GDP Growth Hits 2.3% vs 2.1% Expected—Growth Momentum Builds
Q4's 2.3% GDP growth, coupled with December's 2.9% inflation print, creates a delicate balance between growth and price stability. Here's how to position your portfolio for the Fed's next move.
KEY METRICS:
- Growth: 2.3% GDP vs 2.1% Forecast
- Inflation: CPI 2.9% vs 2.7% Prior Period
- Employment: 256,000 NFP vs 225,000 Consensus
MARKET REACTION:
- Equities: S&P 500 +0.8%, NASDAQ +1.2%, Dow +0.6%
- Bonds: 10-Year Treasury Yield up 5bps to 4.32%
- Currency: USD Index +0.4% to 103.5
WINNERS & LOSERS
- Outperforming Sectors: Technology, Consumer Discretionary
- Underperforming Sectors: Utilities, Real Estate
- Volume Leaders: Apple, Microsoft, Tesla
TECHNICAL SIGNALS
- Key Support: 4,850 on S&P 500
- Key Resistance: 5,000 on S&P 500
- Momentum Indicators: RSI at 62, showing room for upside
SHORT-TERM TRADERS (1-5 Days):
- Entry Points: Look for pullbacks to 4,850 support level
- Risk Management: Set stops below 4,825
- Catalyst Calendar: CPI data release next Tuesday
POSITION TRADERS (2-4 Weeks):
- Sector Rotation: Overweight Technology and Financial sectors
- Portfolio Hedges: Consider VIX calls for February expiry
- Risk/Reward Setups: 3:1 target on S&P breakout plays
WATCH LIST:
- Economic Calendar: CPI (Feb 13), Retail Sales (Feb 15), FOMC Minutes (Feb 21)
- Fed Speakers: Powell testimony (Feb 12), Williams speech (Feb 14)
- Earnings Calendar: Nvidia (Feb 21), Walmart (Feb 20)
RISK RADAR:
- Primary Risk: Sticky inflation could force Fed to delay rate cuts
- Hedge Strategy: Long duration Treasuries, gold exposure
Sources:
- Bureau of Economic Analysis (GDP Data)
- Federal Reserve Economic Data (FRED)
- Bureau of Labor Statistics (Employment and Inflation Data)
- Trading Economics (Global Markets Data)
- International Monetary Fund (Global Economic Projections)