My Thoughts on Today’s Key Market Events
Good morning traders 👋, I think there are a few fascinating moments to keep an eye on today. I feel the biggest focus for many of us is likely the jobs report, but earnings from Delta and Walgreens also present interesting opportunities. Let me share my take on these and how I believe they could play out.
How I Think About Trading the NFP
For me, today’s Non-Farm Payroll (NFP) report feels like the star of the week. The market expects job growth to slow to around 150,000 for December, down from 227,000 last month. If this plays out, it will be the weakest annual growth we’ve seen since 2019.
I feel unemployment and wages might hold steady, but mixed signals from other data sources make me think there’s room for surprises. And surprises, as we all know, can really move the markets!
Why I Believe NFP Matters
The NFP report feels like a monthly health check-up for the U.S. economy. It shows us how many people are getting hired, how unemployment is faring, and what’s happening with wages. The term "Non-Farm" excludes groups like agricultural workers, but the data still paints a strong picture of broader economic trends.
For traders like us, this data can shake up stocks, bonds, and currency prices—offering both risks and opportunities.
How I Might Trade the NFP Step-by-Step
Here’s how I feel we could approach the NFP:
1️⃣ Timing Matters: The report drops at 2:30 PM UK time, so I plan to be ready beforehand.
2️⃣ Focus on Key Pairs: I think EUR/USD or GBP/USD might see the biggest moves.
3️⃣ Wait Out the Initial Reaction: Markets often go wild right after the release. I feel it’s better to wait a few minutes for some clarity.
4️⃣ Watch for Patterns: Once the dust settles, I’ll look for steady directional moves. That’s where I believe the real opportunities lie.
5️⃣ Set Goals:
I aim to set a stop-loss to manage risk.
My target would be 2–3 times my potential loss for a favourable risk/reward balance. 6️⃣ Stay Flexible: Markets can be unpredictable. I think it’s essential not to cling to one idea if the data contradicts my initial expectations.
Delta Earnings: Optimistic About the Skies
I feel Delta Air Lines’ Q4 earnings could be a bright spot today. Analysts expect revenue to climb 4.6% to $14.87 billion, with adjusted net income forecasted at $1.15 billion, up from $826 million last year.
What I like about Delta is its strong demand for premium seating and a positive outlook on travel growth. With all 13 analysts covering the stock rating it a “buy,” I feel there could be a nice upside if the numbers meet or exceed expectations.
Walgreens: A Turnaround in Progress?
Walgreens feels like it’s in a tough spot after a challenging year. Shares are down over 60%, making it the worst performer in the S&P 500 for 2024.
Earnings today are projected to show modest sales growth at $37.33 billion, but adjusted earnings per share might drop to $0.38 from $0.66 last year. I think the company’s cost-cutting measures, including closing 1,200 stores by 2027, could be a step toward stabilising its operations.
There’s also speculation about a buyout by Sycamore Partners. If this materialises, I feel it could bring significant changes to Walgreens’ business structure.
Movers and Shakers
Here are some stocks I’m watching today:
Greggs (-1.43%): British food retailer Greggs missed analyst expectations, causing shares to drop.
Ubisoft (-7.89%): Shares hit a 10-year low following a delayed game release and weak sales forecasts. I feel the gaming industry’s pressures are weighing heavily on this stock.
Micron (+18% YTD): Despite a slight dip, I think Micron’s high-bandwidth memory demand for AI and data centres could drive long-term growth.
Macy’s (-2.02%): The retailer is closing more stores as it grapples with declining foot traffic and competition.
Upcoming Events to Watch
Here’s what I feel could impact the markets later today:
1:30 PM GMT
Canada Unemployment Rate (Dec): Expected to hold steady at 6.8%.
U.S. Non-Farm Payrolls: Expected growth of 150,000, steady unemployment at 4.2%, and wage growth of +0.3%.
3:00 PM GMT
Michigan Consumer Sentiment Index: Forecast to edge up slightly to 74.5.
Final Thoughts
I think today offers plenty of opportunities for traders who are prepared and patient. Whether it’s the NFP report, Delta’s earnings, or Walgreens’ turnaround efforts, I feel it’s important to stay flexible and focus on managing risk.
Let me know how you’re trading these events today. Wishing you happy and successful trading!
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Risk Warning
Trading and investing carry risks. You should seek professional advice before engaging in such activities. Leverage can amplify both gains and losses. Past performance is not indicative of future results. Full risk disclosure: http://nexxtgen.pro/risk.
Note: Prices and figures quoted were correct at the time of writing.
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