By Vivien Lou Chen and William Watts
Read: The S&P 500 narrowly averts a bear market. How long do they last once they arrive? Significant skepticism remains toward the idea stocks have put in a lasting bottom. Researchers at New York-based BlackRock, the world’s largest asset manager, turned neutral on developed-market stocks like those of the U.S. and said they see no catalyst for a sustained rebound in assets perceived as risky right now.At Jefferies, Sean Darby, global equity strategy, and others wrote in a note on Monday that their analysis suggests “that, despite investor sentiment surveys being quite bearish, there has not been the cathartic selling that would accompany a market bottom.”
“If we are correct, then the final part of the earnings momentum cycle is a combination of both earnings cuts and a slice in target prices. Investors should be conservatively positioned,” the team at Jefferies wrote.
Appetite for risk weighed on the dollar. The ICE Dollar Index /zigman2/quotes/210598269/delayed DXY -0.11% , which measures the greenback against a basket of major currencies, dropped 1%. Oil futures flipped between gains and losses to end virtually unchanged, with the U.S. benchmark /zigman2/quotes/211629951/delayed CL.1 +0.88% ending a penny higher at $110.29 a barrel. Gold prices /zigman2/quotes/210034565/delayed GC00 +0.20% eked out a 0.3% gain , settling at $1,847.80 an ounce.
There is no U.S. economic data on the calendar for Monday, but investors will keep an eye on the World Economic Forum in Davos, Switzerland, which is back after a two-year absence.
Also read: Davos’ post-COVID return laden with climate, economic woes and a war in Europe
What companies were in focus?
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Shares of VMware Inc. /zigman2/quotes/209864107/composite VMW +0.18% finished 24.8% higher after reports chip maker Broadcom Inc. /zigman2/quotes/200646538/composite AVGO -1.31% was in talks to buy the enterprise cloud-computing company. Broadcom shares closed down by 3.1%.
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Shares of JPMorgan Chase & Co. /zigman2/quotes/205971034/composite JPM +0.96% ended 6.2% higher to lead Dow gainers after the banking giant raised its net interest income outlook. In addition, JPMorgan’s forecast that it may hit its goal of a 17% return on tangible equity this year was one of the most bullish developments coming out of its Investor Day meeting Monday, according to Wells Fargo analyst Mike Mayo.
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Shares of fellow Dow component Goldman Sachs Group Inc. /zigman2/quotes/209237603/composite GS -0.25% finished up by 3.2%. Shares of other banks also got a lift. Bank of America Corp. /zigman2/quotes/200894270/composite BAC +1.08% and Wells Fargo & Co. /zigman2/quotes/203790192/composite WFC +0.68% shares closed up by 5.9% and 5.2%, respectively.
How did other assets fare?
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The yield on the 10-year /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y +0.94% note rose 7.2 basis points at 2.857%, the largest one-day gain in almost a week.
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Bitcoin /zigman2/quotes/31322028/realtime BTCUSD +0.38% was down 2% near $29,324.
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In European equities, the Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP +0.16% finished up by 1.3%, while the FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.36% gained 1.7%.
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In Asia, the Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.28% finished flat, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.84% fell 1.2%. Japan’s Nikkei 225 index /zigman2/quotes/210597971/delayed JP:NIK +1.04% rose 1%.
—- Barbara Kollmeyer contributed to this article.
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