The futures were higher as we began the first trading week of 2023, albeit a shortened one due to the New Year holiday. All the major indexes closed lower to end 2022 last Friday, with the Nasdaq once again leading the way. The tech-heavy index closed down a stunning 33% last year, while the S&P 500 barely dodged bear market status by closing down 19.44%. The Dow Jones industrials fared the best, down 8.82%. Last year marked the worst one for stocks since the 2008 financial crisis.
The view from Wall Street strategists is also not very rosy to start the new year. Many feel that the Federal Reserve will continue to raise rates when it meets at the end of January, but the coming rate hikes may very well be of the 25-basis-point variety as federal funds creep closer to the expected terminal rate of 5.00% to 5.25%.
Yields ended 2022 higher across the curve, as sellers once again held the upper hand on the final trading session. The benchmark 30-year bond closed at 3.98%, once again approaching the 4% level. The 10-year note closed at 3.88%, which kept the widening inversion with the two-year paper in place, as the latter closed the day at 4.43%. Bond market pros see the inversion as a tell-tale recession sign.
Brent and West Texas Intermediate crude both closed solidly higher to end the year. Many across Wall Street feel that the energy sector, which was one of the few winners in 2022, may be poised for another banner year. Natural gas once again closed lower at $4.44, down almost 3%, ending a bad week despite the record winter storms that blew across the United States during the Christmas holiday weekend. Gold closed higher on the day, while Bitcoin ended lower, closing out a horrific year for the cryptocurrency.
24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top analyst upgrades, downgrades and initiations seen on Tuesday, January 3, 2023.
Ally Financial Inc. (NYSE: ALLY): Barclays downgraded the bank to Equal Weight from Overweight and lowered its $40 price target to $33. The consensus target is $32.40. The stock closed on Friday at $24.45.
AmerisourceBergen Corp. (NYSE: ABC): BofA Securities reiterated a Buy rating with a $176 target price. The consensus target is $177.25., and the final trade on Friday was for $165.71 a share.
Apple Inc. (NASDAQ: AAPL): Exane BNP Paribas downgraded the tech giant to Neutral from Outperform and has a $140 target price. The consensus target is $176.20, and shares ended Friday trading at $129.93.
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