QQQs started off the new year down 1.7%. SPX was only down 56bps and IWM only down 50bps. ARKK underperformed -3.5% despite TSLA finishing flat. Not a lot to point to for weakness - heard things such as it’s not abnormal for Jan 2nds to be down in election years, AAPL downgrade dragging down Large cap with it, and momentum outflows as investors wait for NFP this Friday and CPI next week. China was down 3% post-mixed econ news and Xi’s comments around Taiwan unification (“The reunification of the motherland is a historical inevitability…China will surely be reunified.”)
Slow news day and a lot of the moves driven by flows today, but I’ll recap some of the movers….
In internet, not a lot of news. Desks some dip buying in AMZN and some point to Prime Video Ads launching later this month although that news was out last week. Some underperformers last year outperformed with EBAY up 50bps, PYPL/ETSY/MTCH flat. Some momentum names which were strong to end the year were down big: SHOP dn 5%, and RBLX dn 6%. On RBLX, we are likely to get 3p data for Dec soon, where the bookings comp got tougher post Nov so am expecting a decel there although they should still land above the street for the q. Other key movers: SNAP down 4.7%, NFLX dn 4%, META down 2%. TTD down 2% post positive mentions at ISI and Loop. DASH-2.5% on an FT article calling out potential international expansion. Ride share names down big with UBER -5% and LYFT -8%. SPOT up 50bps as Benchmark raised PT to $260 saying they expect them to surprise on both opex leverage and new accretive pricing tiers in 2024. Chinese internet names underperformed with JD down 6%, BABA down 3.5%, BIDU down 3%. PDD was the lone outperformer down 50bps on the back of Benchmark’s note making it a top pick for 2024. Interestingly, casino stocks were up 4% on better Macau revenues pointing to a China recovery story.
In software, only a couple green names across the space: APPS +1% and AI +10bps. U fell 6% on the back of Piper’s dg saying the stock had moved too much too fast. ORCL and MSFT dn 1.3%. Other large caps didn’t fare as well: WDAY dn 3%, CRM dn 2.7%, INTU dn 3.5%, ADBE dn 3%. Cloud stocks were weak: MDB dn 6%, DDOG/SNOW dn 5%, ESTC dn 5.5%. CFLT -3% was the outperformer among cloud stocks as Needham added to top pick (replacing MDB) as they expect growth to re-accelerate into 2025. Other losers: HUBS dn 5.5%, TEAM dn 5%, and TWLO dn 6%.
Semis underperformed down 3.3% although very little to point to outside of the ASML “news” and Xi’s commentary, and maybe some sell the news in front of CES next week. SMCI was one of few green closes up 40bps. ARM was the big loser down 8% and AMD down 6%. INTC was down 5% - only thing I saw was a negative mention at Bernstein calling out tougher foundry competition from TSMC. Other movers: NVDA -2.7%, WDC -3%, AVGO -3%, MU - 3.5%
Elsewhere, AAPL dn 3.5% on the back of Barclays downgrade/UBS note calling out weak checks + FT article noting weaker services revs and regulatory overhangs. TSLA finished flat on the day delivering 485k deliveries vs street at 483k and bears in the 470s. RIVN didn’t fare as well as investors were disappointed with the deliveries number of 14k vs street at 14.1k and buyside a bit higher. Telecom names outperformed with VZ and T +2-3%
In Fintech, BTC was up 3%, but COIN fell 10% as new crypto tax reporting obligations took effect on Jan 1…
Also, would seem logical to think COIN might lose some market share with BTC ETF given it’s a lower fee way to trade BTC. PYPL was flat while SQ fell 8%. AFRM and UPST were down 5% each.
That’s all for today - see you in the AM!
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