Market Update
U.S. Rally Resumes After Investors Overcome Rate Jitters for Now
Barry Adams
14 Feb, 2024
New York City
Stocks on Wall Street rebounded, and investors focused on high growth tech companies and returned to add more positions.
Investors reassessed the previous day's losses, and market indexes attempted a rebound in Wednesday's trading.
The S&P 500 index and the Nasdaq Composite advanced after investors surmised that a market selloff in the previous session, the deepest since March 2023, may not be warranted.
The hotter-than-expected consumer price inflation in January most likely pushed the rate cut later in the year, undercutting the base argument for the recent rally in the last five weeks.
However, investors shifted their focus to positive earnings, receding inflation, and stable interest rates.
Investors are looking forward to the release of the producer price inflation report later in the week.
On the earnings front, Cisco, Generac, Kraft Heinz, Zillow, Airbnb, Robinhood Markets, Lyft, Instacart, and AutoNation were in focus.
U.S. indexes and yields
The S&P 500 index increased 0.4% to 4,971.38, and the Nasdaq Composite rose 0.4% to 15,723.63.
The yield on 2-year Treasury notes advanced to 4.63%, 10-year Treasury notes increased to 4.30%, and 30-year Treasury bonds edged up to 4.46%.
WTI crude oil decreased $0.12 to $77.76 a barrel, and natural gas prices declined 6 cents to $1.62 a thermal unit, a low last seen in September 2020.
Gold increased by $2.40 to $1,989.23 an ounce after the U.S. dollar gained in international trading.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.74.
U.S. Stock Movers
Airbnb declined 6.2% to $141.43 despite the online booking platform reporting better-than-expected quarterly results.
Revenue in the quarter surged after the company attracted more first-time customers and expanded beyond its core markets in Europe, South America, and Asia.
Gross booking value in the quarter increased 15% to $15.5 billion, and nights and experiences booked 12% to 98.8 million in the fourth quarter.
Revenue in the fourth quarter rose 17% to $2.2 billion, net income swung to a loss of $349 million from a profit of $319 million, and diluted earnings per share were a loss of 55 cents compared to a profit of 48 cents a year ago.
Active listings at the end of the fourth quarter increased by 1.2 million to 7 million around the world.
Gross booking value in 2023 soared 16% from a year ago to $73.3 billion, and nights and experiences booked jumped 14% to 448.2 million.
Lyft Inc. soared 20% to $14.56 after the ridesharing company reported fourth-quarter results.
Revenue in the quarter increased to $1.22 billion from $1.18 billion, and net losses shrank to $26.3 million from $588.1 million.
Gross bookings on the platform rose to $3.7 billion from $3.2 billion. Active riders increased 10% to 22.4 million from 20.4 million, and rides surged to 190.8 million from 151.1 million a year ago.
The company estimated gross booking in the first quarter between $3.5 billion and $3.6 billion and adjusted operating earnings between $50 million and $55 million.
European Markets Turned Higher Tracking Wall Street Gains
European markets closed higher in Wednesday's trading, a day after a sharp selloff following the release of the U.S. inflation report.
World markets traded down after U.S. inflation in January eased less than expected to an annual pace of 3.1% and core inflation stayed at 3.9%, supporting the case for the Federal Reserve to wait a longer before lowering interest rates.
In Wednesday's trading, benchmark indexes in Paris, London, and Frankfurt advanced, and investors reacted to domestic corporate results.
In Europe, benchmark indexes traded near record highs after investors dialed back on rate-cut optimism.
The number of employed persons in the Euro Area increased by 0.3% from the previous quarter in the final quarter of 2023 to 169.3 million.
Employment increased by 1.3% from a year ago in the fourth quarter of 2023.
Employment in the eurozone expanded for the eleventh quarter in a row, giving more leeway to the European Central Bank to keep interest rates at restrictive levels while bringing down inflation.
UK Inflation Held Steady In January
Closer to home, the UK consumer price inflation rate held steady at 4.0%, the Office for National Statistics reported on Wednesday.
Core inflation, which excludes food and energy prices, was also unchanged at 5.1%.
On a monthly basis, inflation declined by 0.6%, after rising by 0.4% in December.
Dutch GDP Expands In the Final Quarter of 2023
The Netherlands GDP grew by 0.3% from the previous quarter in the final quarter of 2023, Statistics Netherlands reported Wednesday.
The Dutch economy expanded in the final quarter following the contraction in the previous three quarters in a row, after consumer spending rose 1.8% and government spending advanced 0.4%.
International trade did not make any contribution to the GDP after exports and imports rose 0.3%.
The Dutch GDP shrank by 0.5% from a year ago after contracting by 0.8% in the third quarter.
Europe Indexes and Yields
The DAX index increased 0.4% to 16,950.23, the CAC-40 index rose 0.7% to 7,676.22, and the FTSE 100 index inched higher by 0.7% to 7,562.22.
The yield on 10-year German bonds edged up to 2.36%; French bonds inched higher to 2.85%; the UK gilts edged higher to 4.07%; and Italian bonds inched higher to 3.90%.
The euro edged lower to $1.070, the British pound inched higher to $1.255, and the U.S. dollar gained to 88.79 Swiss cents.
Brent crude decreased $0.01 to $82.75 a barrel, and the Dutch TTF natural gas fell by €0.74 to €24.70 per MWh.
Europe Stock Movers
Banks across Europe declined after rate-cut hopes waned in the eurozone.
Societe Generale, BNP Paribas, UniCredit, and Commerzbank edged lower.
ABN Amro Bank increased 4.2% to €14.02 after the Dutch lender's quarterly earnings were ahead of market expectations.
ThyssenKrupp declined 8.5% to €5.05 after the German steelmaker lowered its full-year profit and sales outlook, citing weakening demand.
The company also took on impairment charges in its fiscal first quarter.
Schindler Holding increased 2% to CHF 212.80 after the Swiss elevator company estimated revenue growth of "low single-digit" in 2024.
Bilfinger SE soared 10.1% to €42.16 after the company won a large maintenance order from INEOS for the Forties Pipeline System.
Delivery Hero jumped 5.5% to €19.74 after the German food delivery company said its organic cash flow is sufficient to cover its bond and debt maturities.
Heineken NV dropped 5% to €88.48 after the alcoholic beverage maker issued a cautious outlook for 2024, citing uncertainty in global geopolitical and economic conditions.
Capgemini advanced 4.5% to €215.50 after the French IT consulting group reported solid results in 2023 despite the weak macroeconomic environment.
Dunelm Group decreased 0.7% to 1,078.0 pence after the UK-based home goods retailer reported strong results in the interim period for 26 weeks ending on December 30.
The company signaled that margin growth is likely to slow down in the coming months.
Coca-Cola HBC gained 5.7% to 2,332.0 pence after the Hellenic bottling company reported a record annual profit in 2023 and the company lifted its dividend.
Asian Markets Under Pressure After U.S. Inflation Report
Across Asia, market indexes declined in Japan, Korea, and Indonesia, and financial markets remained closed in China.
Overall inflation fell to an annual pace of 3.1% in January, and core inflation, which excludes food and energy prices, stayed at 3.9%, significantly higher than the Federal Reserve's target rate of 2%.
Hotter-than-expected inflation in January supported the case for the Federal Reserve to wait for a while before lowering inflation, denting the critical assumption behind the market rally over the last three months.
Higher inflation suggests that the U.S. dollar is likely to advance and stock market indexes are likely to face downward pressures in the days ahead.
Japan Stocks Faced Selling Pressure
The Nikkei 225 average fell, tracking losses in overnight trading on Wall Street following the release of hotter-than-expected U.S. inflation in January.
The Nikkei 225 decreased 0.7% to 37,702.85 and eased from the 34-year high reached in the previous session.
The yen weakened to 150.25 against the U.S. dollar after U.S. rate-cut hopes were pushed back following the inflation report.
Exporters were among the leading decliners, and tech companies led the gainers.
Toyota Motor, Sony Group, Panasonic, Canon, Japan Tobacco, and Nippon Steel declined between 2% and 3%.
Advantest, Screen Holdings, Tokyo Electron, and Renesas Electronics gained between 0.5% and 1.0%.
Citizen Watch soared 5.9% to ¥1,049.0 after the company reported better-than-expected quarterly results. Sales in the fiscal third quarter rose 4.2% to 859 billion yen, and net income attributable to shareholders increased 2% to 73 billion yen.
Seiko Group advanced 0.5% to ¥2,738.0, following Citizen's results.
Sapporo Holding soared 7.7% to ¥7,406.0, and Idemitsu Kosan added 2.6% to ¥852.60 after the energy exploration company reported better-than-expected earnings.
Hang Seng Index Erased Morning Losses
The Hang Seng index advanced 0.3% to 15,797.59, and the benchmark index erased a 1.2% decline in the morning session after investors returned from a long weekend to celebrate the Lunar New Year.
Financial markets in mainland China and Taiwan are closed for the rest of the week.
Property developers continued on the downward path due to the ongoing worries of weak demand and a lack of specific stimulus from policymakers.
Longfor, China Resources Land, China Vanke, and Sun Hung Kai Properties declined between 1% and 3%.
New World Development, Budweiser Brewing, and Xinyi Glass declined around 1% after MSCI included these three companies in the list of 66 Chinese companies scheduled to be removed from its global standard index at the end of this month.
India Indexes Erase Morning Losses
Stocks in Mumbai and Asia faced selling pressure after U.S. inflation was higher than expected in January.
The Sensex and the Nifty indexes dropped about 0.5% in early trading and dragged down tech service providers and banks after the release of the U.S. inflation report.
The Sensex index gained 0.4% to 71,822.83, and the Nifty index rose 0.5% to 21,840.05.
Adani Group stocks were in focus after the U.S.-based rating agency Moody's Investor Service revised its outlook on four group companies to "stable" from "negative."
The ratings agency had lowered its outlook on Adani Green, Adani Electricity Mumbai, Adani Transmission, and Adani Energy Solutions after the U.S.-based short seller launched a media attack a year ago.
U.S. Major Averages Rebound After Investors Look Beyond Rate Uncertainty
Barry Adams
14 Feb, 2024
New York City
Investors reassessed the previous day's losses, and market indexes attempted a mild rebound in Wednesday's trading.
The S&P 500 index and the Nasdaq Composite advanced 0.5% in early trading after investors worried that a market selloff in the previous session may not be warranted.
The hotter-than-expected consumer price inflation in January most likely pushed the rate cut later in the year, undercutting the base argument for the recent rally in the last five weeks.
However, investors shifted their focus to positive earnings, receding inflation, and stable interest rates.
Investors are looking forward to the release of the producer price inflation report later in the week.
On the earnings front, Cisco, Generac, Kraft Heinz, Zillow, Airbnb, Robinhood Markets, Lyft, Instacart, and AutoNation were in focus.
In Europe, benchmark indexes traded near record highs after investors dialed back on rate-cut optimism.
The number of employed persons in the Euro Area increased by 0.3% from the previous quarter in the final quarter of 2023 to 169.3 million.
Employment increased by 1.3% from a year ago in the fourth quarter of 2023.
Employment in the eurozone expanded for the eleventh quarter in a row, giving more leeway to the European Central Bank to keep interest rates at restrictive levels while bringing down inflation.
Across Asia, the Nikkei index edged lower after flirting with a new 34-year high in the previous session, and property sector stocks continued to lead decliners in Hong Kong after investors returned from Lunar New Year holidays.
U.S. indexes and yields
The S&P 500 index increased 0.2% to 4,993.21, and the Nasdaq Composite fell 0.6% to 15,754.07.
The yield on 2-year Treasury notes advanced to 4.63%, 10-year Treasury notes increased to 4.30%, and 30-year Treasury bonds edged up to 4.46%.
WTI crude oil increased $0.22 to $78.09 a barrel, and natural gas prices declined 2 cents to $1.68 a thermal unit, a low last seen in September 2020.
Gold increased by $1.73 to $1,990.46 an ounce after the U.S. dollar gained in international trading.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.90.
U.S. Stock Movers
Airbnb declined 6.2% to $141.43 despite the online booking platform reporting better-than-expected quarterly results.
Revenue in the quarter surged after the company attracted more first-time customers and expanded beyond its core markets in Europe, South America, and Asia.
Gross booking value in the quarter increased 15% to $15.5 billion, and nights and experiences booked 12% to 98.8 million in the fourth quarter.
Revenue in the fourth quarter rose 17% to $2.2 billion, net income swung to a loss of $349 million from a profit of $319 million, and diluted earnings per share were a loss of 55 cents compared to a profit of 48 cents a year ago.
Active listings at the end of the fourth quarter increased by 1.2 million to 7 million around the world.
Gross booking value in 2023 soared 16% from a year ago to $73.3 billion, and nights and experiences booked jumped 14% to 448.2 million.
Instacart decreased 3.5% to $27.0 despite the food delivery company reporting positive quarterly results.
Revenue in the fourth quarter rose to $803 million from $757 million, net income rose to $135 million from $109 million, and diluted earnings per share dropped to 44 cents from $1.11 a year ago.
Gross transaction volume jumped 7% to $7.9 billion, and orders increased 5% to 70.1 million.
Transaction revenue increased 6% to $560 million, and advertising and other revenue rose 7% to $243 million.
The company estimated first-quarter 2024 gross transaction volume to increase between $8 billion and $8.2 billion, an increase between 7% and 10%.
Lyft Inc. soared 20% to $14.56 after the ridesharing company reported fourth-quarter results.
Revenue in the quarter increased to $1.22 billion from $1.18 billion, and net losses shrank to $26.3 million from $588.1 million.
Gross bookings on the platform rose to $3.7 billion from $3.2 billion. Active riders increased 10% to 22.4 million from 20.4 million, and rides surged to 190.8 million from 151.1 million a year ago.
The company estimated gross booking in the first quarter between $3.5 billion and $3.6 billion and adjusted operating earnings between $50 million and $55 million.
Robinhood Markets surged 12.5% to $13.33 after the online trading platform operator reported better-than-expected quarterly results.
Revenue in the fourth quarter increased 24% to $471 million from $380 million, net income swung to a profit of $30 million from a loss of $166 million, and diluted earnings per share were 3 cents compared to a loss of 19 cents a year ago.
Net interest revenue increased 41% to $236 million, and net transaction-based revenue rose 8% to $200 million.
Assets under custody increased 65% to $102.6 billion, reflecting net new deposits of $4.6 billion totaling $17.1 billion and higher equity valuations.
Average revenue per user in the quarter increased by 23% to $81.
U.S. Movers: Airbnb, Instacart, Lyft, Robinhood Markets
Scott Peters
14 Feb, 2024
New York City
Airbnb declined 6.2% to $141.43 despite the online booking platform reporting better-than-expected quarterly results.
Revenue in the quarter surged after the company attracted more first-time customers and expanded beyond its core markets in Europe, South America, and Asia.
Gross booking value in the quarter increased 15% to $15.5 billion, and nights and experiences booked 12% to 98.8 million in the fourth quarter.
Revenue in the fourth quarter rose 17% to $2.2 billion, net income swung to a loss of $349 million from a profit of $319 million, and diluted earnings per share were a loss of 55 cents compared to a profit of 48 cents a year ago.
Active listings at the end of the fourth quarter increased by 1.2 million to 7 million around the world.
Gross booking value in 2023 soared 16% from a year ago to $73.3 billion, and nights and experiences booked jumped 14% to 448.2 million.
Instacart decreased 3.5% to $27.0 despite the food delivery company reporting positive quarterly results.
Revenue in the fourth quarter rose to $803 million from $757 million, net income rose to $135 million from $109 million, and diluted earnings per share dropped to 44 cents from $1.11 a year ago.
Gross transaction volume jumped 7% to $7.9 billion, and orders increased 5% to 70.1 million.
Transaction revenue increased 6% to $560 million, and advertising and other revenue rose 7% to $243 million.
The company estimated first-quarter 2024 gross transaction volume to increase between $8 billion and $8.2 billion, an increase between 7% and 10%.
Lyft Inc. soared 20% to $14.56 after the ridesharing company reported fourth-quarter results.
Revenue in the quarter increased to $1.22 billion from $1.18 billion, and net losses shrank to $26.3 million from $588.1 million.
Gross bookings on the platform rose to $3.7 billion from $3.2 billion. Active riders increased 10% to 22.4 million from 20.4 million, and rides surged to 190.8 million from 151.1 million a year ago.
The company estimated gross booking in the first quarter between $3.5 billion and $3.6 billion and adjusted operating earnings between $50 million and $55 million.
Robinhood Markets surged 12.5% to $13.33 after the online trading platform operator reported better-than-expected quarterly results.
Revenue in the fourth quarter increased 24% to $471 million from $380 million, net income swung to a profit of $30 million from a loss of $166 million, and diluted earnings per share were 3 cents compared to a loss of 19 cents a year ago.
Net interest revenue increased 41% to $236 million, and net transaction-based revenue rose 8% to $200 million.
Assets under custody increased 65% to $102.6 billion, reflecting net new deposits of $4.6 billion totaling $17.1 billion and higher equity valuations.
Average revenue per user in the quarter increased by 23% to $81.
Europe Movers: ABN Amro, Bilfinger, Capgemini, Coca-Cola HBC, Delivery Hero, Dunelm, Heineken, Schindler, ThyssenKrupp
Inga Muller
14 Feb, 2024
Frankfurt
European markets advanced in cautious trading a day after indexes fell sharply after the latest inflation report in the U.S. poured cold water on rate-cut hopes.
The DAX index increased 0.1% to 16,896.03, the CAC-40 index rose 0.3% to 7,649.74, and the FTSE 100 index inched higher by 0.6% to 7,556.02.
The yield on 10-year German bonds edged up to 2.36%; French bonds inched higher to 2.85%; the UK gilts edged higher to 4.07%; and Italian bonds inched higher to 3.90%.
Banks across Europe declined after rate-cut hopes waned in the eurozone.
Societe Generale, BNP Paribas, UniCredit, and Commerzbank edged lower.
ABN Amro Bank increased 4.2% to €14.02 after the Dutch lender's quarterly earnings were ahead of market expectations.
ThyssenKrupp declined 8.5% to €5.05 after the German steelmaker lowered its full-year profit and sales outlook, citing weakening demand.
The company also took on impairment charges in its fiscal first quarter.
Schindler Holding increased 2% to CHF 212.80 after the Swiss elevator company estimated revenue growth of "low single-digit" in 2024.
Bilfinger SE soared 10.1% to €42.16 after the company won a large maintenance order from INEOS for the Forties Pipeline System.
Delivery Hero jumped 5.5% to €19.74 after the German food delivery company said its organic cash flow is sufficient to cover its bond and debt maturities.
Heineken NV dropped 5% to €88.48 after the alcoholic beverage maker issued a cautious outlook for 2024, citing uncertainty in global geopolitical and economic conditions.
Capgemini advanced 4.5% to €215.50 after the French IT consulting group reported solid results in 2023 despite the weak macroeconomic environment.
Dunelm Group decreased 0.7% to 1,078.0 pence after the UK-based home goods retailer reported strong results in the interim period for 26 weeks ending on December 30.
The company signaled that margin growth is likely to slow down in the coming months.
Coca-Cola HBC gained 5.7% to 2,332.0 pence after the Hellenic bottling company reported a record annual profit in 2023 and the company lifted its dividend.
UK Inflation Held Steady, Dutch GDP Expanded In the Final Quarter of 2023
Bridgette Randall
14 Feb, 2024
Frankfurt
European markets edged slightly higher in Wednesday's trading, a day after a sharp selloff following the release of the U.S. inflation report.
World markets traded down after U.S. inflation in January eased less than expected to an annual pace of 3.1% and core inflation stayed at 3.9%, supporting the case for the Federal Reserve to wait a longer before lowering interest rates.
In Wednesday's trading, benchmark indexes in Paris, London, and Frankfurt slightly advanced, and investors reacted to domestic corporate results.
UK Inflation Held Steady In January
Closer to home, the UK consumer price inflation rate held steady at 4.0%, the Office for National Statistics reported on Wednesday.
Core inflation, which excludes food and energy prices, was also unchanged at 5.1%.
On a monthly basis, inflation declined by 0.6%, after rising by 0.4% in December.
Dutch GDP Expands In the Final Quarter of 2023
The Netherlands GDP grew by 0.3% from the previous quarter in the final quarter of 2023, Statistics Netherlands reported Wednesday.
The Dutch economy expanded in the final quarter following the contraction in the previous three quarters in a row, after consumer spending rose 1.8% and government spending advanced 0.4%.
International trade did not make any contribution to the GDP after exports and imports rose 0.3%.
The Dutch GDP shrank by 0.5% from a year ago after contracting by 0.8% in the third quarter.
Europe Indexes and Yields
The DAX index increased 0.1% to 16,896.03, the CAC-40 index rose 0.3% to 7,649.74, and the FTSE 100 index inched higher by 0.6% to 7,556.02.
The yield on 10-year German bonds edged up to 2.36%; French bonds inched higher to 2.85%; the UK gilts edged higher to 4.07%; and Italian bonds inched higher to 3.90%.
The euro edged lower to $1.070, the British pound inched higher to $1.255, and the U.S. dollar gained to 88.79 Swiss cents.
Brent crude increased $0.09 to $82.67 a barrel, and the Dutch TTF natural gas fell by €0.56 to €24.88 per MWh.
Europe Stock Movers
Banks across Europe declined after rate-cut hopes waned in the eurozone.
Societe Generale, BNP Paribas, UniCredit, and Commerzbank edged lower.
ABN Amro Bank increased 4.2% to €14.02 after the Dutch lender's quarterly earnings were ahead of market expectations.
ThyssenKrupp declined 8.5% to €5.05 after the German steelmaker lowered its full-year profit and sales outlook, citing weakening demand.
The company also took on impairment charges in its fiscal first quarter.
Schindler Holding increased 2% to CHF 212.80 after the Swiss elevator company estimated revenue growth of "low single-digit" in 2024.
Bilfinger SE soared 10.1% to €42.16 after the company won a large maintenance order from INEOS for the Forties Pipeline System.
Delivery Hero jumped 5.5% to €19.74 after the German food delivery company said its organic cash flow is sufficient to cover its bond and debt maturities.
Heineken NV dropped 5% to €88.48 after the alcoholic beverage maker issued a cautious outlook for 2024, citing uncertainty in global geopolitical and economic conditions.
Capgemini advanced 4.5% to €215.50 after the French IT consulting group reported solid results in 2023 despite the weak macroeconomic environment.
Dunelm Group decreased 0.7% to 1,078.0 pence after the UK-based home goods retailer reported strong results in the interim period for 26 weeks ending on December 30.
The company signaled that margin growth is likely to slow down in the coming months.
Coca-Cola HBC gained 5.7% to 2,332.0 pence after the Hellenic bottling company reported a record annual profit in 2023 and the company lifted its dividend.
Japan and India Indexes Trade Lower, Hong Kong Stocks Rebound
Arjun Pandit
14 Feb, 2024
Mumbai
Across Asia, market indexes declined in Japan, Korea, and Indonesia, and financial markets remained closed in China.
Overall inflation fell to an annual pace of 3.1% in January, and core inflation, which excludes food and energy prices, stayed at 3.9%, significantly higher than the Federal Reserve's target rate of 2%.
Hotter-than-expected inflation in January supported the case for the Federal Reserve to wait for a while before lowering inflation, denting the critical assumption behind the market rally over the last three months.
Higher inflation suggests that the U.S. dollar is likely to advance and stock market indexes are likely to face downward pressures in the days ahead.
Japan Stocks Faced Selling Pressure
The Nikkei 225 average fell, tracking losses in overnight trading on Wall Street following the release of hotter-than-expected U.S. inflation in January.
The Nikkei 225 decreased 0.7% to 37,702.85 and eased from the 34-year high reached in the previous session.
The yen weakened to 150.25 against the U.S. dollar after U.S. rate-cut hopes were pushed back following the inflation report.
Exporters were among the leading decliners, and tech companies led the gainers.
Toyota Motor, Sony Group, Panasonic, Canon, Japan Tobacco, and Nippon Steel declined between 2% and 3%.
Advantest, Screen Holdings, Tokyo Electron, and Renesas Electronics gained between 0.5% and 1.0%.
Citizen Watch soared 5.9% to ¥1,049.0 after the company reported better-than-expected quarterly results. Sales in the fiscal third quarter rose 4.2% to 859 billion yen, and net income attributable to shareholders increased 2% to 73 billion yen.
Seiko Group advanced 0.5% to ¥2,738.0, following Citizen's results.
Sapporo Holding soared 7.7% to ¥7,406.0, and Idemitsu Kosan added 2.6% to ¥852.60 after the energy exploration company reported better-than-expected earnings.
Hang Seng Index Erased Morning Losses
The Hang Seng index advanced 0.3% to 15,797.59, and the benchmark index erased a 1.2% decline in the morning session after investors returned from a long weekend to celebrate the Lunar New Year.
Financial markets in mainland China and Taiwan are closed for the rest of the week.
Property developers continued on the downward path due to the ongoing worries of weak demand and a lack of specific stimulus from policymakers.
Longfor, China Resources Land, China Vanke, and Sun Hung Kai Properties declined between 1% and 3%.
New World Development, Budweiser Brewing, and Xinyi Glass declined around 1% after MSCI included these three companies in the list of 66 Chinese companies scheduled to be removed from its global standard index at the end of this month.
India Indexes Extend Losses
Stocks in Mumbai and Asia faced selling pressure after U.S. inflation was higher than expected in January.
The Sensex and the Nifty indexes dropped about 0.5% in early trading and dragged down tech service providers and banks after the release of the U.S. inflation report.
The Sensex index decreased 77.60 points to 71,087.45, and the Nifty index fell 17.70 points to 21,597.02.
On the Mumbai stock exchange, 89 stocks traded at their 52-week highs and 31 stocks traded at their 52-week lows.
Adani Group stocks were in focus after the U.S.-based rating agency Moody's Investor Service revised its outlook on four group companies to "stable" from "negative."
The ratings agency had lowered its outlook on Adani Green, Adani Electricity Mumbai, Adani Transmission, and Adani Energy Solutions after the U.S.-based short seller launched a media attack a year ago.
India Movers: Adani Group, BHEL, Eicher Motors, Hindalco, Wipro
Arun Goswami
14 Feb, 2024
Mumbai
Stocks in Mumbai traded down following the worldwide selloff after U.S. inflation in January was higher-than-expected, raising the prospect of interest rates staying higher for longer.
The Sensex index decreased 77.60 points to 71,087.45, and the Nifty index fell 17.70 points to 21,597.02.
On the Mumbai stock exchange, 89 stocks traded at their 52-week highs and 31 stocks traded at their 52-week lows.
Adani Group stocks were in focus after the U.S.-based rating agency Moody's Investor Service revised its outlook on four group companies to "stable" from "negative."
The ratings agency had lowered its outlook on Adani Green, Adani Electricity Mumbai, Adani Transmission, and Adani Energy Solutions after the U.S.-based short seller launched a media attack a year ago.
Hindalco Industries declined 0.4% to ₹507.90 after the company reported mixed quarterly results.
Revenue in the December quarter was flat at ₹52,808 crore, and after-tax income soared 71% to ₹2,331 crore from a year ago, respectively.
Eicher Motors added 0.2% to ₹3,862.70 after the company reported a rise in revenue and earnings.
Revenue in the December quarter rose 12.3% to ₹4,179 crore, and net income surged 34.4% to ₹996 crore from a year ago, respectively.
Oil India increased 1% to ₹474.85 after the company reported a decline in profit following weaker crude oil prices and windfall taxes.
Net income in the December quarter decreased 9.3% from a year ago to 1,584 crore.
BHEL declined 0.5% to ₹212.30 after the electrical equipment company suffered a loss in the latest quarter.
Revenue in the December quarter rose to ₹5,599.6 crore from ₹5,353.9 crore, and the company swung to a net loss of ₹148.7 crore due to higher operating expenses.
Wipro fell 1.9% to ₹501.70 and the company agreed to acquire the insurance-industry focused Aggne for $66 million.
Aggne is based in the Tampa, Florida and Hyderabad, India and employs 230 people.
Consumer Price Inflation In January Eased to 3.1%, Shelter Inflation Stayed Elevated
Brian Turner
13 Feb, 2024
New York City
Consumer price inflation in January eased to a 3.1% annual pace in January from 3.4% in December, the U.S. Bureau of Labor Statistics reported Tuesday.
The decline in overall inflation was driven by the fall in energy price inflation by 4.6% from 2.0% in December, and food prices rose at a slower pace of 2.6% compared to 2.7% in the previous month.
Compared to the previous month, consumer price inflation rose by 0.3%, the fastest pace of increase in four months.
Core inflation, which excludes food and energy price inflation, held steady at an annual pace of 3.9% but rose to a monthly rate of 0.4%.
U.S. and Europe Indexes Drop 1%, Asian Markets Face Weak Start
Barry Adams
13 Feb, 2024
New York City
Benchmark indexes on Wall Street turned lower after a hotter-than-expected inflation report raised the prospect of higher interest rates for longer, a key assumption underpinning the rally of the last three months.
The S&P 500 index and the Nasdaq Composite declined more than 1% after consumer prices rose at a faster-than-expected pace in January.
The yield on 2-year and 10-year Treasury notes advanced after inflation, and core inflation in January was ahead of market expectations.
Consumer price inflation in January eased to a 3.1% annual pace in January from 3.4% in December, the U.S. Bureau of Labor Statistics reported Thursday.
The decline in overall inflation was driven by the fall in energy price inflation by 4.6% from 2.0% in December, and food prices rose at a slower pace of 2.6% compared to 2.7% in the previous month.
But it was the stubborn shelter price inflation that kept the overall inflation still above 3%.
The rent and equivalent cost of occupying a residence increased by 0.6% from the previous month in January, accounting for more than two-thirds of the monthly increase for all items, according to the government agency.
Rents have stopped rising in most urban locations across the country, but that disinflation is still not reflected in the inflation data.
Compared to the previous month, consumer price inflation rose by 0.3%, the fastest pace of increase in four months.
Core inflation, which excludes food and energy price inflation, held steady at an annual pace of 3.9% but rose to a monthly rate of 0.4%.
U.S. indexes and yields
The S&P 500 index decreased 1.2% to 4,962.61, and the Nasdaq Composite fell 1.4% to 15,713.31.
The yield on 2-year Treasury notes advanced to 4.62%, 10-year Treasury notes increased to 4.28%, and 30-year Treasury bonds edged up to 4.44%.
WTI crude oil increased $1.21 to $78.13 a barrel, and natural gas prices declined 9 cents to $1.66 a thermal unit, a low last seen in September 2020.
Gold increased by $8.85 to $2,025.52 an ounce after the U.S. dollar gained in international trading.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.97.
U.S. Stock Movers
The Coca-Cola Company gained 1.1% to $60.40 after the beverage maker reported mixed quarterly results in the fourth quarter.
Revenue in the quarter rose to $10.85 billion after the company passed on higher prices to customers and bottlers.
JetBlue Airways soared 13.2% to $6.82 after activist investor Carl Icahn reported a 10% stake in the company and added that the company's stock is undervalued.
Zoominfo Technologies increased 16% to $18.40 after the market intelligence company reported better-than-expected quarterly results.
Hasbro declined 5.8% to $48.30 after the toymaker reported sharply lower-than-expected earnings in the fourth quarter.
Restaurant Brands International was nearly unchanged at $78.30 after the parent company of Tim Hortons reported better-than-expected quarterly results.
European Markets Closed Down After U.S. Inflation Report
European markets traded sideways as traders digested the latest economic data in the region and avoided taking positions after the release of the U.S. inflation.
Benchmark indexes in Frankfurt, Paris, and London edged slightly lower after lackluster trading in the previous session.
Investors reacted to corporate results from TUI, the hydrogen company ThyssenKrupp Nucera, and Siltronic.
Closer to home, the French jobless rate held steady in the fourth quarter of 2023, and Swiss inflation eased in January.
The jobless rate in the UK in the fourth quarter of 2023 decreased to 3.8% from 3.9% in the third quarter, according to the data released by the Office for National Statistics.
A separate report by the agency showed UK regular wages rose 6.2% in the final quarter, the lowest increase in fourteen months.
The higher-than-expected increase in regular wages also supported the advance in the pound, easing the pressure on the Bank of England to lower rates.
French Jobless Rate Held Steady In Final Quarter of 2023
The French jobless rate held steady at 7.5% in the fourth quarter after rising in the previous two quarters in a row, the statistical office INSEE reported Tuesday.
The jobless rate in the fourth quarter matched the rate in the third quarter but rose 0.4 percentage points in the final quarter of 2022, when the rate was the lowest since 1982 and significantly lower than the peak of 10.5% in mid-2015.
The number of unemployed persons increased by 29,000 to 2.3 million, and the jobless rate
Over the quarter, the youth unemployment rate decreased by 0.2 points for 15–24 year olds to 17.5%, increasing by 0.6 percentage points from the previous year.
The unemployment rate for those between the ages of 25 and 49 increased by 0.2 points over the quarter, to 7.0%, and is 0.5 points above its level a year earlier.
Finally, the jobless rate for those aged 50 or over was almost stable over the quarter at 5.0%.
The activity rate for those between 15 and 64 old increased by 0.4 percentage points from a year ago to 74.1%, the highest level since record-keeping began in 1975.
Swiss Inflation Eased In January
The Swiss inflation rate dropped to the lowest level in January since October 2021, after inflation for housing and utilities eased, the Swiss Federal Statistics Office reported Tuesday.
Consumer price inflation eased to 1.3% in January from 1.7% in December, after housing and utility inflation decreased to 2.5% from 3.3% in the previous month.
Food and non-alcoholic beverage inflation slowed to 2.3% from 3.3%, and restaurant and hotel price inflation slowed to 2.3% from 2.8%.
The core rate of inflation, which excludes volatile food and energy prices, rose 1.2%.
On a monthly basis, prices rose 0.2% in January from December, reflecting higher electricity and hotel prices.
Europe Indexes and Yields
The DAX index decreased 0.9% to 16,880.83, the CAC-40 index fell 0.8% to 7,625.31, and the FTSE 100 index inched lower by 0.8% to 7,512.28.
The yield on 10-year German bonds edged down to 2.35%; French bonds inched higher to 2.85%; the UK gilts edged higher to 4.07%; and Italian bonds inched higher to 3.90%.
The euro edged lower to $1.076, the British pound inched higher to $1.264, and the U.S. dollar gained to 88.15 Swiss cents.
Brent crude increased $0.81 to $82.81 a barrel, and the Dutch TTF natural gas declined by €0.29 to €25.44 per MWh.
Europe Stock Movers
TUI AG increased 2.7% to €7.03 after the tour operator reported a narrower loss in the fiscal first quarter and the company reiterated its annual outlook.
Higher demand for tour packages and improved prices and rates also helped the company cut its losses.
Thyssenkrupp Nucera increased 5.9% to €15.82 after the hydrogen company said its fiscal first quarter revenue increased by more than a third because of the rising demand for its electrolyser technology.
Randstad NV added 1.3% to €53.96 after the Dutch staffing company said it plans to return €632 million to shareholders and meet its capital allocation plan.
Nikkei 225 Index Nears 34-year High
Market indexes in Tokyo jumped after investors returned from a three-day weekend, and the rise in tech stocks led the gainers.
The Nikkei 225 index soared 2.9% to 37,963.97 and traded at a fresh 34-year high, and the yen weakened to 149.10 against the U.S. dollar.
Lasertec, Advantest, Screen Holdings, and Tokyo Electron gained between 1.5% and 2.5%, respectively.
SoftBank Group soared 6.1% to ¥8,479.0 following the surge in Arm Holdings in New York trading on Friday and Monday.
Market indexes in Seoul advanced 1%, but in Sydney, they struggled to stay above the flatline.
Elsewhere in the region, financial markets were closed in mainland China, Taiwan, Hong Kong, Malaysia, and Singapore to celebrate the Lunar New Year.
MSCI Increased India Weight In Global Index
NMDC, Union Bank, Punjab National Bank, BHEL, and GMR Airports traded higher after MSCI added the companies to its MSCI India Standard index.
The index provider increased its India weight to 18.2%, a record high, only to be surpassed by the weight of China-based companies in its global index.
The independent research service provider removed 66 Chinese companies from its MSCI Global Standard Index and added five Indian and Chinese companies, but did not remove any Indian companies.
The revised weights will be reflected in the indexes after the close on February 29.
India Inflation Slowed In January
Consumer price inflation eased to 5.1% in January from 5.69% in December, after food price inflation softened to 8.3% from 9.53% in the previous month, according to the Ministry of Statistics and Programme Implementation.
India's Industrial Output Accelerated
Industrial output expanded 3.8% in December, faster than the 2.4% increase in November, a separate report from the agency showed.
Mining production expanded 5.1%, followed by a 3.9% rise in manufacturing production and a 1.2% increase in electricity output.
During the first nine months of the fiscal year 2024, industrial output rebounded 6.1% from a year ago due to sustained expansion in all three categories.
India Stocks Rebounded at Close
In Mumbai, market sentiment was positive in Tuesday's trading, and investors reviewed the latest updates on inflation and industrial output.
The Sensex and the Nifty indexes advanced after consumer price inflation slowed in January and industrial production rebounded in December.
The Sensex index increased 0.7% to 71,555.19, and the Nifty index rose 0.6% to 21,743.25.
Coal India advanced 2.2% to ₹442.20 after the mining company reported its quarterly results.
Revenue from operations increased 2.8% to ₹36,153.97 crore from ₹35,169.33 crore, and net profit rose 17.8% to ₹9,093.69 crore from ₹7,719.11 crore a year ago, respectively.
Coal production in the quarter increased to 199 million tons from 180 million tons a year ago.
The company also declared its second interim dividend of ₹5.25 per share to be payable on February 20.