Wall Street Lunch: Cash Is King In ’23

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With charges surging, $1.3 trillion flowed into money, greater than any asset class. (0:15) Microsoft’s ‘iPhone second.’ (2:06) Cathie Wooden sheds remaining stake of Grayscale. (2:55)

The next is an abridged transcript:

Our high story right this moment to date

Money was certainly king.

Traders piled into money this yr because the Fed continued its unprecedented tightening cycle, whereas U.S. debt additionally noticed file inflows.

BofA Securities strategist Michael Hartnett highlights in his “Movement Present” be aware that money noticed $1.3 trillion of inflows in 2023. A file $177 billion moved into U.S. Treasuries, whereas $162 billion flowed into funding grade bonds. Inflation-protected Treasuries, or TIPS, noticed file redemptions of $37 billion as charges rose and inflation waned.

World shares noticed inflows of $152B. U.S. large-cap shares had inflows of $125 billion. Tech had inflows of $44 billion. And there was a file $73 billion in redemptions from U.S. worth funds.

In right this moment’s buying and selling

Shares are uneven, however the bias continues to be in the direction of the inexperienced in absence of any main catalysts.

The foremost averages are up round +0.2%.

Among the many early financial indicators, weekly preliminary jobless claims rose to 218K, topping the 210K anticipated and up from 206K prior. Persevering with claims rose to 1.875 million from 1.861 million prior.

And pending dwelling gross sales stalled in November, with the index staying at 71.6, in contrast with 0.8% progress anticipated. Yr-over-year, pending transactions dipped 5.2%.

Lawrence Yun, chief economist on the Nationwide Affiliation of Realtors, mentioned that “Though declining mortgage charges didn’t induce extra homebuyers to submit formal contracts in November, it has sparked a surge in curiosity, as evidenced by the next variety of lockbox openings.”

Amongst energetic shares

There’s extra on the AI entrance.

Microsoft’s (MSFT) “iPhone second” is right here, in line with Wedbush. The financial institution bumped its worth goal to $450 from $425 after latest AI buyer checks confirmed “recreation altering” monetization of Copilot, its generative AI characteristic launched earlier this yr. Wedbush maintained an Outperform ranking on the inventory, which is on its “Finest Concepts Listing” for 2024.

Baidu’s (BIDU) generative AI chat software Ernie Bot has amassed greater than 100 million customers, mentioned the corporate’s chief expertise officer.

And Argus Analysis had bullish commentary for Intel (INTC), citing developments in AI and its newly-announced foundry in Israel. Analyst Jim Kelleher, who boosted his worth goal to $60 from $42, mentioned the fourth-quarter ought to begin to present optimistic high and bottom-line comparisons.

In different information of be aware

Cathie Wooden’s ARK Subsequent Era Web ETF – image ARKW — dumped its remaining holdings of Grayscale Bitcoin Belief (OTC:GBTC) and bought 4.3 million shares of ProShares Bitcoin Technique ETF (BITO). The fund disclosed the end-of-year revamp late Wednesday.

ARK offered the GBTC shares out of “an abundance of warning,” Wooden mentioned in an interview with Bloomberg Tv.

“We’re nonetheless as optimistic about bitcoin as we ever have been,” she added

AKRW offered 148,885 shares of Coinbase World (COIN), 231,102 shares of Block (SQ) and 281,284 shares of UiPath (PATH). The ETF additionally added 20,000 shares of the ARK 21Shares Energetic Bitcoin Futures Technique ETF (ARKA).

For the yr, the ARK Subsequent Era Web ETF climbed 108%. Grayscale Bitcoin Belief surged 342% and Coinbase soared 451% on rising optimism, particularly previously month, that the SEC will approve a spot bitcoin ETF early subsequent yr.

And within the Wall Avenue Analysis Nook

The lists of what to purchase subsequent yr hold coming.

Morgan Stanley’s fairness gross sales crew recognized 24 inventory longs for 2024, all with vital upside to the Wall Avenue consensus anticipated.

Among the many names throughout a broad vary of sectors are:

Biogen (BIIB), Intel (INTC), Sony Group (SONY), Seagate (STX), Goal (TGT) and Disney (DIS).

Editor’s Be aware: This text discusses a number of securities that don’t commerce on a serious U.S. alternate. Please concentrate on the dangers related to these shares.