Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

DATA/HEADLINES   9:45ET MNI Chicago PMI; 2:00ET Cash Bond Market Close

Wishing Everyone a Happy New Year!

TODAY’S HIGHLIGHTS and News:  

• Global merger and acquisition activity in 2023 fell 17%
• There is $1.9 Trillion of net treasury coupon supply in 2024 vs ~$1 Trillion in 2023
• Russell 2000 on pace for its best December in history
  
• Maine became the second US state to bar Donald Trump from a Republican presidential primary ballot
• Most of Wall Street was dead wrong in 2023 with recommendations to sell US stocks, buy Treasuries, buy Chinese stocks
• Border Patrol has processed more migrants who entered the US illegally in December than in any other month in the agency’s history

World stocks eked out one last gain on the final trading day of the year as global shares stayed on track for their best annual performance since 2019. The MSCI All
Country World Index has rallied about 20% this year. Global bonds, meanwhile, remained on track for their biggest two-month gain on record.   

EQUITIES: 
 

US equity futures are steady after the S&P 500 traded just a few points away from its all-time high on Thursday, extending its 2023 advance to nearly 25%.  Nasdaq 100 index is on track
for its best year since 1999.  The three main indexes also eyed their ninth straight weekly gain. Information technology is set to be the top sectoral gainer in 2023, up ~56%, benefiting from AI exuberance and a surge in megacap stocks. Among corporate movers,
Uber Technologies and Lyft fell overnight on a report that Nomura downgraded the ride-sharing platforms.

Futures ahead of the bell: E-Mini S&P -0.05%, Nasdaq -0.05%, Russell 2000 -0.05%, Dow 0.0%.

In pre-market trading, Fisker (FSR) gains ~10% after the EV maker said it grew deliveries by over 300% from 3Q to 4Q. Lyft (LYFT) drops 2.8% after an insider sold shares in the company
and as Nomura cut the stock to reduce from neutral. Uber (UBER) -1.3%. Rexford Industrial (REXR) +5.0%, Marathon Digital Holding (MARA) +3.0%, Transocean (RIG) +2.5Altice USA (ATUS) gains 4.6%, adding to a recent rally that’s put shares on pace for their best
month on record.     

European stocks edged higher, headed for the best year since 2021 after hopes for central bank pivots fueled a strong year-end rally. The Stoxx Europe 600 index inched up 0.2%, looking
at a 13% advance for the year. Trading volumes were low, with a number of regional markets including Germany and the UK closing early today. Consumer products and energy shares outperformed, while real estate lagged. DAX +0.2%, CAC +0.3%, FTSE 100 +0.1%. Energy
+0.4%, Media +0.4%, Insurance +0.4%. REITs -0.6%, Basic Resources -0.3%. 

Shares in Asia were mixed. The MSCI Asia Pacific Index fell as much as 0.4% before paring declines, with Alibaba and Xiaomi among the biggest drags. Japan’s benchmarks capped their best
yearly performance since 2013. Consumer electronics shares in China surged as data showed electronics production rose 10.6% in November from a year earlier, faster than 4.8% in the previous month. Markets in South Korea and Thailand were closed for holidays.
MSCI Asia Pacific Index -0.1%. Singapore +0.8%, CSI 300 +0.5%, Topix +0.2%, Taiwan and Vietnam +0.1%, Hang Seng Index +0.02%. Sensex -0.2%, ASX 200 -0.3%, Philippines -1%.   

FIXED INCOME: 
 

Treasuries extended to Thursday’s losses, with the 10-year yield rising four basis points. Yields are higher by 1bp-2bp at short end, 3bp-4bp at long end, still inside
weekly ranges that included lowest levels since at least July. Market is on pace for its second straight monthly gain of more than 3%, extending first annual gain since 2020. 10 year yield 3.885%, 2 year yield 4.295%. 2s10s cure +2.5bps.

METALS: 
   

Bullion was steady on the final trading day, putting it on track to end the year about 13% higher. Gold headed for its first annual gain in three years as investors
doubled down on bets that the Federal Reserve will start to unwind its restrictive monetary policy stance in 2024. Spot gold is flat, silver -1%.   

ENERGY:  

Oil is set for its biggest annual drop since 2020 as war and OPEC+ production cuts failed to lift prices.  Brent crude edged higher toward $78 a barrel but is set
to close 2023 about $8 below where it started the year. Oil ended lower on Thursday after official US data showed that stockpiles at the key Cushing, Oklahoma, storage hub expanded for the 11th week to hit the highest since August. US crude production has
been running at a record clip. WTI and Brent +0.7%, US Nat Gas -0.9%, RBOB +0.3%.      

CURRENCIES:   

In currency markets, the dollar was steady against most of its major peers amid thin liquidity. It’s on track for the worst annual loss since the onset of the pandemic
on expectations the Federal Reserve will cut interest rates aggressively in 2024. The dollar is down 2% on the year. Japan’s seeming reluctance to raise interest rates and China’s sputtering economy mean the yen and yuan are down 7.5% and 3% respectively.
Colombia and Mexico’s pesos are up 25% and 15% on the year. The safe-haven Swiss franc has jumped 10% to score its strongest year since 2010. A growing number of currency funds are looking to beaten down currencies that could benefit from lower interest rates
as they attempt to replicate 2023’s blockbuster returns from the carry trade. Betting on a so-called value strategy is now being adopted by an increasing number of investors, according to Bank of New York Mellon.  US$ Index +0.05%, GBPUSD -0.15%, USDJPY +0.1%,
EURUSD -0.1%, AUDUSD -0.6%, USDCHF -0.7%.  

Bitcoin +0.8%, Ethereum +0.6%. 

TECHNICAL LEVELS: 

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Initiations
• AB InBev (ABI BB) ADRs Rated New Neutral at Haitong Intl; PT $69
• Annovis Bio (ANVS) Rated New Buy at Canaccord; PT $36
• McCormick (MKC) Rated New Neutral at Haitong Intl; PT $70.13

Data sources: Bloomberg, Reuters, CQG