New Month, New Hopes: Bulls Are Ready 03/11/2025

HOT stories for today

Market wrap:

• Wall Street heads into Monday on the back of a strong October, with major indexes having notched solid monthly gains. The S&P 500 rose 2.3% for the month, while the Dow Jones Industrial Average added 2.5%. The Nasdaq Composite led the pack, up 4.7%, driven by renewed enthusiasm for megacap tech. Amazon was a standout, as investors refocused on its strength in cloud computing alongside its retail operations. In macro news, Dallas Fed President Lorie Logan pushed back against expectations for near-term rate cuts, saying a softer labor market alone doesn’t justify backing off the fight against inflation.
• Bitcoin and broader crypto markets are starting the week in the red, while Asia-Pacific equities traded mixed after China’s PMI data missed expectations. South Korea’s Kospi led regional gains. Oil markets are steady as OPEC+ signaled a pause on additional output hikes beyond December amid growing supply concerns. In Washington, attention remains on the prolonged U.S. government shutdown, now on track to become the longest in history, with key economic data releases, including the monthly jobs report, already delayed. Separately, the Supreme Court is set to hear arguments this week on the legality of tariffs imposed during the Trump administration, a case with broad implications for U.S. trade policy.

Bulls Focus on the Fed’s QT Pivot

• Investors fixated on the Fed’s quarter-point rate cut and December outlook may be overlooking a quieter but equally important shift: the early end of quantitative tightening. Starting Dec. 1, the Fed will stop shrinking its $6.6 trillion balance sheet, months earlier than expected, and begin reinvesting proceeds from maturing Treasurys and agency securities into short-term bills.
• The move effectively halts a two-year effort to drain liquidity and marks a subtle turn toward looser financial conditions. “It’s a form of stealth easing,” said Will Compernolle of FHN Financial. “When the Fed stops shrinking its balance sheet, the private market can redirect funds toward risk assets and short-term funding.” The decision lands just before the Treasury’s quarterly refunding announcement, giving officials more room to rebuild cash reserves and issue bills without competing with the Fed for demand. While some see the move as tantamount to another rate cut, others call it a modest shift in the timeline. Either way, the liquidity boost could support equities and ease funding strains, even as long-term yields climb and policy divisions at the Fed widen.

Stocks on the move:
 

• Twilio (TWLO): Shares jumped 11% after the cloud communications company posted third-quarter results that topped expectations. Adjusted earnings came in at $1.25 per share on $1.3 billion in revenue, beating FactSet estimates of $1.08 per share on $1.25 billion.
• Western Digital (WDC): The stock rallied 9% as fiscal first-quarter results exceeded forecasts. The hard-drive maker reported adjusted earnings of $1.78 per share on $2.82 billion in revenue, above LSEG estimates of $1.58 per share on $2.73 billion.
• Intuitive Machines (LUNR): Shares gained nearly 5% after the company secured an $8.2 million contract extension from the U.S. Air Force Research Laboratory’s Space Vehicles Directorate to advance next-generation nuclear power systems for spacecraft and lunar infrastructure.
• Pony.ai (PONY): The autonomous driving startup’s stock climbed 5% after Shenzhen officials approved fully driverless commercial robotaxi operations, marking a major milestone in China’s self-driving sector.

Watchlist: AMZN, AAPL, PLTR, PONY, IDXX, RBLX, COIN, MSTR

Key Economic Events Today:

10:00 am: USD ISM Manufacturing PMI
10:00 am: USD ISM Manufacturing Prices
12:00 pm: USD FOMC Member Daly Speaks


Earnings

BMO (Before Market Open): IDEXX Laboratories (IDEX), Ares Management (ARES)
QMC (After Market Close): Palantir Technologies (PLTR), Vertex Pharmaceuticals (VRTX)


The TEFS Analyst team wishes you a successful day!