The futures were higher on Monday, after a wretched week for stocks that was capped off Friday by a big risk-off session in which all the major indexes closed lower for the day and the holiday-shortened trading week. Once again, the trigger for the selling was an inflation reading known as the personal consumption expenditures index, which came in hotter than expected. Analysts were looking for an increase of 4.9% year-over-year, and many were stunned when the 5.4% print hit the tape. This is one of the top metrics used by Federal Reserve Chair Powell for policy decisions, and it all but assures more rate increases are on the way.
Yields across the Treasury curve jumped higher again, and this was more fuel for the selling fire on Friday. Both the five-year and 10-year paper yields jumped double digits, as the latter note closes in on the 4% level. The 3.95% close for the 10-year when compared with the two-year close at 4.81% (a 12 basis-point jump) keeps the inversion between the two maturities at the widest level in 42 years, and it signals recession could be on the way.
Brent and West Texas Intermediate crude both ended the week higher, and some on Wall Street cited the increase of U.S. sanctions on Russia as a tailwind for the benchmarks. Natural gas also had a strong day, finishing over 8% higher at $2.50. The combination of warm weather in much of the world and oversupply has crushed pricing over the past few months. Gold and Bitcoin both once again finished the day lower. The cryptocurrency dropped 3% on the day to close at $23,217 last week, after having pressed over the $25,000 level last Tuesday.
24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top analyst upgrades, downgrades and initiations seen on Monday, February 27, 2023.
Barings BDC Inc. (NYSE: BBDC): Oppenheimer downgraded the stock to Perform from Outperform and trimmed its $10 target price to $9. The consensus target is $10.61, and shares closed on Friday at $8.64.
Block Inc. (NYSE: SQ): Evercore ISI raised its Underperform rating to In Line and boosted its $51 target price all the way to $80. The consensus target is even higher at $92.23. The stock closed up over 4% on Friday at $77.37 after revenues beat estimates.
Booking Holdings Inc. (NASDAQ: BKNG): UBS reiterated a Buy rating and lifted its $2,785 target price to $2,900. Goldman Sachs reiterated a Neutral rating, and its $2,250 target increased to $2,630. Barclays maintained an Overweight rating, and it raised its $2,550 price objective to $2585. The consensus target is $2,463.93. Friday’s closing share price was $2452.48.
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