Wall Street Turns Cautious After Record Close While Bitcoin Sizzles: Analyst Says Blast-Off From October Lows Points To Early Stages Of Bull Market

Despite the Nasdaq and S&P 500 closing at record highs last week, Wall Street sentiment has shifted towards caution as U.S. stock indices largely pointed to a weak open on Monday. While most analysts predict a sustained bull run, traders are likely to be more cautious before making their next moves.

This week, traders might focus on Fed speeches and labor market data, as the Federal Reserve enters a quiet period before its March 19-20 FOMC meeting. The flow of earnings reports continues to slow down.

The recent buoyancy in the cryptocurrency market suggests a risk-on mood, which could potentially influence the stock market.

Cues From Last Week’s Trading:

U.S. stocks ended the week mostly higher on March 1, with small-caps leading the gains. The market fluctuated throughout the week, reacting to various economic data releases. Thursday’s inflation data, a key metric for the Fed, came in line with expectations, prompting traders to buy stocks.

“While it may appear imprudent for the markets to be so fearlessly optimistic, it’s very much a function of the market construction, where the concentration of the leaders is at decades high and thanks largely to the AI momentum, their prospects for further growth continue to improve,” said fund manager Louis Navellier.

“Perhaps the best news of the week is that the Russell is leading. A widening of the breadth should lead to sustained gains ahead.”

Index Performance In Week Ended March 1

Index	Performance (+/-)	Value
Nasdaq Composite	+1.74%	16,274.94
S&P 500 Index	+0.95%	5,137.08
Dow Industrials	-0.11%	39,087.38
Russell 2000	+2.96%	2,076.39

Notwithstanding the overbought levels, an analyst is optimistic about the uptrend continuing. Carson Group’s Ryan Detrick noted that the S&P 500 Index has gained 21.5% over the past 4 calendar months. Looking at precedence, the analyst noted that in the past, 15 times the index has gained more than 20% in four months.

The market was higher over the next six months and over a year in each of the 15 times, Detrick said. “Again, the blast we’ve seen off the late Oct lows is consistent with the early stages of a bull move,” he added.

S&P 500 up 21.5% the past 4 calendar months.

15 previous times it gained >20% in 4 mos, what happened next?

Higher 6 mos later 15 times.

Higher a yr later 15 times.

Again, the blast we've seen off the late Oct lows is consistent with the early stages of a bull move.

🐂🎯💪 pic.twitter.com/xcGeuimtaf

— Ryan Detrick, CMT (@RyanDetrick) March 4, 2024

Futures	Performance (+/-)
Nasdaq 100	-0.08%
S&P 500	-0.11%
Dow	-0.19%
R2K	+0.53%

In premarket trading on Monday, the SPDR S&P 500 ETF Trust SPY slipped 0.09% to $512.41 and the Invesco QQQ ETF QQQ edged 0.01% to $445.57, according to Benzinga Pro data.

Upcoming Economic Data:

A slew of labor market readings, the Federal Reserve’s Beige Book and Fed speeches dominate the proceedings on Main Street this week.

The Labor Department’s non-farm payrolls report for February, the routinely scheduled weekly jobless claims data, the final fourth-quarter productivity report, and the results of the January Job Openings and Labor Turnover survey are among the labor market statistics on tap this week. The other noteworthy data due include the January outstanding consumer credit report, the January factory orders report, and the Institute of Supply Management’s service sector data for February.

Philadelphia Fed President Thomas Harker speaks is scheduled to speak on Monday at 12 p.m. ET.

The Treasury will auction three- and six-month notes at 11:30 a.m. ET.

See also: How To Trade Futures

Stocks In Focus:

• Macy’s, Inc. M jumped over 15% in premarket trading Arkhouse Management and Brigade Capital Management sweetened their takeover offer to the department store chain.
• Super Micro Computer, Inc. (SMCI) climbed over 12% after S&P Global announced it would join the S&P 500 Index, effective March 18, as part of the quarterly index rebalance. Deckers Outdoor, Inc. DECK, which is also set to join the index, gained over 4.50%.
• Crypto-linked stocks rallied as Bitcoin BTC/USD was within striking distance of regaining its all-time high of $69,000.
• Sea Limited SE is due to release its quarterly results before the market opens, and notable among those reporting after the close are AeroVironment, Inc. AVAV, GitLab Inc. GTLB, Paymentus Holdings, Inc. PAY and Stitch Fix, Inc. SFIX.

Commodities, Bonds, Other Global Equity Markets:

Crude oil futures edged down 0.16% to $79.84 in early European session on Monday after the commodity rallied 4.55% in the week ended March 1. The OPEC+ nations have reportedly agreed to roll over production cuts to at least until the end of the second quarter to prop up prices.

The yield on the benchmark 10-year Treasury note rose 0.021 percentage points at 4.203%.

The Asian markets closed on a mixed note, with caution remaining the underlying sentiment. While Japan’s Nikkei 225 Average pushed ahead to a new high, the South Korean and Taiwanese markets advanced solidly. The Chinese market ended with a moderate gain, while the mood elsewhere was subdued.

European stocks were mixed in early trading on Monday.

In the cryptocurrency market. Bitcoin topped the $65K level and is closing in on its all-time high.

Read Next: Bitcoin, Ethereum, Dogecoin Rally Amid FOMO: Analyst Predicts $100K On Table For King Crypto, Says ‘Watch It Like A Hawk’