Futures traded lower on Monday morning, after all significant indices closed with modest gains on Friday. Despite the positive close, the nine-week winning streak ended for all three as they started the year down. Analysts cited the strong jobs report as helping to tap the brakes on interest rate cut hopes, which some felt could come as early as March. Toss in some acceleration in wage growth, which the Federal Reserve has been trying to slow for almost two years, and the “higher-for-longer” mantra may remain in place until the summer.

Bonds

Treasury yields were higher across most of the curve, as they also responded to the surprisingly strong jobs report. The 10-year note climbed back over 4% to finish at 4.05%, while the shorter 2-year paper was last seen at 4.39%. While the inversion for the two remains in place, some across Wall Street feel the Fed’s rate hikes may not cause a recession.

Commodities

Brent and West Texas Intermediate crude both traded higher Friday to finish a solid week for both major benchmarks. Goldman Sachs warned that oil prices could double if continued attacks by Houthi Rebels in the Red Sea do not end. With significant shipping routes being disrupted and the potential for the Strait of Hormuz to be affected, traders bid prices higher, as Brent closed up 1.51% at $78.76, and WTI was last seen at $73.81, up 2.24%. Natural gas closed trading at $2.89, up 2.55%.

Gold also had a solid week, with the February contract closing Friday up modestly at $2,052.60, higher by 0.14%. Since the fall, the increasing geopolitical risk in the Middle East has kept a solid bid under the bullion. Bitcoin closed Friday at $43,908.40, down 0.63%, to end a wild week.

Here are the top Wall Street upgrades and downgrades for Monday, January 8, 2024.

Upgrades

Advanced Micro Devices Inc. (NASDAQ: AMD) from Hold to Buy with a price target of $165 at Melius.

American Airlines Group Inc. (NASDAQ: AAL) from Equal-Weight to Overweight with a price target of $20 at Morgan Stanley.

Dell Technologies Inc. (NYSE: DELL) from Neutral to Overweight, with a price target increase from $77 to $90, at J.P. Morgan.

Enphase Energy Inc. (NASDAQ: ENPH) from Equal Weight to Overweight at Wells Fargo, which increased its $98 price target to $141.

Freeport-McMoRan Inc. (NYSE: FCX) from Market Perform to Outperform, with the price target raised from $41 to $48.50, at Bernstein.

Downgrades

American Express Inc. (NYSE: AXP) from Neutral to Underperform with a price target of $190 at Robert W. Baird.

Barrick Gold Corp. (NYSE: GOLD) from Outperform to Market Perform at Bernstein, but no price target was given.

First Solar Inc. (NASDAQ: FSLR) from Overweight to Equal Weight, and the $215 price target cut to $187, at Wells Fargo.

Southwest Airlines Co. (NYSE: LUV) from Market Perform to Underperform with a price target of $24 at Bernstein.

Other Calls

Caterpillar Inc. (NYSE: CAT) initiated with an Equal-Weight rating and price target of $270 at Morgan Stanley.

Deere & Co. (NYSE: DE) initiated with an Overweight rating and price target of $430 at Morgan Stanley.

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