The year has started strongly for equity markets, with the first week of trading seeing funds establish ‘core’ positions. However, trading activity today was largely driven by a surge in energy stocks following political developments in Venezuela.
Key closing figures were as follows:
– S&P 500: +0.6%
– Nasdaq: +0.7%
– Dow Jones Industrial Average (DJIA): +1.2%
– Russell 2000: +1.6%
– Toronto TSX Composite: +1.1%
The Russell 2000 led gains, though it is important to note that the rally over Friday and today simply recovered losses incurred in the final week of 2025.
From the economic data front, the ISM manufacturing index was the main release. It showed a decline in manufacturing sentiment to the worst level since November 2024, alongside rising price pressures. Despite this negative combination, the report was largely overlooked by the market, with flows and sector movements driving trading instead.
Within the tech sector, some of the ‘Magnificent Seven’ stocks saw mixed performance; a few strengthened, while others, like Apple, fell by 1.4%.
Top performers of the day included:
– Valero (VLO): +9.05%
– Schlumberger (SLB): +8.91%
– Halliburton (HAL): +8.06%
– Coinbase Global (COIN): +8.03%
– Carvana (CVNA): +7.60%
– Phillips 66 (PSX): +7.02%
– Centene Corporation (CNC): +7.00%
– Robinhood Markets (HOOD): +6.78%
– Leidos (LDOS): +6.73%
– Interactive Brokers (IBKR): +6.39%
The strong performance of trading-related stocks such as Robinhood and Interactive Brokers is notable. There is a clear secular trend towards increased and extended hours trading, which benefits these companies.
On the downside, the laggards were:
– Jabil (JBL): –6.51%
– Comcast (CMCSA): –4.38%
– AbbVie (ABBV): –4.06%
– Campbell Soup (CPB): –3.77%
– Eli Lilly (LLY): –3.67%
– Omnicom Group (OMC): –3.65%
– Diamondback Energy (FANG): –3.52%
– APA Corporation (APA): –3.45%
– Devon Energy (DVN): –3.39%
– Domino’s (DPZ): –3.26%
Eli Lilly, a strong performer throughout 2025, saw clear profit-taking today. Comcast continues to struggle after a period of underperformance.
For forex traders, the key takeaway is to monitor energy stock movements closely due to the geopolitical impact from Venezuela, which is influencing market sentiment and flows. Additionally, despite disappointing manufacturing data, markets are focusing more on fund flows and sector rotation, indicating a need for careful attention to sectoral developments rather than solely relying on economic data.
Original Source: Adam Button of investinglive.com
