In anticipation of the biggest sporting event in the United States, the Super Bowl, we thought a nice spread of easy-to-digest financial finger foods would be delicious. With well over 100 million viewers expected, the event clearly has broad appeal; whether that is for the football, the commercials, or the halftime show, it is sure to be quite a production. Regardless of why you tune in (or even if you don’t), we hope you have a great weekend. Enjoy the informative appetizers below!
No Inflation in Super Bowl Ads. Last year’s Super Bowl had the highest share rating (77) since Super Bowl X in 1976. The average 30-second ad cost $7 million, and for this year’s Super Bowl between the Kansas City Chiefs and San Francisco 49ers, it is set to remain at the same mark as last year. This is only the 11th time in 57 years that prices haven’t increased compared to the prior year. (Source: superbowl-ads.com)
First Impressions Matter. In the 40 years since WWII, when the S&P 500 was up at least 1.5% in January, its median performance for the remainder of the year was a gain of 13.4%, with positive returns 82.5% of the time. In all other years, the S&P 500’s median gain was 5.7%, with positive returns 66.7% of the time. (Source: Bespoke)
Earnings Beats are Improving. 72% of the more than 500 companies that had reported Q4 2023 earnings through February 7 reported stronger than expected EPS compared to a historical EPS “beat” rate of 65% over the last ten years. Stocks that beat EPS estimates rallied more than 2% on the first trading day following their earnings reports this season, or about 50 basis points more than usual. (Source: Bespoke)
Back Into the 2s. After coming in at 3.4% in December 2023, the Cleveland Fed’s CPI Nowcast inflation estimate tool currently projects YoY CPI to fall to 2.9% in January 2023. A YoY CPI reading in the 2s would end a 33-month streak above 3%, the longest stretch since 1991. (Source: Cleveland Fed)
Used Car Prices Plunge. According to automobile auction company Manheim’s Used Vehicle Value Index, used car prices fell another 1% in January. While Manheim’s index shows used car prices declining 21% from their all-time high in December 2021, data from Cargurus.com shows that the value of a used Tesla has dropped 49% from $67,900 in July 2022 to $34,883. (Source: Manheim, Cargurus.com)
Turn on the faucet. According to the NY Fed’s quarterly Household Debt and Credit report, 8.5% of credit card loans became newly delinquent in Q4 2023, the highest reading since Q2 2011. Credit card utilization also increased to 23.5% in Q4, the highest reading since Q4 2019, just before COVID hit. (Source: NY Fed)
Economy
- Markets were higher this week as the S&P 500 cracked the 5,000 mark, with the S&P 500 up 1.4%, the Nasdaq up 2.3%, and the small-cap Russell 2000 up 2.4%.
- The S&P Global US Services PMI was revised lower to 52.5 in January from a preliminary of 52.9 but continued to point to the most robust growth in the services sector in seven months.
- Those claiming unemployment benefits fell by 9K to 218K from the prior week’s upwardly revised value in the February 2 report, slightly below estimates of 220K but remaining firmly above the average from the last two months.
Stocks
- U.S. equities were in positive territory. Technology and Consumer Discretionary were the top performers, while Utilities and Consumer Staples lagged. Growth stocks led value stocks, and small caps beat large caps.
- International equities closed higher for the week. Emerging markets fared better than developed markets.
Bonds
- The 10-year Treasury bond yield increased 15 basis points to 4.19% during the week.
- Global bond markets were in negative territory this week.
- High-yield bonds led for the week, followed by government bonds and corporate bonds.
