Market Monitor February 6th

Market Recap: Wall Street Gains, Amazon Slips, and U.S. Job Growth Slows

Wall Street: The U.S. stock markets closed mostly higher, except for the Dow Jones (-0.3%). Ford dropped more than 7% after issuing a disappointing 2025 outlook, despite solid quarterly results. Salesforce declined 4.9% following the announced departure of COO Brian Millham. Eli Lilly gained 3.4% on strong earnings, while Honeywell lost 5.6% after announcing plans to split its business.

Amazon: The company is investing over $100 billion in AI and cloud, but disappointed investors with a weak revenue forecast for the current quarter. The stock fell 5% in after-hours trading. CEO Andy Jassy called AI the biggest technological shift since the internet and stressed the need for massive investments.

U.S. Job Market: The U.S. economy added 143,000 jobs in January, fewer than expected, but wages grew by 4.1%, exceeding forecasts. Unemployment fell to 4%. Markets initially reacted negatively but seems to recover.

Market Overview

Major Indices:

• The S&P 500 (SPY) is in an uptrend, gaining 0.35% on the day.
• The Nasdaq 100 (QQQ) also shows strength, rising 0.52%.
• The Russell 2000 (IWM), representing small caps, declined 0.33%, indicating some weakness in smaller stocks.

Sector Performance:

• Over the past week, Energy, Consumer Staples, and Consumer Discretionary sectors showed weakness.

• Industrials and Real Estate also underperformed.

• Technology, Communication Services, and Health Care led the market.

• Over three months, Real Estate and Health Care struggled, while Information Technology and Industrials performed well.

Market Breadth Indicators:

• Advancing vs. Declining stocks show mixed momentum.
• A higher percentage of stocks remain above key moving averages, indicating overall market strength.
• New highs outnumber new lows, confirming bullish momentum.

Key Takeaways

• Large caps (SPY, QQQ) remain strong, but small caps (IWM) are lagging.
• Technology continues to lead, while defensive sectors (Consumer Staples, Health Care) face pressure.
• Market breadth remains constructive, suggesting bullish conditions overall.