Market Update
World Markets In Holding Pattern Ahead of Nvidia Earnings
Alexander Garcia
21 May, 2024
Miami
Market indexes entered the freezing zone as investors eagerly awaited the latest earnings from Nvidia, the leading artificial intelligence technology provider.
Stocks were in a holding pattern after investors digested the latest batch of earnings from retailers and tech companies, and advanced chipmakers traded volatile ahead of Nvidia's earnings.
Market indexes in early afternoon traded around flatline as investors digested a mixed batch of earnings from leading retailers including Macy's, Lowe's, and AutoZone.
Palo Alto Networks also dropped more than 5% after the cybersecurity company's guidance fell short of market expectations.
Investors have built expectations of rate cuts in the second half, but those expectations may have to be scaled back after policymakers signaled the need to keep rates higher.
On Tuesday, Fed Governor Christopher Wallace said he would prefer more encouraging data on the inflation front for several months before lowering rates.
"In the absence of a significant weakening in the labor market, I need to see several more months of good inflation data before I would be comfortable supporting an easing in the stance of monetary policy,” Wallace added.
U.S. Indexes and Treasury Yields
The S&P 500 index was nearly unchanged at 5,308.15, and the Nasdaq Composite declined 0.2% to 16,762.19.
The yield on 2-year Treasury notes edged higher to 4.84%, 10-year Treasury notes increased to 4.41%, and 30-year Treasury bonds edged higher to 4.54%.
Natural gas prices advanced in the previous four sessions in a row and hovered near this year's high on the expectation of rising demand from U.S. electric utilities.
WTI crude oil decreased $0.76 to $78.51 a barrel, and natural gas prices declined 6 cents to $2.69 a thermal unit.
Gold increased by $0.80 to $2,427.05 an ounce, and silver rose 15 cents to $31.91.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.54.
U.S. Stock Movers
Palo Alto Networks declined 4.8% to $308.21 after the cybersecurity company reported better-than-expected quarterly earnings, but the company's guidance for the current quarter fell short of market expectations.
Lowe's Companies decreased 1.8% to $225.04 after the home improvement retailer said comparable store sales declined 4.1% in the first quarter.
The retailer reported better-than-expected quarterly results.
Macy's Inc. gained 0.1% to $19.13 after the department store chain reported better-than-expected quarterly results.
The retailer also lifted its full-year outlook.
AutoZone declined 1.8% to $2,875.78 after the specialty retainer reported mixed results in the fiscal third quarter.
European Markets Struggle Near Record Highs Amid Rate Jitters
European markets turned lower, and benchmark indexes were under pressure in Tuesday's trading after rising in the previous session.
Market sentiment was weak after several policymakers urged caution and stressed that inflation is still too high and restrictive, and higher rates may be needed for a longer time to bring down inflation to 2%.
Moreover, policymakers in Europe also stressed the need to assess the incoming data before raising hopes for multiple rate cuts, as stated in June.
Eurozone Current Account Surplus Widens
The European Central Bank president, Christine Lagarde, raised hopes of a rate cut as early as June during a press conference after the last policy meeting on April 11.
On the economic front, the eurozone current account surplus improved in March after primary income improved in March, the European Central Bank reported Tuesday.
The current account surplus adjusted for seasonal factors rose to €36 billion in March from €29 billion in February, having surged from €13 billion a year ago.
Current account surplus, unadjusted for seasonal factors, rose to €44.5 billion from €27.0 billion a year ago.
The goods surplus increased to €41.5 billion from €39.6 billion, the services surplus rose to €3.9 billion from €1.8 billion and the primary income surplus surged to €12 billion from €1.2 billion.
Also, the secondary income gap narrowed to €12.9 billion from €15.6 billion.
German Producer Price Inflation Accelerates
Producer price inflation in Germany fell at a faster annual pace of 3.3% in April, faster than the 2.9% pace in March, Destatis reported Tuesday.
Producer prices declined for the tenth month in a row, driven by the steady decline in energy prices.
Europe Indexes and Yields
The DAX index decreased by 0.5% to 18,680.30; the CAC-40 index fell by 1.0% to 8,116.39; and the FTSE 100 index inched higher by 0.3% to 8,443.72.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.01%; the UK gilts edged higher to 4.15%; and Italian bonds inched higher to 3.81%.
The euro edged higher to $1.086; the British pound inched higher to $1.271; and the U.S. dollar gained to 90.93 Swiss cents.
Brent crude decreased $1.21 to $82.50 a barrel, and the Dutch TTF natural gas rose by €0.26 to €31.45 per MWh.
Europe Stock Movers
Kontron AG increased 3.1% to €20.48 after the German IoT company said it won a significant order to supply smart wallboxes.
Generali SpA decreased 2.6% to €23.21 after the company reported a slightly weaker profitability in its property and casualty unit.
Saipem SpA rose 3.2% to €2.36 after the energy contractor won three new orders worth $3.7 billion.
Greencore Group PLC soared 18.6% to 165.33 pence after the sandwich supplier to supermarkets announced its plans to buy back its own stock.
The company also said pre-tax profit in the first half soared to £14.7 million from a loss of £6.2 million a year ago.
Japan Indexes Erase Morning Gains
Stocks in Tokyo struggled to advance after erasing gains in the morning session ahead of key economic releases.
Benchmark indexes in Tokyo eased by 0.2% as investors awaited the release of consumer price inflation and international trade data.
Market sentiment turned cautious after the morning rally in tech stocks failed to broaden to the financial, industrial, and automobile sectors due to the persistent weakness in the yen.
The yen declined to 156.45 against the U.S. dollar in late afternoon trading in Tokyo on the worries that, despite tough talks from the ministry of finance and the Bank of Japan,.
Traders are targeting the yen to trade between 165 yen and 170 yen against the U.S. dollar, as the Bank of Japan is not in a hurry to increase its policy rate and the U.S. Federal Reserve is likely to keep its current rates in pace in the near future.
Japan Movers: Tokio Marine, MS&AD, T&D Holdings
The Nikkei 225 Stock Average decreased 0.2% to 39,014.70, and the Topix index fell 0.2% to 2,763.60.
Tech stocks cut early gains in the late afternoon as investors worried about the negative impact of the persistent decline in the yen.
Tokyo Electron, Advantest, Disco Corp., and Screen Holdings gained between 0.5% and 2.4%.
Sumitomo Mitsui gained 1.4%, Mitsubishi UFJ declined 0.9%, and Mizuho Financial dropped 2.4%.
Tokio Marine advanced 2.6% to ¥5,096.0 after the insurance company said it plans to buy back up to 200 billion yen worth of its own stock.
MS&AD Insurance soared 14.5% to ¥3,172.0 despite the company reporting fourth-quarter results that fell short of the company's estimates.
Net income in the March quarter was 87.67 billion yen, compared to a projection of 193.66 billion yen.
Revenue in the fiscal year 2024 rose 25.2% to 6.5 trillion from 5.2 trillion yen, net profit advanced to 369.2 billion yen from 211 billion yen, and diluted earnings per share rose to 231.77 yen from 130.50 yen.
The company increased its fourth-quarter dividend to 150 yen from 100 yen, and its total annual dividend rose to 270 yen from 200 yen a year ago.
Sompo Holdings, Daikin Industries, and T&D Holdings fell between 3% and 6%.
Hang Seng Index Drops 2%
Stocks in Shanghai and Hong Kong traded down after investors turned cautious.
Benchmark indexes in China have been on the upswing for the last two months after regulators, the central bank, and policymakers signaled support for market-supportive measures.
Stocks fell sharply after Li Auto, a leading electric vehicle maker, reported a sharp decline in earnings in its latest quarter, highlighting intense market pressures.
The People's Bank of China held steady its two reference rates on Monday and announced the setting up of a lending facility for regional governments to purchase existing homes.
Despite the flurry of announcements, investors are increasingly worried that stocks may have run too far from fundamentals, as corporate earnings may not pick pace in the near future and property market malaise is likely to drag on for years to come.
The Hang Seng index dropped the most in five weeks after weak earnings from Li Auto dragged down other electric vehicle makers.
China Movers: Intense EV Price War Drags Li Auto
The CSI 300 index fell 0.4% to 3,676.48, and the Hang Seng index declined 2.1% to 19,234.33.
Li Auto plunged 19% to HK$81.10 after the electric vehicle maker said net income in the first quarter declined 37% to 591.1 million yuan, or about $82 million, and revenue was 25.6 billion yuan.
The electric vehicle maker said it plans to deliver between 105,000 and 110,000 vehicles this quarter, representing an increase of between 21% and 27% from a year ago.
The company also estimated revenue in the quarter to range between 29.9 billion and 31.7 billion yuan, an increase between 4.2% and 9.7% from a year ago.
BYD declined 3.8% to HK$218.40, Geely Automobile decreased 3.6% to HK$10.26, and Xpeng tumbled 7.8% to HK$31.75.
Tech stocks were also among the leading decliners on the worry that valuations may have stretched too far from the sector's fundamentals.
Tencent Holdings decreased 3.4% to HK$383.60, JD.com fell 2.4% to HK$133.50, and Baidu fell 3.2% to HK$104.0.
U.S. Movers: AutoZone, Macy's, Lowe's, Palo Alto Networks
Scott Peters
21 May, 2024
New York City
Palo Alto Networks declined 4.8% to $308.21 after the cybersecurity company reported better-than-expected quarterly earnings, but the company's guidance for the current quarter fell short of market expectations.
Revenue in the fiscal third quarter ending in April rose 15% to $2.0 billion from $1.7 billion, net income soared to $278.8 million from $107.8 million, and diluted earnings per share advanced to 79 cents from 31 cents a year ago.
The company guided revenue in the fourth quarter to rise to between $2.15 billion and $2.17 billion, an increase between 9% and 11% from a year ago.
The company revised its annual revenue estimate to between $7.99 billion and $8.01 billion, an increase of 16% from a year ago.
Lowe's Companies decreased 1.8% to $225.04 after the home improvement retailer said comparable store sales declined 4.1% in the first quarter.
The retailer reported better-than-expected quarterly results.
Total sales in the first quarter declined to $21.4 billion from $22.3 billion, net income dropped to $1.8 billion from $2.26 billion, and diluted earnings per share declined to $3.06 from $3.77 a year ago.
Earnings in the quarter a year ago included gains from the sale of Canadian retail operations; after adjusting for the sale, earnings were $3.67 a share.
The retailer declared a dividend of $1.10, compared to $1.05 a year ago.
The company estimated annual sales between $84 billion and $85 billion, comparable sales to fall between 2% and 3%, and diluted earnings per share between $12.0 and $12.30.
Macy's Inc. gained 0.1% to $19.13 after the department store chain reported better-than-expected quarterly results.
Net sales in the first quarter declined 2.7% to $4.84 billion from $4.98 billion, net income dropped to $62 million from $155 million, and diluted earnings per share fell to 22 cents from 55 cents a year ago.
The retailer tightened its annual sales range to between $22.3 billion and $22.9 billion from the previous estimate of between $22.2 billion and $22.9 billion.
The company also lifted its adjusted diluted earnings per share range to between $2.55 and $2.90 from the $2.45 and $2.85 range released on February 27.
AutoZone declined 1.8% to $2,875.78 after the specialty retailer reported mixed results in the fiscal third quarter.
Revenue in the third quarter increased 3.5% to $4.2 billion from $4.1 billion, net income advanced to $651.7 million from $647.7 million, and diluted earnings per share increased to $36.69 from $34.12 a year ago.
Total comparable same-store sales rose 1.9%, driven by an 18.1% sales increase at international stores and flat sales at domestic stores.
The company repurchased 242,000 of its own shares at an average price per share of $3,036, for a total of $734.7 million. The company still had $1.4 billion available at the end of the fiscal third quarter.
U.S. Averages Hovered Near Record Highs; Retailers and Tech Stocks In Focus
Barry Adams
21 May, 2024
New York City
Benchmark indexes hovered near record highs, and tech stocks lacked direction ahead of the closely watched earnings report from Nvidia.
Market indexes traded around flatline as investors digested a mixed batch of earnings from leading retailers including Macy's, Lowe's, and AutoZone.
Palo Alto Networks also dropped more than 5% after the cybersecurity company's guidance fell short of market expectations.
Investors have built expectations of rate cuts in the second half, but those expectations may have to be scaled back after policymakers signaled the need to keep rates higher.
On Tuesday, Fed Governor Christopher Wallace said he would prefer more encouraging data on the inflation front for several months before lowering rates.
"In the absence of a significant weakening in the labor market, I need to see several more months of good inflation data before I would be comfortable supporting an easing in the stance of monetary policy,” Wallace added.
U.S. Indexes and Treasury Yields
The S&P 500 index was nearly unchanged at 5,308.15, and the Nasdaq Composite declined 0.2% to 16,762.19.
The yield on 2-year Treasury notes edged higher to 4.84%, 10-year Treasury notes increased to 4.41%, and 30-year Treasury bonds edged higher to 4.54%.
Natural gas prices advanced in the previous four sessions in a row and hovered near this year's high on the expectation of rising demand from U.S. electric utilities.
WTI crude oil decreased $0.76 to $78.51 a barrel, and natural gas prices declined 6 cents to $2.69 a thermal unit.
Gold increased by $0.80 to $2,427.05 an ounce, and silver rose 15 cents to $31.91.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.54.
U.S. Stock Movers
Palo Alto Networks declined 4.8% to $308.21 after the cybersecurity company reported better-than-expected quarterly earnings, but the company's guidance for the current quarter fell short of market expectations.
Lowe's Companies decreased 1.8% to $225.04 after the home improvement retailer said comparable store sales declined 4.1% in the first quarter.
The retailer reported better-than-expected quarterly results.
Macy's Inc. gained 0.1% to $19.13 after the department store chain reported better-than-expected quarterly results.
The retailer also lifted its full-year outlook.
AutoZone declined 1.8% to $2,875.78 after the specialty retainer reported mixed results in the fiscal third quarter.
Europe Movers: Greencore, Generali, Kontron, Saipem
Inga Muller
21 May, 2024
Frankfurt
European markets traded down after policymakers across Atlantic commented to scale down rate-cut expectations in the near future.
The DAX index decreased by 0.5% to 18,680.30; the CAC-40 index fell by 1.0% to 8,116.39; and the FTSE 100 index inched higher by 0.3% to 8,443.72.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.01%; the UK gilts edged higher to 4.15%; and Italian bonds inched higher to 3.81%.
Kontron AG increased 3.1% to €20.48 after the German IoT company said it won a significant order to supply smart wallboxes.
Generali SpA decreased 2.6% to €23.21 after the company reported a slightly weaker profitability in its property and casualty unit.
Saipem SpA rose 3.2% to €2.36 after the energy contractor won three new orders worth $3.7 billion.
Greencore Group PLC soared 18.6% to 165.33 pence after the sandwich supplier to supermarkets announced its plans to buy back £50 million of its own stock over the next 12 months starting with £30 million purchase.
Revenue declined 6.1% to 866.1 million from 925.8 million and comparable sales rose 4.1% from a year ago, respectively.
Revenue decline reflects the sale of low-margin business Trilby Trading.
Basic earnings per share rose to 2.5 pence from a loss of 0.9 pence a year ago.
The company also said pre-tax profit in the first half soared to £14.7 million from a loss of £6.2 million a year ago.
Eurozone Current Account Surplus Widens, German Producer Price Inflation Accelerates
Bridgette Randall
21 May, 2024
Frankfurt
European markets turned lower, and benchmark indexes were under pressure in Tuesday's trading after rising in the previous session.
Market sentiment was weak after several policymakers urged caution and stressed that inflation is still too high and restrictive, and higher rates may be needed for a longer time to bring down inflation to 2%.
Moreover, policymakers in Europe also stressed the need to assess the incoming data before raising hopes for multiple rate cuts, as stated in June.
The European Central Bank president, Christine Lagarde, raised hopes of a rate cut as early as June during a press conference after the last policy meeting on April 11.
On the economic front, the eurozone current account surplus improved in March after primary income improved in March, the European Central Bank reported Tuesday.
The current account surplus adjusted for seasonal factors rose to €36 billion in March from €29 billion in February, having surged from €13 billion a year ago.
Current account surplus, unadjusted for seasonal factors, rose to €44.5 billion from €27.0 billion a year ago.
The goods surplus increased to €41.5 billion from €39.6 billion, the services surplus rose to €3.9 billion from €1.8 billion and the primary income surplus surged to €12 billion from €1.2 billion.
Also, the secondary income gap narrowed to €12.9 billion from €15.6 billion.
Producer price inflation in Germany fell at a faster annual pace of 3.3% in April, faster than the 2.9% pace in March, Destatis reported Tuesday.
Producer prices declined for the tenth month in a row, driven by the steady decline in energy prices.
Europe Indexes and Yields
The DAX index decreased by 0.5% to 18,680.30; the CAC-40 index fell by 1.0% to 8,116.39; and the FTSE 100 index inched higher by 0.3% to 8,443.72.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.01%; the UK gilts edged higher to 4.15%; and Italian bonds inched higher to 3.81%.
The euro edged higher to $1.086; the British pound inched higher to $1.271; and the U.S. dollar gained to 90.93 Swiss cents.
Brent crude decreased $1.21 to $82.50 a barrel, and the Dutch TTF natural gas rose by €0.26 to €31.45 per MWh.
Europe Stock Movers
Kontron AG increased 3.1% to €20.48 after the German IoT company said it won a significant order to supply smart wallboxes.
Generali SpA decreased 2.6% to €23.21 after the company reported a slightly weaker profitability in its property and casualty unit.
Saipem SpA rose 3.2% to €2.36 after the energy contractor won three new orders worth $3.7 billion.
Greencore Group PLC soared 18.6% to 165.33 pence after the sandwich supplier to supermarkets announced its plans to buy back its own stock.
The company also said pre-tax profit in the first half soared to £14.7 million from a loss of £6.2 million a year ago.
Japan Indexes Erase Morning Gains; Tokio Marine and MS&AD Soar
Akira Ito
21 May, 2024
Tokyo
Stocks in Tokyo struggled to advance after erasing gains in the morning session ahead of key economic releases.
Benchmark indexes in Tokyo eased by 0.2% as investors awaited the release of consumer price inflation and international trade data.
Market sentiment turned cautious after the morning rally in tech stocks failed to broaden to the financial, industrial, and automobile sectors due to the persistent weakness in the yen.
The yen declined to 156.45 against the U.S. dollar in late afternoon trading in Tokyo on the worries that, despite tough talks from the ministry of finance and the Bank of Japan,.
Traders are targeting the yen to trade between 165 yen and 170 yen against the U.S. dollar, as the Bank of Japan is not in a hurry to increase its policy rate and the U.S. Federal Reserve is likely to keep its current rates in pace in the near future.
Japan Stock Movers
The Nikkei 225 Stock Average decreased 0.2% to 39,014.70, and the Topix index fell 0.2% to 2,763.60.
Tech stocks cut early gains in the late afternoon as investors worried about the negative impact of the persistent decline in the yen.
Tokyo Electron, Advantest, Disco Corp., and Screen Holdings gained between 0.5% and 2.4%.
Sumitomo Mitsui gained 1.4%, Mitsubishi UFJ declined 0.9%, and Mizuho Financial dropped 2.4%.
Tokio Marine advanced 2.6% to ¥5,096.0 after the insurance company said it plans to buy back up to 200 billion yen worth of its own stock.
MS&AD Insurance soared 14.5% to ¥3,172.0 despite the company reporting fourth-quarter results that fell short of the company's estimates.
Net income in the March quarter was 87.67 billion yen, compared to a projection of 193.66 billion yen.
Revenue in the fiscal year 2024 rose 25.2% to 6.5 trillion from 5.2 trillion yen, net profit advanced to 369.2 billion yen from 211 billion yen, and diluted earnings per share rose to 231.77 yen from 130.50 yen.
The company increased its fourth-quarter dividend to 150 yen from 100 yen, and its total annual dividend rose to 270 yen from 200 yen a year ago.
Sompo Holdings, Daikin Industries, and T&D Holdings fell between 3% and 6%.
Hang Seng Index Drops 2%; Intense EV Price War Drags Li Auto Earnings
Li Chen
21 May, 2024
Hong Kong
Stocks in Shanghai and Hong Kong traded down after investors turned cautious.
Benchmark indexes in China have been on the upswing for the last two months after regulators, the central bank, and policymakers signaled support for market-supportive measures.
Stocks fell sharply after Li Auto, a leading electric vehicle maker, reported a sharp decline in earnings in its latest quarter, highlighting intense market pressures.
The People's Bank of China held steady its two reference rates on Monday and announced the setting up of a lending facility for regional governments to purchase existing homes.
Despite the flurry of announcements, investors are increasingly worried that stocks may have run too far from fundamentals, as corporate earnings may not pick pace in the near future and property market malaise is likely to drag on for years to come.
The Hang Seng index dropped the most in five weeks after weak earnings from Li Auto dragged down other electric vehicle makers.
China Stock Movers
The CSI 300 index fell 0.4% to 3,676.48, and the Hang Seng index declined 2.1% to 19,234.33.
Li Auto plunged 19% to HK$81.10 after the electric vehicle maker said net income in the first quarter declined 37% to 591.1 million yuan, or about $82 million, and revenue was 25.6 billion yuan.
The electric vehicle maker said it plans to deliver between 105,000 and 110,000 vehicles this quarter, representing an increase of between 21% and 27% from a year ago.
The company also estimated revenue in the quarter to range between 29.9 billion and 31.7 billion yuan, an increase between 4.2% and 9.7% from a year ago.
BYD declined 3.8% to HK$218.40, Geely Automobile decreased 3.6% to HK$10.26, and Xpeng tumbled 7.8% to HK$31.75.
Tech stocks were also among the leading decliners on the worry that valuations may have stretched too far from the sector's fundamentals.
Tencent Holdings decreased 3.4% to HK$383.60, JD.com fell 2.4% to HK$133.50, and Baidu fell 3.2% to HK$104.0.
India Movers: India Cements, Oil India, Signatureglobal, Solara Active Pharma, Wheels India
Arun Goswami
21 May, 2024
Mumbai
Stocks in Mumbai opened lower amid Lok Sabha election jitters, global rate path uncertainties, and elevated energy prices.
Moreover, market sentiment was cautious after foreigners sold a net of ₹10,650 crore worth of stocks in the previous week, increasing the May total to ₹33,625 crore.
The Sensex index decreased by 0.2% to 73,894.04, and the Nifty index fell by 0.1% to 22,478.40.
On the Mumbai stock exchange, 153 stocks traded at their 52-week highs, and 19 stocks traded at their 52-week lows.
Solara Active Pharma Sciences increased 0.06% to ₹482.0 after the company's Visakhapatnam facility passed the initial onsite inspection by the U.S. Food and Drug Administration.
Signature Global India added 2.9% to ₹1,301.0 after the real estate development company agreed to acquire a 14.63-acre land parcel for ₹350 crore.
Wheels India rose 2.2% to ₹591.0 after the manufacturing company reported weak quarterly sales in the March quarter.
Consolidated revenue in the quarter increased 1.6% to ₹1,274.50 core from ₹1,254.57 crore, net income increased to ₹38.51 crore from ₹22.34 crore, and diluted earnings per share advanced to ₹15.76 from ₹9.14 a year ago.
India Cements gained 2.9% to ₹214.50 after the company reported a smaller loss in the March quarter.
Revenue in the quarter decreased 14.7% to ₹1,245.4 crore from ₹1,460.5 crore, and net loss shrank to ₹29.3 crore from ₹217.6 crore a year ago.
Oil India increased 1.4% to ₹647.0 despite the oil production, distribution, and marketing company reporting weak quarterly results.
Revenue in the March quarter decreased 4.9% to ₹9,147 crore from ₹9,614.3 crore, and net income dropped 10.5% to ₹2,333 crore from ₹2,607.7 crore a year ago.
Earnings and Optimism About AI Demand and Rate Cuts Drives Wall Street Indexes to New Highs
Alexander Garcia
20 May, 2024
Miami
Stocks on Wall Street advanced, and market indexes are set to close higher at the start of a new week after rallying in the previous four weeks in a row.
Investors continued to bid up artificial intelligence-linked stocks ahead of Nvidia's earnings later in the week after several analysts upgraded the stocks and raised the price target, suggesting as much as 30% upside.
In the week ahead, investors in the U.S. are looking forward to the release of the minutes of the latest policy meeting on Wednesday and updates on durable goods orders and the consumer sentiment index.
Moreover, investors are looking ahead to the release of earnings from Nvidia, Palo Alto Networks, Lowe’s, Analog Devices, Synopsis, Zoom Video Communications, Ralph Lauren, AutoZone, Target, and TJX.
U.S. Indexes and Treasury Yields
The S&P 500 index and the Nasdaq Composite inched further into record territory as optimism ruled market sentiment for the fifth week in a row.
Market sentiment has been driven by rate-cut expectations, corporate quarterly results meeting lowered expectations, and positive sentiment surrounding artificial intelligence technology development and application.
The S&P 500 index increased 0.3% to 5,319.87, and the Nasdaq Composite advanced 0.7% to 16,797.55.
The yield on 2-year Treasury notes edged higher to 4.84%, 10-year Treasury notes increased to 4.44%, and 30-year Treasury bonds edged higher to 4.58%.
Natural gas prices advanced for the fourth session in a row and reached this year's high on the expectation of rising demand from U.S. electric utilities.
WTI crude oil increased $0.12 to $80.81 a barrel, and natural gas prices increased 2 cents to $2.70 a thermal unit.
Gold increased by $6.11 to $2,420.49 an ounce, and silver rose 9 cents to $31.59.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.54.
U.S. Stock Movers
Nvidia soared 2.2% to $947.55 after the maker of ships for artificial intelligence activities was upgraded by several analysts ahead of the company's earnings release on Wednesday.
Johnson Controls International PLC jumped 2.5% to $70.78 after Bloomberg News reported that activist investment strategy-focused Elliott Investment Management has acquired a stake in the company worth more than $1 billion.
Palo Alto Networks declined 0.2% to $316.85 ahead of the company's quarterly results after the market closed later on Monday.
Resource Stocks Lead Gainers as European Markets Rebound
In Monday's trading, indexes in Europe advanced after falling in the previous week as investors debated the timing and amount of future rate cuts.
Benchmark indexes in Paris, London, and Frankfurt inched higher after resource stocks advanced in London, copper prices soared to a new record high, and crude oil prices turned volatile.
Crude oil prices edged slightly higher after Iran's state television confirmed the death of the president, Ebrahim Raisi, after the helicopter carrying the president, foreign minister, and a regional governor crashed while crossing mountainous climates, foggy weather, and icy conditions.
In other international news, the People's Bank of China held its one-year and 5-year loan prime rates steady, removed the floor on mortgage rates, and lowered down payment requirements for first-time home buyers.
Europe Indexes and Yields
The DAX index increased by 0.3% to 18,767.06; the CAC-40 index rose by 0.4% to 8,195.97; and the FTSE 100 index inched higher by 0.1% to 8,424.20.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.00%; the UK gilts edged higher to 4.13%; and Italian bonds inched higher to 3.81%.
The euro edged higher to $1.086; the British pound inched higher to $1.270; and the U.S. dollar gained to 90.88 Swiss cents.
Brent crude decreased $0.38 to $83.55 a barrel, and the Dutch TTF natural gas rose by €1.09 to €31.85 per MWh.
Europe Stock Movers
Keywords Studios PLC soared 62% to 2,382.90 pence after the Irish video game company said that it is in talks with European private equity company EQT Group for a possible cash offer of 2550 pence per share.
Ryanair Holdings plc declined 1.3% to €19.05 after the discount airline reported a 34% increase in its annual profits but offered cautious views for the current year.
British Land Company declined 0.8% to 400.0 pence after the real estate developer agreed to sell its stake in Meadowhall Shopping Center in Sheffield, UK, for £360 million to Norges Bank Investment Management.
Resource stocks advanced after China announced supportive measures to revive property market transactions.
Anglo American, Glencore, and Antofagasta advanced between 1% and 2% after copper futures rose to a record high of $5.15 per pound before stabilizing at $5.10.
Nikkei 225 In Tokyo Extends Rally to Fifth Week Ahead of Key Economic Releases
Benchmark indexes in Japan advanced tracking gains in Friday's trading on Wall Street.
Stocks edged higher in Tokyo in Monday's trading as investors reviewed the rise in energy and metals prices.
Brent crude oil prices jumped 6 cents to $84.0.2 a barrel after Iran's state-controlled television channel said that President Ebrahim Raisi's helicopter crashed while traveling to East Azerbaijan province and crossing mountainous terrain, foggy weather, and icy conditions.
Iran's foreign minister and governor of the province, along with bodyguards, are feared to have died in the helicopter crash.
Closer to home, investors are looking forward to a busy week of economic releases, including international trade, inflation, and business activity updates.
Japan Stock Movers
Benchmark indexes in Tokyo extended a 4-week rally powered by technology stocks and exporters.
The yen edged 14-sense higher 155.75 against the U.S. dollar on the worries of persistently wide interest rates between the U.S. and Japanese bonds.
The Nikkei 225 Stock Average added 1.1% to 39,211.83, and the Topix index gained 0.9% to 2,771.51.
Automakers were among the leading gainers in Monday's trading, and Tokyo Electron, Advantest, Socionext, and Screen Holdings advanced between 0.5% and 1.2%.
Banks were also among the most actively traded stocks.
Mitsubishi UFJ Financial Group added 0.6% to ¥1,563.50, Sumitomo Mitsui advanced 1.2% to ¥9,839.0, and Mizuho Financial gained 2.4% to ¥3,210.0.
Resource-linked stocks led the gainers in Tokyo trading after copper prices flirted near record highs.
Inpex, Mitsubishi Materials, and Sumitomo Metal Mining advanced between 3.5% and 5%.
Shin-Etsu Chemical gained 5.3% to ¥6,152.0 after the chemical company announced stock repurchase plans of 22 million shares not to exceed 100 billion yen before the end of November.
At the end of April, the company had 1.99 billion outstanding shares, excluding 5.61 million held in the Treasury.
Revenue in the financial year ending in March 2024 decreased 14% to 2.4 billion yen from 2.8 trillion yen, ordinary income dropped 22.8% to 787.2 billion yen from 1.02 trillion yen, and diluted earnings per share fell to 259.13 yen from 347.87 yen a year ago.
Sumiseki Holdings Inc. jumped 20.5% to ¥2,354.0, and the stock extended the previous week's gain of 93% after the coal mining company reported its financial results last week.
Revenue in the financial year 2024 declined 42% to 22.6 billion yen from 39.9 billion yen, ordinary net income soared 117% to 8.1 billion yen from 3.7 billion yen, and diluted earnings per share advanced to 124.94 yen from 59.33 yen a year ago.
PBOC Holds Loan Prime Rates, Announces Measures to Facilitate Residential Property Market
Market indexes in Shanghai and Hong Kong advanced and extended weekslong gains after the People's Bank of China announced measures to support the property market.
The People's Bank of China lowered the down payment requirement, removed the floor on mortgage rates, and provided 300 billion yuan to regional authorities to buy unsold existing homes.
China's central bank announced a total of 1 trillion yuan in additional financing for the property sector, which includes 300 billion yuan to support the regional government's move to expand affordable housing market activities.
The multi-prong move is likely to inject much-needed liquidity into the faltering property market, encourage buyers to acquire property, and support the regional governments' plans to provide more affordable housing.
Benchmark indexes edged higher in Shanghai and Hong Kong in Monday's trading and extended gains of 5-week and 4-week, respectively.
Economists and market watchers welcomed the central bank's supportive measures, but those steps are likely to fall short of reviving consumer confidence and repairing the balance sheets of troubled real estate companies.
In addition, on Monday, the People's Bank of China left its two key lending rates steady after announcing measures to revive the property market.
The one-year loan prime rate was held at 3.45%, and the five-year loan prime rate was held at 3.95%, meeting financial market expectations.
A five-year rate is used as a reference rate for setting the mortgage rate, and a one-year loan prime rate is the guiding rate for consumer and business loans.
China Stock Movers
The CSI 300 index added 0.2% to 3,685.63, and the Hang Seng index advanced 0.4% to 19,637.32.
Property stocks advanced for the second day in a row after the announcement of supportive measures from the People's Bank of China.
China Vanke soared 5.6% to HK$7.25, Longfor Group decreased 1.6% to HK$15.06, and China Resources Land edged up 0.5% to HK$32.90.
Henderson Land Development gained 3.2% to HK$27.30, and CK Asset Holdings advanced 1.6% to HK$36.35.
Bank of China added 1.6% to HK$3.92, Agriculture Bank of China was unchanged at HK$3.81, ICBC inched higher 0.2% to HK$4.72, and HSBC Holding added 0.6% to HK$68.95.
Tech stocks led the gainers in Hong Kong trading.
Tencent Holdings decreased 1.4% to HK$394.60, JD.com advanced 3.2% to HK$138.20, and Meituan Holdings added 0.3% to HK$125.90.
S&P 500 and Nasdaq Trade at New Intraday Record Highs, Artificial Intelligence Stocks In Focus
Barry Adams
20 May, 2024
New York City
Benchmark indexes on Wall Street lacked direction in Monday's trading, following an advance in the previous four weeks in a row.
Investors continued to bid up artificial intelligence-linked stocks ahead of Nvidia's earnings later in the week after several analysts upgraded the stocks and raised the price target, suggesting as much as 30% upside.
In the week ahead, investors in the U.S. are looking forward to the release of the minutes of the latest policy meeting on Wednesday and updates on durable goods orders and the consumer sentiment index.
On the earnings front, investors are looking ahead to the release of earnings from Nvidia, Palo Alto Networks, Lowe’s, Analog Devices, Synopsis, Ralph Lauren, AutoZone, Target, and TJX.
U.S. Indexes and Treasury Yields
The S&P 500 index and the Nasdaq Composite inched further into record territory, driven by rate-cut expectations, corporate quarterly results meeting lowered expectations, and positive sentiment surrounding artificial intelligence technology development and application.
The S&P 500 index increased 0.3% to 5,320.39, and the Nasdaq Composite advanced 0.6% to 16,793.58.
The yield on 2-year Treasury notes edged higher to 4.84%, 10-year Treasury notes increased to 4.44%, and 30-year Treasury bonds edged higher to 4.58%.
Natural gas prices advanced for the fourth session in a row and reached this year's high on the expectation of rising demand from U.S. electric utilities.
WTI crude oil increased $0.12 to $80.81 a barrel, and natural gas prices increased 2 cents to $2.70 a thermal unit.
Gold increased by $6.11 to $2,420.49 an ounce, and silver rose 9 cents to $31.59.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.54.
U.S. Stock Movers
Nvidia soared 2.2% to $947.55 after the maker of ships for artificial intelligence activities was upgraded by several analysts ahead of the company's earnings release on Wednesday.
Johnson Controls International PLC jumped 2.5% to $70.78 after Bloomberg News reported that activist investment strategy-focused Elliott Investment Management has acquired a stake in the company worth more than $1 billion.
Palo Alto Networks declined 0.2% to $316.85 ahead of the company's quarterly results after the market closed later on Monday.
Europe Movers: British Land Company, Keywords Studios, Resource Stocks, Ryanair
Inga Muller
20 May, 2024
Frankfurt
European markets traded higher in Monday's trading after falling in the previous week.
Market participants bid up stocks in hopes that the European Central Bank will initiate its rate cut as early as June, despite the rising pushback from policymakers.
The DAX index increased by 0.4% to 18,772.69; the CAC-40 index rose by 0.4% to 8,202.07; and the FTSE 100 index inched higher by 0.3% to 8,443.72.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.00%; the UK gilts edged higher to 4.13%; and Italian bonds inched higher to 3.81%.
Keywords Studios PLC soared 62% to 2,382.90 pence after the Irish video game company said that it is in talks with European private equity company EQT Group for a possible cash offer of 2550 pence per share.
Ryanair Holdings plc declined 1.3% to €19.05 after the discount airline reported a 34% increase in its annual profits but offered cautious views for the current year.
British Land Company declined 0.8% to 400.0 pence after the real estate developer agreed to sell its stake in Meadowhall Shopping Center in Sheffield, UK, for £360 million to Norges Bank Investment Management.
Resource stocks advanced after China announced supportive measures to revive property market transactions.
Anglo American, Glencore, and Antofagasta advanced between 1% and 2% after copper futures rose to a record high of $5.15 per pound before stabilizing at $5.10.
Resource Stocks Lead Gainers as European Markets Rebound
Bridgette Randall
20 May, 2024
Frankfurt
In Monday's trading, indexes in Europe advanced after falling in the previous week as investors debated the timing and amount of future rate cuts.
Benchmark indexes in Paris, London, and Frankfurt inched higher after resource stocks advanced in London, copper prices soared to a new record high, and crude oil prices turned volatile.
Crude oil prices edged slightly higher after Iran's state television confirmed the death of the president, Ebrahim Raisi, after the helicopter carrying the president, foreign minister, and a regional governor crashed while crossing mountainous climates, foggy weather, and icy conditions.
In other international news, the People's Bank of China held its one-year and 5-year loan prime rates steady, removed the floor on mortgage rates, and lowered down payment requirements for first-time home buyers.
Europe Indexes and Yields
The DAX index increased by 0.4% to 18,772.69; the CAC-40 index rose by 0.4% to 8,202.07; and the FTSE 100 index inched higher by 0.3% to 8,443.72.
The yield on 10-year German bonds edged up to 2.51%; French bonds inched higher to 3.00%; the UK gilts edged higher to 4.13%; and Italian bonds inched higher to 3.81%.
The euro edged higher to $1.086; the British pound inched higher to $1.270; and the U.S. dollar gained to 90.88 Swiss cents.
Brent crude decreased $0.22 to $83.75 a barrel, and the Dutch TTF natural gas rose by €1.13 to €31.90 per MWh.
Europe Stock Movers
Keywords Studios PLC soared 62% to 2,382.90 pence after the Irish video game company said that it is in talks with European private equity company EQT Group for a possible cash offer of 2550 pence per share.
Ryanair Holdings plc declined 1.3% to €19.05 after the discount airline reported a 34% increase in its annual profits but offered cautious views for the current year.
British Land Company declined 0.8% to 400.0 pence after the real estate developer agreed to sell its stake in Meadowhall Shopping Center in Sheffield, UK, for £360 million to Norges Bank Investment Management.
Resource stocks advanced after China announced supportive measures to revive property market transactions.
Anglo American, Glencore, and Antofagasta advanced between 1% and 2% after copper futures rose to a record high of $5.15 per pound before stabilizing at $5.10.
Nikkei 225 In Tokyo Extends Rally to Fifth Week Ahead of Key Economic Releases
Akira Ito
20 May, 2024
Tokyo
Benchmark indexes in Japan advanced tracking gains in Friday's trading on Wall Street.
Stocks edged higher in Tokyo in Monday's trading as investors reviewed the rise in energy and metals prices.
Brent crude oil prices jumped 6 cents to $84.0.2 a barrel after Iran's state-controlled television channel said that President Ebrahim Raisi's helicopter crashed while traveling to East Azerbaijan province and crossing mountainous terrain, foggy weather, and icy conditions.
Iran's foreign minister and governor of the province, along with bodyguards, are feared to have died in the helicopter crash.
Closer to home, investors are looking forward to a busy week of economic releases, including international trade, inflation, and business activity updates.
Japan Stock Movers
Benchmark indexes in Tokyo extended a 4-week rally powered by technology stocks and exporters.
The yen edged 14-sense higher 155.75 against the U.S. dollar on the worries of persistently wide interest rates between the U.S. and Japanese bonds.
The Nikkei 225 Stock Average added 1.1% to 39,211.83, and the Topix index gained 0.9% to 2,771.51.
Automakers were among the leading gainers in Monday's trading, and Tokyo Electron, Advantest, Socionext, and Screen Holdings advanced between 0.5% and 1.2%.
Banks were also among the most actively traded stocks.
Mitsubishi UFJ Financial Group added 0.6% to ¥1,563.50, Sumitomo Mitsui advanced 1.2% to ¥9,839.0, and Mizuho Financial gained 2.4% to ¥3,210.0.
Resource-linked stocks led the gainers in Tokyo trading after copper prices flirted near record highs.
Inpex, Mitsubishi Materials, and Sumitomo Metal Mining advanced between 3.5% and 5%.
Shin-Etsu Chemical gained 5.3% to ¥6,152.0 after the chemical company announced stock repurchase plans of 22 million shares not to exceed 100 billion yen before the end of November.
At the end of April, the company had 1.99 billion outstanding shares, excluding 5.61 million held in the Treasury.
Revenue in the financial year ending in March 2024 decreased 14% to 2.4 billion yen from 2.8 trillion yen, ordinary income dropped 22.8% to 787.2 billion yen from 1.02 trillion yen, and diluted earnings per share fell to 259.13 yen from 347.87 yen a year ago.
Sumiseki Holdings Inc. jumped 20.5% to ¥2,354.0, and the stock extended the previous week's gain of 93% after the coal mining company reported its financial results last week.
Revenue in the financial year 2024 declined 42% to 22.6 billion yen from 39.9 billion yen, ordinary net income soared 117% to 8.1 billion yen from 3.7 billion yen, and diluted earnings per share advanced to 124.94 yen from 59.33 yen a year ago.