Market Update
Earnings In Focus After Fed's Decision to Hold Rates Steady
Barry Adams
02 May, 2024
New York City
Benchmark indexes on Wall Street edged higher after investors shifted their attention to corporate quarterly results and key economic data releases.
The S&P 500 index and the Nasdaq Composite turned higher in early trading as investors reviewed the latest comments from Federal Reserve Chair Jerome Powell.
The U.S. Federal Reserve held steady in its policy rate range between 5.25% and 5.50%, as widely anticipated by most market participants.
The Federal Reserve also noted that inflation is still too high but added that it is unlikely that the next policy move will be a rate increase.
Fed Chairman Jerome Powell said that the central bank is prepared to keep rates high as long as needed until it gains greater confidence that inflation is on the path of its target rate of 2%.
The Federal Reserve also announced its plans to slow down its quantitative tightening starting June 1. The move is likely to contribute to lowering interest rates and ease the liquidity crunch in the financial system.
The central bank plans to reduce its monthly sale of Treasury securities to $25 billion from the current target of up to $60 billion beginning June 1st.
The Federal Reserve is holding about $7.4 trillion of Treasury securities on its balance sheet, and the Fed has been shrinking its balance sheet after it expanded to $9 trillion at the start of 2022 from pre-pandemic $4 trillion.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.6% to 5,046.63, and the Nasdaq Composite rose 0.7% to 15,672,89.
The yield on 2-year Treasury notes edged higher to 4.95%, 10-year Treasury notes inched lower to 4.61%, and 30-year Treasury bonds edged lower to 4.75%.
WTI crude oil increased $0.72 to $79.72 a barrel, and natural gas prices increased 4 cents to $1.97 a thermal unit.
Gold increased by $23.02 to $2,109.15 an ounce, and silver fell 47 cents to $26.21.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.70.
U.S. Stock Movers
DoorDash plunged 9.9% to $114.80 after the food delivery company reported a wider-than-expected loss in its latest quarter.
Carvana soared 35% to $118.0 after the automotive retailer reported higher-than-expected revenue in the first quarter.
eBay Inc. declined 3.8% to $49.11 after the online marketplace operator estimated weaker-than-expected revenue in the current quarter.
Qualcomm increased 5.2% to $172.78 after the advanced chipmaker reported better-than-expected earnings in its latest quarter and issued strong guidance for the current quarter.
Moderna rose 1.9% to $113.67 after the vaccine maker reported a smaller-than-expected quarterly loss in its latest quarter after the company trimmed operating costs.
Wayfair Inc. advanced 7.5% to $54.31 after the online furniture retailer reported a narrower loss in its latest quarter, partly driven by layoffs.
Peloton Interactive increased 13% to $3.61 after the company announced its plans to lay off 15% of its staff, and chief executive officer Barry McCarthy will be stepping down.
McCarthy will act as a strategic adviser to the company through the end of the year, and chairperson Karen Boone and director Chris Bruzzo will assume the roles of interim co-CEO.
U.S. Movers: Carvana, DoorDash, eBay, Moderna, Peloton, Qualcomm, Wayfair
Scott Peters
02 May, 2024
New York City
DoorDash plunged 9.9% to $114.80 after the food delivery company reported a wider-than-expected loss in its latest quarter.
Revenue increased 23% to $2.5 billion from $2.05 billion, net loss attributable to shareholders shrank to $25 million from $161 million, and diluted loss per share fell to 6 cents from 41 cents a year ago.
In the first quarter, total orders increased by 21% to 620 million, and gross sales volume rose by 21% to $19.2 billion, driven in part by a more than 100% increase in the new vertical, grocery delivery.
Free cash flow increased to $487 million from $316 million, and operating cash flow rose to $553 million from $397 million a year ago.
Carvana soared 35% to $118.0 after the automotive retailer reported higher-than-expected revenue in the first quarter.
Net sales in the first quarter rose to $3.06 billion from $2.60 billion, net income attributable to shareholders swung to a profit of $28 million from a loss of $160 million, and diluted earnings per share were 23 cents from a loss of $1.51 a year ago.
Vehicles sold in the first quarter rose 16% from a year ago to 91,878, and gross profit jumped to 19.3%.
Gross per unit in the first quarter jumped to $6,802 from $6,432 a year ago.
eBay Inc. declined 3.8% to $49.11 after the online marketplace operator estimated weaker-than-expected revenue in the current quarter.
Revenue in the first quarter increased 2% to $2.55 billion from $2.51 billion, net income declined 23% to $439 million from $569 million, and diluted earnings per share dropped to 85 cents from $1.05 a year ago.
The company estimated second-quarter revenue in the range of $2.49 billion and $2.54 billion, an increase between -1% and +1%.
The online marketplace operator estimated second-quarter diluted earnings per share between 76 cents and 81 cents.
Qualcomm increased 5.2% to $172.78 after the advanced chipmaker reported better-than-expected earnings in its latest quarter and issued strong guidance for the current quarter.
Revenue in the fiscal second quarter ending on March 24 rose 1% to $9.38 billion, net income surged 37% to $2.3 billion from $1.7 billion, and diluted earnings per share advanced 36% to $2.06 from $152 a year ago.
During the fiscal second quarter, the company returned $1.6 billion to stockholders, including cash dividends of $895 million, or 80 cents per share, and $731 million through repurchases of 5 million shares of its own common stock.
The company guided fiscal third quarter revenue to range between $8.8 billion and $9.6 billion and GAAP earnings per share between $1.74 and $1.94.
Moderna rose 1.9% to $113.67 after the vaccine maker reported a smaller-than-expected quarterly loss in its latest quarter after the company trimmed operating costs.
Wayfair Inc. advanced 7.5% to $54.31 after the online furniture retailer reported a narrower loss in its latest quarter, partly driven by layoffs.
Total net revenue in the first quarter declined 1.6% to $2.72 billion from $2.77 billion, net loss shrank to $248 million from $355 million, and diluted loss per share eased to $2.06 from $3.22 a year ago.
Active customers in the first quarter increased by 2.8% from a year ago to 22.3 million.
The company processed 9.6 million orders in the quarter, a decline of 1%, and repeat customers placed 7.7 million, an increase of 1.3% from a year ago, respectively.
The average order value in the first quarter decreased to $285 from $287 in the corresponding period a year ago.
Peloton Interactive increased 13% to $3.61 after the company announced its plans to lay off 15% of its staff, and chief executive officer Barry McCarthy will be stepping down.
McCarthy will act as a strategic adviser to the company through the end of the year, and chairperson Karen Boone and director Chris Bruzzo will assume the roles of interim co-CEO.
Europe Movers: Hugo Boss, Novo Nordisk, Teleperformance, Smurfit Kappa, Shell, Standard Chartered, Vestas
Inga Muller
02 May, 2024
Frankfurt
European markets lacked direction amid interest rate uncertainties and ongoing weakness in the manufacturing sector.
The DAX index decreased by 0.1% to 17,912.18; the CAC-40 index fell by 0.9% to 7,909.23; and the FTSE 100 index inched higher by 0.4% to 8,150.63.
The yield on 10-year German bonds edged up to 2.55%; French bonds inched lower to 3.04%; the UK gilts edged lower to 4.31%; and Italian bonds inched higher to 3.87%.
Shell PLC gained 1% to 2,847.51 pence after the oil giant reported better-than-expected first-quarter earnings and announced a $3.5 billion stock repurchase plan, which is expected to be completed in the second quarter.
Revenue in the first quarter decreased to $74.7 billion from $89.02 billion, net income dropped to $11.0 billion from $14.3 billion, and diluted earnings per share fell to $1.13 from $1.25.
The company announced a first-quarter cash dividend of 34.4 cents per share and added that it returned to shareholders $5 billion through repurchases of $2.8 billion and a cash dividend of $2.2 billion.
Standard Chartered increased 5.4% to 732.60 pence after the financial services provider reported stronger-than-expected first-quarter profit amid elevated interest rates and higher demand for its wealth management services.
Smurfit Kappa Group advanced 4.5% to 3,638.0 pence after the packaging material maker reported first-quarter revenue of €2.7 billion.
Hugo Boss declined 9.4% to €45.77 after the German fashion retailer reported better-than-expected first-quarter earnings and projected revenue growth in the current year.
The fashion group said revenue in the first quarter increased 5% to €1.01 billion from €968 million, driven by sales increases in both BOSS and HUGO brands, across all channels, and across all regions.
Net income in the quarter increased 7% to €41 million from €38 million, and earnings per share rose to 55 cents from 50 cents a year ago, respectively.
The company reiterated its full-year revenue between €4.30 billion and €4.45 billion, representing growth between 3% and 6%.
The fashion house estimated operating earnings to range between €430 million and €475 million, an increase between 5% and 15% from a year ago.
Teleperformance increased 8.2% to €92.50 after the French business service provider said first-quarter revenue rose 26.7%, driven largely by the integration of the Dutch rival Majorel last year.
Novo Nordisk decreased 2.5% to DKK 875.60 despite the Danish pharmaceutical company reporting better-than-expected first-quarter earnings.
Vestas Wind System declined 3.2% to DKK 180.85 after the Danish wind turbine maker reported a surprise loss in the first quarter.
Revenue in the first quarter declined 5.2% to €2.68 billion from €2.82 billion, and net income in the period swung to a loss of €75 million from a profit of €16 million a year ago.
The company reiterated its full-year revenue outlook between €16 billion and €18 billion and its operating income margin before special items between 4% and 6%.
Rate Anxieties Keep European Markets Volatile, Manufacturing Sector Woes Deepened In April
Bridgette Randall
02 May, 2024
Frankfurt
European markets traded sideways as investors debated future interest rate paths and the manufacturing sector outlook.
Benchmark indexes in Frankfurt and Paris edged lower after the U.S. Federal Reserve held steady its benchmark interest rate range between 5.25% and 5.50%.
Investors debated the spillover effect of the higher-for-longer U.S. interest rates on the currency union's rate path.
The European Central Bank has signaled that it is ready to cut its interest rates as early as June, but the central bank has not clarified the size of or the number of subsequent cuts in the year.
Market sentiment was further dented after an ongoing downturn in the manufacturing sector deepened in April.
HCOB Eurozone Manufacturing PMI declined to 45.7 in April from 46.1 in March, S&P Global reported in its final reading on Thursday.
Any reading below the 50-mark indicates contraction, and any reading above the 50-mark shows expansion.
Market indexes in London traded higher after strong earnings from Standard & Chartered and Shell PLC lifted market sentiment.
Europe Indexes and Yields
The DAX index decreased by 0.1% to 17,912.18; the CAC-40 index fell by 0.9% to 7,909.23; and the FTSE 100 index inched higher by 0.4% to 8,150.63.
The yield on 10-year German bonds edged up to 2.55%; French bonds inched lower to 3.04%; the UK gilts edged lower to 4.31%; and Italian bonds inched higher to 3.87%.
The euro edged higher to $1.069; the British pound inched higher to $1.251; and the U.S. dollar edged higher to 91.25 Swiss cents.
Brent crude increased $0.65 to $84.09 a barrel, and the Dutch TTF natural gas fell by €1.25 to €30.11 per MWh.
Europe Stock Movers
Shell PLC gained 1% to 2,847.51 pence after the oil giant reported better-than-expected first-quarter earnings and announced a $3.5 billion stock repurchase plan.
Standard Chartered increased 5.4% to 732.60 pence after the financial services provider reported stronger-than-expected first-quarter profit amid elevated interest rates and higher demand for its wealth management services.
Smurfit Kappa Group advanced 4.5% to 3,638.0 pence after the packaging material maker reported first-quarter revenue of €2.7 billion.
Hugo Boss declined 9.4% to €45.77 after the German fashion retailer reported better-than-expected first-quarter earnings and projected revenue growth in the current year.
Teleperformance increased 8.2% to €92.50 after the French business service provider said first-quarter revenue rose 26.7%, driven largely by the integration of the Dutch rival Majorel last year.
Novo Nordisk decreased 2.5% to DKK 875.60 despite the Danish pharmaceutical company reporting better-than-expected first-quarter earnings.
Vestas Wind System declined 3.2% to DKK 180.85 after the Danish wind turbine maker reported a surprise loss in the first quarter.
Tokyo Indexes Struggle After Tech Stock Weakness, Sumitomo Pharma Plunges 7%
Akira Ito
02 May, 2024
Tokyo
Stocks in Tokyo declined, and the yen rebounded for the second day in a row, amid tech stock weakness and the possible intervention by the central bank.
The Nikkei and the Topix indexes lacked direction in Thursday's trading after the U.S. Federal Reserve held rates steady but signaled that the future rate path is highly uncertain.
Fed Chair Jerome Powell also ruled out the possibility of a rate hike in the immediate future and confirmed that inflation has moderated over the last year, but progress has stalled in recent months.
Powell added that the central bank is prepared to keep rates high as long as needed until it gains greater confidence that inflation is on the path of its target rate of 2%.
Closer to home, the minutes of the Bank of Japan's policy meeting held on March 18 and 19 showed Thursday that policymakers believe the central bank's inflation target of 2% is within reach.
Moreover, the monetary base increased 2.1% from a year ago in April to 689.896 trillion yen, and the adjusted monetary base soared 11.4% from a year ago. the Bank of Japan said Thursday.
The Japanese yen rebounded for the second day in a row to 155.70, stoking speculation that the Bank of Japan, in coordination with the ministry of finance, intervened for the second day in a row.
Tech stocks in the U.S. sold on the worry that higher rates are likely to stay elevated amid positive U.S. economic data and resilient labor market conditions.
The Nikkei 225 Stock Average decreased 0.07% to 38,245.08, and the Topix index declined a fraction to 2,729.17.
Tech stocks in Japan followed the weakness in New York.
Tokyo Electron, Advantest, Socionext, SoftBank, and Screen Holdings decreased between 0.3% and 1.8%.
Financial stocks were also among the leading decliners after the U.S. rate decision announcement.
Sumitomo Mitsui Group declined 1.2% to ¥8,881.0, Mitsubishi UFJ fell 0.5% to ¥1,557.50, and Mizuho Financial Group eased 0.3% to ¥3,010.0.
Sumitomo Pharma dropped 7% to ¥373.0 after the company reported lower-than-estimated revenue and higher-than-estimated losses in the fiscal year 2024 ending in March.
Revenue was revised lower to 314.6 billion yen from the previous estimate of 317 billion yen, and net loss attributable to shareholders was revised higher to 315 billion yen from the previous estimate of 147 billion yen.
The loss per share was revised to 792.86 yen from the previous estimate of 354.90 yen.
The company also suspended its dividend after the sharp decline in core profit.
India Movers: Eicher Motor, Godrej Group, Hero MotoCorp, Jindal Stainless, Maruti Suzuki, Tata Motors
Arun Goswami
02 May, 2024
Mumbai
Stocks in Mumbai traded down after investors returned from a holiday and digested the latest updates on GST collections and core industry output.
Core industry output rose at a slower pace of 5.2% in March, after rising at an annual pace of 7.1% in the previous month, but faster than the 4.2% pace in the month a year ago, the ministry of commerce and industry announced in a report on Wednesday.
GST collections in April rose 12.4% to a record high of 2.10 lakh crore, the ministry of finance reported Wednesday.
The Sensex index decreased by 0.23% to 74,078.82, and the Nifty index fell by 0.2% to 22,530.06.
On the Mumbai stock exchange, 119 stocks traded at their 52-week highs, and 6 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched higher to 7.20%, and the Indian rupee edged lower at ₹83.43 against the U.S. dollar.
Godrej Group companies were in focus after the family reached an agreement to split the conglomerate.
Brothers Adi and Nadir Godrej will own publicly listed companies, while cousin Jamshyd Godrej will own a land portfolio and privately held companies.
Hero MotoCorp increased 2.2% to ₹4,551.0 after the company said two-wheeler vehicle sales in April increased 34.7% from a year ago to 533,585 units.
Eicher Motors increased 1% to ₹4,615.50 after the company said domestic truck and bus sales increased 20% and international sales rose 38.5%.
Maruti Suzuki advanced 0.9% to ₹12,800.0 after the passenger car maker said vehicle sales in April were unchanged from a year ago at 168,000.
Tata Motors increased 0.7% to ₹1,008.0 after the company said total global vehicle sales in April increased 31% from a year ago to 77,521 units from 69,599.
Global commercial vehicle sales increased by 31% to 29,538 units, and passenger car sales rose by 2% to 47,983 units from a year ago, respectively.
Jindal Stainless rose 1% to ₹707.0, and the company announced its plans to invest 5,400 crore to meet its expansion plans.
Hong Kong Stocks Jump, EV Makers Report Mixed Sales In April Amid Brutal Price War
Li Chen
02 May, 2024
Hong Kong
Stocks in Hong Kong advanced after investors returned from a holiday, and financial markets in China are closed for the week.
Optimism ruled Hong Kong trading after the U.S. Federal Reserve held steady its benchmark rate, driving financial and insurance stocks higher.
The Hong Kong Monetary Authority held its reference rate steady at 5.75%, following the move by the U.S. Federal Reserve, under its linked exchange rate system reflecting the Hong Kong dollar's peg to the U.S. dollar.
The interest rate move supported the rise in financial and insurance stocks, and HSBC, Ping An, and AIA rose between 0.9% and 3.5%.
Property developers rose after the interest rate decision announcement, and U.S. Federal Reserve Chair Jerome Powell ruled out rate hikes in the near future.
Longfor Group added 7.3% to HK$12.72, China Vanke soared 10.5% to $5.10, and China Resources Land jumped 4.5% to HK$29.65.
Henderson Land increased 1.4% to HK$24.20, and Sun Hung Kai Properties jumped 2.4% to HK$74.05.
The Hang Seng index rose 2.2% to 18,150.91, and the Hang Seng Tech index jumped 3.5%.
Tech leaders also participated in the market rally, and Tencent Holdings, Meituan, Baidu, and Alibaba Group jumped between 2% and 9%.
Electric vehicle makers were in focus after the three leading makers reported mixed sales in April amid a brutal price war as the automakers struggled to gain market share amid slowing domestic demand growth.
Li Auto jumped 2.2% to HK$106.30 after the electric vehicle maker said April sales decreased 0.4% from the previous month to 25,787 units.
Sales in the first four months to April 2024 advanced 35.6% from a year ago to 106,187 units.
Xpeng soared 7.4% to HK$33.90 after the company said electric vehicle sales in April rose 4% from the previous month to 9,393 units.
Year-to-date sales rose 23% to 31,214 vehicles.
The company is engaged in a brutal price war amid fierce competition in the mid-price segment for cars priced between 200,000 and 300,000 yuan.
BYD jumped 4.3% to HK$225.60 after the largest electric vehicle maker in China said sales in April rose 3.6% to 313,245 units.
Year-to-date sales surged 49% to 210,295 units.
Nio soared 21.4% to HK$43.40 after the electric vehicle maker said April sales soared 31.6% from the previous month to 15,620 units, the largest monthly increase among the four leading automakers.
Sales in the first four months of April rose 21% from a year ago to 45,673 units.
Will the Fed Abandon the 2% Target Rate?
Alexander Garcia
01 May, 2024
Miami
Benchmark indexes on Wall Street retained a downward bias as investors await the Fed's rate decision.
The S&P 500 index and the Nasdaq Composite declined 0.2% ahead of the Federal Reserve's rate decisions and comments on the appropriate level of interest rates.
At the start of the year, the Fed had raised expectations of as many as four rate cuts in the year and suggested that while the economy is strong, there has been considerable progress in curbing inflationary pressures.
However, as the year progressed, those expectations of rate cuts were dashed after inflation stalled near 3%, primarily because of the elevated inflation in the service sector.
The Federal Reserve has raised interest rates eleven times between March 2022 and July 2023, lifting rates from zero to 5.5%.
But as inflation began to ease from the 40-year high peak of 9.1% in June 2022 and hovered above 3% in the second half of 2023 and first quarter of 2024, investors expectations rose that the Fed may have flexibility in decreasing rates as early as June.
However, progress in bringing down inflation to a 2% annual rate has stalled in the last six months, amid a resilient economy and moderating but tight labor market conditions.
The Fed's own projection on inflation at the beginning of the year also stoked speculation that policymakers are laying the groundwork for rate cuts in the second half.
The latest updates on inflation indicators, nonfarm payrolls, GDP growth, retail sales, and durable goods orders suggested that rates are not restrictive enough and wages are rising at rates not commensurate with the Fed's inflation target rate of 2%.
Job Openings Dropped to a 3-year Low
Job openings in March declined by 325,000 and dropped to the lowest level since February 2021, signaling moderating labor market conditions.
Job postings fell 0.2 percentage points to 5.1% of all workers, according to the Job Openings and Labor Turnover Survey released Wednesday.
Openings declined by 1.1 million from a year ago, as openings in construction fell by 182,000, declined in finance and insurance by 158,000, but increased in state and local government education by 68,000.
Over the month, both hiring and separations changed little, indicating labor market conditions are still tight but moderating.
In March, hirings declined by 455,000 to 5.5 million, while the total number of separations decreased by 339,000 to 5.2 million.
Taking into account the regional distribution, job openings in the West fell by 194,000, in the Midwest by 112,000, in the South by 41,000, but rose in the Northeast by 22,000.
U.S. Indexes and Treasury Yields
The S&P 500 index decreased 0.2% to 5,022.73, and the Nasdaq Composite fell 0.3% to 15,610,50.
The yield on 2-year Treasury notes edged higher to 5.04%, 10-year Treasury notes inched higher to 4.68%, and 30-year Treasury bonds edged lower to 4.78%.
WTI crude oil decreased $2.10 to $79.57 a barrel, and natural gas prices decreased 6 cents to $1.92 a thermal unit.
Gold increased by $16.52 to $2,307.93 an ounce, and silver rose 18 cents to $26.53.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 106.17.
U.S. Stock Movers
Starbucks Corp. dropped 13% to $77.0 after the coffee chain operator reported weaker-than-expected revenue and earnings in the first quarter.
Pinterest soared 16.6% to $39.03 after the social media company reported better-than-expected revenue and earnings in the first quarter.
Super Micro Computer dropped 14% to $738.50 after the company announced lower-than-expected third-quarter revenue of $3.85 billion and higher-than-expected adjusted earnings per share of $6.65.
Amazon.com rose 1.6% to $177.85 after the online retailer and cloud services provider reported better-than-expected revenue and earnings in the first quarter after advertising revenue soared 24%.
The company said revenue in the current quarter is expected to range between $144 billion and $149 billion, representing an increase between 7% and 11%.
The Amazon Web Services business soared 17% to $25 billion, calming the worries that the division's growth had topped out following slower growth last year.
AMD fell 6.8% to $147.70 after the advanced chipmaker reiterated its full-year outlook, dampening expectations of sales and earnings revisions.
FTSE 100 Index Trades Higher, European Markets Closed for May Day Holiday
The benchmark index in London edged slightly higher as financial markets in Continental Europe were closed for the May Day holiday.
The FTSE 100 index opened higher and bond yields held firm in thin trading as most traders were away in Zurich, Paris, Milan, and Frankfurt.
In April, benchmark indexes in London rose about 2.5%, but the DAX CAC-40 indexes dropped about 2% as investors adjusted rate-cut expectations and reacted to local corporate earnings.
In the absence of local and regional economic news, investors awaited the release of the U.S. Fed's monetary policy announcements later in the day after the close.
Fed policymakers are widely expected to hold the interest rate range between 5.25% and 5.50%, and investors are awaiting the Fed's direction on the level of interest rates.
Investors had bid up stocks in the first quarter in the hopes that policymakers were ready to begin rate cuts as early as June, followed by as many as three additional cuts later in the year.
However, those expectations have been lowered after several economic reports suggested that the U.S. economy and labor market conditions are more resilient than previously expected.
Moreover, several inflation indicators have stayed above the expectations set by economists, with service inflation staying above 3%, indicating that policymakers may await cooler inflation before lowering rates.
The lowered rate cut expectations had a direct and negative effect on investor sentiment, driving the U.S. benchmark indexes lower by more than 4% in April.
Europe Indexes and Yields
Financial markets in Frankfurt and Paris were close for the May Day holiday, and the FTSE 100 index in London inched lower by 0.3% to 8,120.97.
The yield on 10-year German bonds edged up to 2.58%; French bonds inched higher to 3.07%; the UK gilts edged higher to 4.38%; and Italian bonds inched lower to 3.87%.
The euro edged higher to $1.066; the British pound inched higher to $1.249; and the U.S. dollar edged higher to 92.06 Swiss cents.
Brent crude decreased $1.97 to $83.99 a barrel, and the Dutch TTF natural gas fell by €0.69 to €28.70 per MWh.
Europe Stock Movers
Aston Martin Lagonda Global declined 4.6% to 141.43 pence after the luxury automaker reported a wider-than-expected loss in the first quarter.
Revenue in the first quarter declined by 26% to £945 million from £1.3 billion; pre-tax losses expanded to £138.8 million from £74.2 million; and net debt increased by 20% to £1.04 billion from £868.1 million a year ago.
The company said vehicle sales declined in the quarter after it introduced new products, ended production of several core products, and ramped up production of the new Vantage, upgraded DBX 707, and V12 sports car.
Vehicle sales in the first quarter dropped 26% to 945 from 1,269 units in the corresponding period a year ago.
Next plc increased 0.1% to 9,020.49 pence after the apparel retailer reiterated its full-year outlook.
Revenue in the first quarter increased 5.7% from a year ago, driven by an 8.8% rise in online sales and flat in-store sales.
The retailer projected a full-year 2024 consolidated sales increase of 6% to £6.2 billion, a pre-tax profit rise of 4.6% to £960 million, and an after-tax earnings per share gain of 4.8% to 606.3 pence.
GSK plc increased 2.2% to 1,706.75 pence after the pharmaceutical company reported a better-than-expected 27% increase in its core operating profit in the first quarter.
Revenue in the first quarter increased 10% to 7.4 billion, core operating profit soared 27% to 2.4 billion, and earnings per share declined 19% to 25.7 pence.
The company announced a 15-pence per share cash dividend.
The pharmaceutical company's full-year sales are likely towards the upper end of its previously announced sales growth range of between 5% and 7%, with core operating profit rising between 9% and 11% and core earnings per share rising between 8% and 10%.
Domino's Pizza Group PLC decreased 0.7% to 323.40 pence after the company reported weaker-than-expected quarterly results.
Comparable sales in the first quarter declined by 0.5%, and total orders fell by 0.8% from the previous year, but on a two-year basis, comparable sales rose by 8.4%.
Total system sales in the first quarter declined 0.4% to £385.1 million from £386.6 million, and total orders on a comparable basis fell 0.8% to 17.7 million from 17.8 million a year ago.
Total orders fell 1.8% to 17.7 million from 18.0 million.
Japan's Manufacturing Contraction Extends to Eleventh Month
Stocks in Tokyo traded lower in thin trading and erased some of the gains in the previous two sessions as investors remained cautious amid the flood of earnings.
Market indexes fell in a broad selloff that saw technology and financial stocks leading the decliners following sharp declines in overnight trading in New York.
Market indexes fell nearly 1% on Wall Street after a measure of wages and benefits rose at the fastest pace in one year at 1.2%, supporting the case for the Federal Reserve to wait longer before lowering interest rates.
The expectations of fewer and delayed U.S. rate cuts soured market sentiment in New York, overhanging Tokyo trading.
Japan's manufacturing sector continued to contract for the eleventh month in a row, but at a slower pace in April, S&P Global reported in its final update.
The au Jibun Japan Manufacturing PMI eased to 49.6 in April from 49.9 in the preliminary estimate and a final 48.2 in March.
Manufacturing activities contracted at a slower pace in April as output and new orders shrank at a slower pace in the month.
However, business sentiment was unchanged from March, driven in part by improving demand, the report noted.
The Nikkei 225 Stock Average declined 0.2% to 38,356.20, and the Topix index dropped 0.3% to 2,733.96.
Tokyo Electron, Advantest, Screen Holdings, and SoftBank fell between 1.5% and 3.5%.
Toyota Motor, Honda Motor, and Nissan Motor declined between 0.4% and 1.1%.
Financial stocks were among the leading decliners, and Mitsubishi UFJ, Mizuho Financial, and Sumitomo Mitsui Financial Group decreased between 0.2% and 1.4%.
Rising travel demand lifted the revenue of three Japanese railway companies, driven by the ending of the travel restrictions imposed during COVID-19 and the return of international tourists.
East Japan Railway consolidated revenue in the year ending in March rose 13.5% to 2,730 billion yen, and West Japan Railway revenue rose 17.2% to 1,635 billion yen.
Central Japan Railway revenue surged 22.1% to 1,710 billion yen.
West Japan Railway increased 8% to ¥3,233.0; East Japan Railway added 3.3% to ¥2,987.50; and Central Japan Railway declined 0.1% to ¥3,614.0.
Lasertec Reports Strong Quarterly Results and Announces Executive Changes
Lasertec Corporation soared 15.8% to ¥40,080.0 after the company reported higher-than-expected sales and earnings in the nine-month period ending in March.
Consolidated nine-month revenue increased 97.9% to 157.2 billion yen from 79.4 billion yen, ordinary income soared 109.8% to 58.7 billion yen, and diluted earnings per share rose to 460.02 yen compared to 229.53 a year ago.
The company estimated sales in the fiscal year ending in June 2024 to increase by 27.6% to 195 billion yen, ordinary income to increase by 5.2% to 67 billion yen, and diluted earnings per share to be 543.32 yen.
The company reiterated its plans to pay a total cash dividend of 191 yen, higher than 180 yen a year ago.
The company also promoted its chief sales officer, Tetsuya Sendoda, as the new chief executive officer and the current CEO, Osamu Okabayashi, as the new chairman.
Job Openings Dropped to a 3-year Low In April
Brian Turner
01 May, 2024
Washington, D.C.
Job openings in March declined by 325,000 and dropped to the lowest level since February 2021, signaling moderating labor market conditions.
Job postings fell 0.2 percentage points to 5.1% of all workers, according to the Job Openings and Labor Turnover Survey released Wednesday.
Openings declined by 1.1 million from a year ago, as openings in construction fell by 182,000, declined in finance and insurance by 158,000, but increased in state and local government education by 68,000.
Over the month, both hiring and separations changed little, indicating labor market conditions are still tight but rapidly easily after openings peaked at 12.2 million in March 2022.
In March, hirings declined by 455,000 to 5.5 million, while the total number of separations decreased by 339,000 to 5.2 million.
Taking into account the regional distribution, job openings in the West fell by 194,000, in the Midwest by 112,000, in the South by 41,000, but rose in the Northeast by 22,000.
Stocks On Wall Street Turn Lower Ahead of Fed's Rate Decisions
Barry Adams
01 May, 2024
New York City
With all eyes on the Federal Reserve, benchmark indexes in early trading edged lower and extended the previous session's losses.
The S&P 500 index and the Nasdaq Composite declined 0.2% ahead of the Federal Reserve's rate decisions and comments on the level of interest rates.
At the start of the year, the Fed had raised expectations of as many as four rate cuts in the year and suggested that while the economy is strong, there has been considerable progress in curbing inflationary pressures.
However, as the year progressed, those expectations of rate cuts were dashed after inflation stalled near 3%, primarily because of the elevated inflation in the service sector.
The Federal Reserve has raised interest rates eleven times between March 2022 and July 2023, lifting rates from zero to 5.5%.
But as inflation began to ease from the 40-year high peak of 9.1% in June 2022 and hovered above 3% in the second half of 2023 and first quarter of 2024, investors expectations rose that the Fed may have flexibility in decreasing rates as early as June.
However, progress in bringing down inflation to a 2% annual rate has stalled in the last six months, amid a resilient economy and moderating but tight labor market conditions.
The Fed's own projection on inflation at the beginning of the year also stoked speculation that policymakers are laying the groundwork for rate cuts in the second half.
The latest updates on inflation indicators, nonfarm payrolls, GDP growth, retail sales, and durable goods orders suggested that rates are not restrictive enough and wages are rising at rates not commensurate with the Fed's inflation target rate of 2%.
U.S. Indexes and Treasury Yields
The S&P 500 index decreased 0.1% to 5,015.04, and the Nasdaq Composite fell 0.3% to 15,582,72.
The yield on 2-year Treasury notes edged higher to 5.04%, 10-year Treasury notes inched higher to 4.68%, and 30-year Treasury bonds edged lower to 4.78%.
WTI crude oil decreased $1.48 to $80.45 a barrel, and natural gas prices decreased 5 cents to $1.93 a thermal unit.
Gold increased by $3.36 to $2,294.30 an ounce, and silver rose 11 cents to $26.48.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 106.29.
U.S. Stock Movers
Starbucks Corp. dropped 13% to $77.0 after the coffee chain operator reported weaker-than-expected revenue and earnings in the first quarter.
Pinterest soared 16.6% to $39.03 after the social media company reported better-than-expected revenue and earnings in the first quarter.
Super Micro Computer dropped 14% to $738.50 after the company announced lower-than-expected third-quarter revenue of $3.85 billion and higher-than-expected adjusted earnings per share of $6.65.
Amazon.com rose 1.6% to $177.85 after the online retailer and cloud services provider reported better-than-expected revenue and earnings in the first quarter after advertising revenue soared 24%.
The company said revenue in the current quarter is expected to range between $144 billion and $149 billion, representing an increase between 7% and 11%.
The Amazon Web Services business soared 17% to $25 billion, calming the worries that the division's growth had topped out following slower growth last year.
AMD fell 6.8% to $147.70 after the advanced chipmaker reiterated its full-year outlook, dampening expectations of sales and earnings revisions.