CNBC Daily Open: Stocks Snapped Their Losing Streak But It's Unclear If Their Gains Can Last

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This report is from today's CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Stocks snapped their losing streak. Analysts are divided on whether it's a false rally.

What you need to know today

  • Alibaba's earnings in its fiscal third quarter (which ran from October to December) smashed expectations; its year-on-year net income jumped 69%. The Chinese tech giant's U.S.-listed shares temporarily jumped on the news but finished the trading day slightly lower.
  • PRO Analysts cannot agree if we are still in a bear market, or if a new bull market underway — and there are reliable indicators backing each case. In this confusing market, it's best to stay open-minded, writes CNBC's Michael Santoli.

The bottom line

Markets snapped their losing streak. The Dow Jones Industrial Average gained 0.33%. The Nasdaq Composite, boosted by a huge 14.02% spike in Nvidia, rose 0.72%. The S&P 500 added 0.53%, ending the trading session at 4,012.32 points — dispelling fears, if only for now, that the index could remain below 4,000 points this year.

Even though stocks have staged a rebound, analysts warn that markets are not out of the woods yet. "The market has not priced in the risk of recession," said BankRate's Chief Financial Analyst Greg McBride. A note from Societe Generale was harsher, saying markets have entered a "Death Zone" — where there is little valuation support for the levels stocks are at now.

Not everyone is pessimistic about the state of the markets, however. Brendan Murphy, head of core fixed income, North America at Insight Investment, thinks the U.S. economy can avoid a recession while bringing inflation down to 2%. "We are now in a period of low growth and moderating inflation," said Murphy.

Newly released data seems to back him. On Thursday, fourth-quarter gross domestic product in the U.S. was revised down from 2.9% to 2.7% on an annualized basis — consumer spending wasn't as strong as initially estimated. While that means it's possible for markets to advance further this year, two pieces of data coming out Friday — January's personal consumption expenditures price index and personal income report — will test that idea.

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