On Thu, 23 Jan 2025, US stocks rose to their first all-time high of 2025 as Wall Street regained a bit of the momentum that catapulted it to 57 records last year.
By the time 4pm came around:
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DJIA : +0.92% (+408.34 to 44,565.07).
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S&P 500 : +0.53% (+32.34 to 6,118.76). Surpassed record it set last month.
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Nasdaq : +0.22% (+44.34 to 20,053.68)
Investors have been assessing a mixed bag of quarterly corporate earnings and digesting comments from returning President Trump that included a call for cuts in interest rates and oil prices.
In his televised “thug-like” speech at the World Economic Forum in Davos, Switzerland, Trump demanded that OPEC lower oil prices and that the Fed reduced interest rates.
All the while warning global business leaders they will face tariffs for products made outside of the U.S. It’s déjà vu 2017 all over again !
The bad news is that it is only the beginning of 4 years of horror, all over again.
Sector Performances.
The Top 3 sectors of the day were:
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Healthcare (XLV) : +1.34%.
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Industrial (XLI) : +1.01%.
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Real estate (XLRE) : +0.80%.
US Weekly jobless claims.
For week ending 18 Jan 2025, the number of jobless claims filed rose marginally by +6,000 claims to 223,000. (see above)
Economists polled by Reuters had forecast 220,000 claims, -1.35% lower than actuals.
Claims were lifted by the wildfire in Los Angeles, with unadjusted applications increasing in California, but falling in the majority of states.
More fallout from the LA wildfire situation seems likely going forward as the fire rages on.
Not forgetting the historic snowstorm in the South (for week beginning 19 Jan 2025) would also add to current week’s tally.
Overall, it suggests no deterioration in US labour market conditions, strongly reinforcing expectations that the Fed would not cut interest rates in next week FOMC meeting.
With the Trump administration back in office since Mon, 20 Jan 2025 and immediately endorsed executive orders to (a) immigration crackdown, (b) plans for tax cuts and (c) broad tariffs levied at Mexico, Canada & China.
These aggressive action-plans will exert unnecessary inflationary pressure on the US economy, giving the Fed reasons to stay on course of its monetary policy to “prevent” creeping inflation from resurfacing.
$GE Aerospace(GE)$
When conglomerate General Electric split into 3 separate entities in April 2024, GE Aerospace is the entity that I am most curious.
3 quarters on, it is still exceeding Wall Street expectations.
On Thu, 23 Jan 2025, GE Aerospace released their Q4 2024 earnings that scored a breakout Thursday.
The jet engine and defense manufacturer topped estimates (again!) for Q4 results and (very important), provided an optimistic outlook and stepped up shareholder returns.
Quarterly earnings:
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Earnings per share (adjusted) : up +103% YoY to $1.32 per share vs Wall St expectations of $1.04.
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The earnings gain was the best in 6 quarters while it was the best revenue increase in years.
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Revenue was up +16% YoY to $9.90 billion vs FactSet forecasts of $9.49 billion.
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Total orders during the quarter jumped +46% to $15.5 billion.
FY 2025 Outlook.
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Earnings per share (adjusted) : $5.10 - $5.45 per share; with the midpoint just above FactSet estimates of $5.23 per share.
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Revenue : GE Aerospace expects low double-digit revenue growth, vs FactSet predicts about +11% sales growth to $38.99 billion.
US aerospace industry is a global leader, encompassing commercial aviation, defense, and space sectors.
While it's a significant economic driver, profitability can be cyclical and influenced by factors like (a) fuel costs, (b) geopolitical events, and (c) technological advancements.
Case in point
Other US-listed aerospace companies, such as $Boeing(BA)$ and $Lockheed Martin(LMT)$, also experience fluctuations in profitability.
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Boeing, has been impacted by the 737 MAX crisis, production delays exacerbated by union labour strike.
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Lockheed Martin's performance is often tied to government defense spending.
US aerospace industry remains a vital sector, but it operates within a dynamic and competitive global landscape. Still interested in investing in them?
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Do you think GE Aerospace is a better investment than Boeing ?
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Do you think GE Aerospace is better choice than Lockheed Martin?
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