In this month's issue:
Copper Is Seeing Red
A couple of months ago, in this publication, we wrote about the prospects for uranium in the context of the almost ubiquitous employment, or at least acceptance, of nuclear energy as a means to solve the world’s need for plentiful, consistent, and clean energy. We referenced the years of underinvestment in uranium mining that is complicating the ability to fulfill the existing demand without consideration for future developments that could lead to supply imbalances for years to come. We also mentioned copper being in a similar position.
As one of the red metals, which include brass and bronze, copper (atomic number 29, and symbol Cu on the chemical periodic table), is a soft element renowned for its conductivity. Historically, it has been referred to as “Dr. Copper” due to what many consider, perhaps somewhat tongue in cheek, that it is the only metal with a PhD in economics. The title infers an academic ability to provide unusual insight into the health of the global economy. Why? Because copper possesses the ability to transmit electricity efficiently and is widely utilized in the early stages of almost all industrial activity and construction, both of which are barometers of economic fitness.
4 Key Issues for 2024
As an annual follow up to Investment Perspectives’ “Year in Review,” this second issue of 2024 will focus on four key themes that we believe will dominate the bond markets for the remainder of the new year.
In 2023, we identified the risk of a policy error (“we have yet to feel the downside from rate hikes”), disinflation (“core CPI could end up running below 2% by late-2023”), construction jobs (“recession is largely contingent on builder layoffs”), and credit confidence (“credit market performance hinges on market confidence”) as the major themes for the year. Three of these key themes proved significant, and the fourth was a nothingburger.
In the short term, the stock market reacts to a wide range of items, but in the long run, earnings are what really matter.
The earnings report barrage this month is critical to the stock market’s intermediate-term direction as the earnings bar for some of the market’s most prominent names is quite high, especially considering the rise in the price of their stocks in a very short period.
In recent months, the stock market has focused on the potential that 2024 earnings could be up by a low double-digit percentage, but lately that assumption has been questioned.
The information herein is for informative purposes only and in no event should be construed as a representation by us or as an offer to sell, or solicitation of an offer to buy any securities. The factual information given herein is taken from sources that we believe to be reliable, but is not guaranteed by us as to accuracy or completeness. Charts and graphs are provided for illustrative purposes. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation or needs of individual investors.
The concepts illustrated here have legal, accounting, and tax implications. Neither Janney Montgomery Scott LLC nor its Financial Advisors give tax, legal, or accounting advice. Please consult with the appropriate professional for advice concerning your particular circumstances. Past performance is not an indication or guarantee of future results. There are no guarantees that any investment or investment strategy will meet its objectives or that an investment can avoid losses. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments based on that index. A client’s investment results are reduced by advisory fees and transaction costs and other expenses.
Employees of Janney Montgomery Scott LLC or its affiliates may, at times, release written or oral commentary, technical analysis or trading strategies that differ from the opinions expressed within. From time to time, Janney Montgomery Scott LLC and/or one or more of its employees may have a position in the securities discussed herein.