year, one that goes down in the record books as volatile, unpredictable filled with an aggressive Fed leading to negative returns for bonds and stocks.


Economic Data:

·     Weekly Jobless Claims rose to 225,000 in latest week from 216,000 (est. 225K); the 4-week moving average fell to 221,000 from 221,250 prior; continued claims rose to 1.710M, the first time above 1.7M since Feb 2022, and above the 1.669 mln prior week; the US insured unemployment rate unchanged at 1.2%

·     The U.S. 30-yr fixed rate mortgages averaged 6.42% in Dec 29 week vs 6.27% prior week


Commodities, Currencies & Treasuries

·     Oil prices finish lower, with WTI crude down -$0.56 or 0.7% to settle at $78.40 per barrel (off earlier lows of $76.79, extending losses on concerns that China’s rapid removal of COVID Zero policy could lead to a surge in cases across the world. Nymex Natural Gas for Feb. delivery lost -2.69% to $4.5590 per million British thermal units – up 28.03% from its 52-week low of $3.561 last December and off 52.90% from its 52-week high of $9.68 hit in August.

·     Gold prices rise $10.20 to settle at $1,826 an ounce, getting a boost from a decline in the dollar, which fell -0.6% vs. the euro at 1.0675. Treasury yields end lower, but off the worst level as the U.S. sold $35 bln in 7-year notes at high yield 3.921% vs. 3.913% when issued prior as bid-to-cover ratio 2.45, primary dealers take 15.75% of sale, directs 16.17% and indirects 68.08%. The weaker bond auction followed a disappointing 5-yr auction the day prior. The 10-yr yield hit lows around 3.825% vs. 3.885% highs.






WTI Crude















10-Year Note





Sector News Breakdown


·     BYND shares rise after MCD will offer Beyond Meat patties in its Double McPlant in all UK & Ireland restaurants starting Jan 4th

·     CALM shares fall as quarterly earnings missed expectations amid feed-cost inflation

·     China said it will tighten oversight of private tutors that offer non-curricular services to primary and middle school students, including rules on fee charges and operating time, Bloomberg reported (shares of TAL, EDU, GOTU slide)

·     For toy retailers, Davidson said Holiday Toy Survey showed out-of-stocks of featured toys on December 23, 2022, lower than in 2020. 13% vs. 17% for Walmart (WMT), 12% vs. 22% for Target (TGT), and 3% vs. 24% for Amazon (AMZN). In store at WMT and TGT, out-of-stocks were higher vs. 2020 and 2019, and certain brands did have bare shelves, like Mattel’s (MAT) Barbie.

·     In auto sector, TrueCar expects total new vehicle industry sales to reach 1.28M units in December, up 4.5% from a year ago and up about 4% from November, when adjusted for the same number of selling days. This month’s seasonally adjusted annualized rate for total light vehicle industry sales is an estimated 13.3M, up 3% from December 2021 – DJ

·     According to Yippit data, the number of orders placed on major food-delivery apps DASH, UBER and GRUB grew an average of 5% year-over-year in October and November, the slowest two-month growth since the pandemic


Energy, Industrials and Materials

·     WSJ article notes that lumber prices have tumbled – Wood-pricing service Random Lengths said that its framing-lumber composite index, which tracks cash sales in several species, dropped this week to $380, down more than 70% from early March and Benchmark wood-panel prices are down more than 80% from their peak earlier this year

·     In electric vehicle space (TSLA, LCID, FSR, NKLA), Senator Manchin calls on Treasury to pause implementing EV tax credits

·     HYZN said Hyzon Shanghai will sell its entire stake in Hyzon Guangdong to Hymas PTE Ltd, a Singapore-based private company, for ~$3.1 mln in cash

·     Precious metals and industrial metals saw solid gains with the dollar tumbling, as aluminum, gold, silver, copper miners outperforming on the day (AA, FCX, NEM)



·     The US said ABC’s distribution of controlled substances led to hundreds of thousands of violations of federal controlled substances act and civil penalties against AmerisourceBergen could total billions of dollars

·     ARDX said the FDA grants appeal for its kidney disease drug

·     FSTX shares fall as CFIUS objects Sino Biopharma deal

·     GEHC to replace VNO in the S&P500 at open on January 4th, 2023

·     HOTH rises after FDA after accepts IND application for its skin disorder treatment

·     LOOP downgraded to Neutral from Buy at HCW primarily driven by the near-term uncertainty around commercialization created by the company’s decision to sell its Bécancour site, departure of its CFO, and plans to curtail operations at the Terrebonne facility

·     PFE’s hemophilia B gene therapy succeeds in late-stage study

·     TGTX extended gains after FDA approved late yesterday its drug, Briumvi, for treatment of adult patients with relapsing forms of multiple sclerosis


Technology, Media & Telecom

·     For AAPL, the WSJ reported Covid-19 issues in China are still hampering manufacturing of Apple Inc.’s iPhone, but production is beginning to catch up to demand for the more-expensive Pro models, according to analysts and people involved in the supply chain

·     NFLX benefits from double upgrade at CFRA, while Internet and YTD biggest losers seeing buying interest early

·     Semiconductors bounce over 3% after what has been an awful 2022 (SOX index -37% YTD despite todays more than 3% recovery)


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.