Market Update
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.
PBOC Holds Loan Prime Rates and Announces Measures to Facilitate Residential Property Market
Li Chen
19 May, 2024
Hong Kong
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.
U.S. Movers: GameStop, Take Two Interactive
Scott Peters
17 May, 2024
New York City
Take Two Interactive declined 0.7% to $145.05 after the online game developer said Grand Theft Auto is now scheduled for its next release in the fall of 2025.
Total net revenue in the fiscal fourth quarter declined to $1.399 billion from $1.44 billion, net loss expanded to $2.9 billion from $610 million, and diluted loss per share soared to $17.02 from $3.62 a year ago.
GameStop Corp. declined 21.6% to $21.70 after the video game retailer posted weaker-than-expected preliminary quarterly results.
Revenue in the fiscal fourth quarter ending on February 3 declined to $1.794 billion from $2.226 billion, and net income increased to $63.1 million from $48.2 million a year ago, respectively.
The specialty retailer also plans to sell as many as 45 million shares in a secondary offering.
S&P 500 and Nasdaq Extend Weekly Gains Amid Rate Path Uncertainty
Barry Adams
17 May, 2024
New York City
Stocks and benchmark indexes rested in early trading on Friday, and the yield on U.S. Treasury notes rebounded.
The bond yield edged higher after three Federal Reserve officials stressed the need for higher interest rates until more evidence emerges indicating that inflation is trending towards the 2% target rate.
The S&P 500 and the Nasdaq Composite traded at new highs in Wednesday's trading, and benchmark indexes traded down on Thursday and extended the weakness in Friday's trading.
Market indexes are hovering near record highs amid widespread beliefs that inflation is not likely to rebound in the months ahead, providing enough elbow room for policymakers to cut rates twice in the second half of the year.
However, rate-cut optimism may be misplaced if wages continue to rise above 4% and service sector inflation hovers close to 4%.
Moreover, home prices are still rising at a rapid pace across the nation, contributing to overall inflationary forces.
U.S. Indexes and Treasury Yields
The S&P 500 index decreased 0.1% to 5,294.90, and the Nasdaq Composite fell 0.1% to 16,682.22.
The yield on 2-year Treasury notes edged higher to 4.81%, 10-year Treasury notes increased to 4.41%, and 30-year Treasury bonds edged higher to 4.54%.
WTI crude oil increased $0.01 to $79.24 a barrel, and natural gas prices increased 2 cents to $2.51 a thermal unit.
Gold increased by $10.74 to $2,388.44 an ounce, and silver rose 9 cents to $29.77.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.75.
U.S. Stock Movers
Take Two Interactive declined 0.7% to $145.05 after the online game developer said Grand Theft Auto is now scheduled for its next release in the fall of 2025.
Total net revenue in the fiscal fourth quarter declined to $1.399 billion from $1.44 billion, net loss expanded to $2.9 billion from $610 million, and diluted loss per share soared to $17.02 from $3.62 a year ago.
GameStop Corp. declined 21.6% to $21.70 after the video game retailer posted weaker-than-expected preliminary quarterly results.
Revenue in the fiscal fourth quarter ending on February 3 declined to $1.794 billion from $2.226 billion, and net income increased to $63.1 million from $48.2 million a year ago, respectively.
The specialty retailer also plans to sell as many as 45 million shares in a secondary offering.
Europe Movers: Engie, Land Securities, Richemont, SCOR, Unilever
Inga Muller
17 May, 2024
Frankfurt
European markets halted three-week rally after investors scaled back rate-cut expectations following comments from policymakers.
The DAX index decreased by 0.4% to 18,667.67; the CAC-40 index fell by 0.4% to 8,154.76; and the FTSE 100 index inched lower by 0.4% to 8,407.41.
The yield on 10-year German bonds edged up to 2.48%; French bonds inched higher to 2.98%; the UK gilts edged lower to 4.11%; and Italian bonds inched lower to 3.78%.
Richemont SA increased 5.8% to CHF 145.40 after the Swiss luxury goods company announced several management and board changes.
Richemont appointed Nicolas Bos, currently serving as chief executive of Van Cleef & Arpels, as the company's new chief executive, replacing Jerome Lambert.
SCOR SE declined 7.7% to €29.70 after the French reinsurance company said first-quarter net income dropped 37% to €196 million from €311 million a year ago.
Engie SA decreased 1.6% to €15.53 after the French electric utility reported a slight decline in its operating earnings in the first quarter amid broad weakness in revenue.
Revenue dropped 24.6% to €22.0 billion from €29.6 billion, and operating earnings edged down 0.1% to €5.4 billion.
The company reiterated its 2024 recurring income outlook between €4.1 billion and €4.8 billion and its operating earnings, excluding nuclear division, to range between €7.5 billion and €8.5 billion.
Land Securities declined 2.8% to 670.50 pence after the company said annual rental income declined to £371 million from £393 million in 2023.
Pre-tax losses shrank to 341 million from 622 million, and the basic loss per share fell to 43 pence from 83.6 pence a year ago.
The company hiked the dividend by 2.6% to 39.6 pence from 38.6 pence a year ago.
Unilever advanced 0.6% to 4,307.0 pence after the consumer products company launched its €1.5 billion stock repurchase plan.
European Markets Halt 3-week Rally, French Jobless Rate Held Steady at 7.5%
Bridgette Randall
17 May, 2024
Frankfurt
European markets edged lower for the second day in a row after a nine-day rally in the previous session.
Market sentiment was cautious after several U.S. and European policymakers cautioned against rate cuts.
Benchmark indexes in Frankfurt, Paris, and London extended weekly losses after comments from the European Central Bank rate-setting committee cautioned against additional rate cuts after June.
In addition, three U.S. policymakers stressed the need to keep rates higher for longer until solid evidence emerges that inflation is on the way to 2%.
The eurozone consumer price inflation was confirmed at 2.4% in April, matching the rate in March, the statistical agency Eurostat reported Friday.
French Jobless Rate Held at 7.5%
France's jobless rate held steady at 7.5%, matching rates in the previous two quarters.
The unemployment rate in the first quarter increased by 6,000 to 2.3 million, the statistical agency INSEE reported Friday.
The jobless rate among people between 15 and 24 inched up 0.6% to 18.1% and increased 0.1 percentage point to 5.1% for those older than 50.
The unemployment rate between the ages of 25 and 49 eased by 0.2 percentage points to 6.8%.
Moreover, mixed economic data from China also weighed on market sentiment.
China's Property Market Woes Deepen, Retail Sales Growth Slows
China's retail sales rose less than expected by 2.3% in April, but the jobless rate declined to 5.0% from 5.3% in March.
Industrial output, one of the few bright spots in the Chinese economy, rose faster-than-expected by 6.7% in April.
China's fixed-asset investment rose 4.2% from a year ago in the January–April period, slower than 4.5% in the January–March period.
Property investment deepened to 9.8% in the first four months from 9.5% in the first quarter, prompting calls for wider and faster regulatory reforms.
Meanwhile, overall residential floor space sold in April declined by 20.2%, and the sales value of new homes dropped by 28.3% from a year ago.
Europe Indexes and Yields
The DAX index decreased by 0.4% to 18,667.67; the CAC-40 index fell by 0.4% to 8,154.76; and the FTSE 100 index inched lower by 0.4% to 8,407.41.
The yield on 10-year German bonds edged up to 2.48%; French bonds inched higher to 2.98%; the UK gilts edged lower to 4.11%; and Italian bonds inched lower to 3.78%.
The euro edged higher to $1.084; the British pound inched higher to $1.266; and the U.S. dollar gained to 90.92 Swiss cents.
Brent crude increased $0.07 to $83.34 a barrel, and the Dutch TTF natural gas rose by €0.29 to €30.86 per MWh.
Europe Stock Movers
Richemont SA increased 5.8% to CHF 145.40 after the Swiss luxury goods company announced several management and board changes.
Richemont appointed Nicolas Bos, currently serving as chief executive of Van Cleef & Arpels, as the company's new chief executive, replacing Jerome Lambert.
SCOR SE declined 7.7% to €29.70 after the French reinsurance company said first-quarter net income dropped 37% to €196 million from €311 million a year ago.
Engie SA decreased 1.6% to €15.53 after the French electric utility reported a slight decline in its operating earnings in the first quarter amid broad weakness in revenue.
Revenue dropped 24.6% to €22.0 billion from €29.6 billion, and operating earnings edged down 0.1% to €5.4 billion.
The company reiterated its 2024 recurring income outlook between €4.1 billion and €4.8 billion and its operating earnings, excluding nuclear division, to range between €7.5 billion and €8.5 billion.
Land Securities declined 2.8% to 670.50 pence after the company said annual rental income declined to £371 million from £393 million in 2023.
Pre-tax losses shrank to 341 million from 622 million, and the basic loss per share fell to 43 pence from 83.6 pence a year ago.
The company hiked the dividend by 2.6% to 39.6 pence from 38.6 pence a year ago.
Unilever advanced 0.6% to 4,307.0 pence after the consumer products company launched its €1.5 billion stock repurchase plan.
Yen and Tech Stock Weakness Drive Stock Market Volatility In Japan
Akira Ito
17 May, 2024
Tokyo
Stocks in Tokyo struggled in Friday's trading as investors digested the latest update on GDP and the movement in currency trading.
Market sentiment in Tokyo was cautious a day after Japan's GDP report showed an annual contraction of 2%, and private sector consumption fell for the fourth quarter in a row.
The ongoing natural disaster-related challenges and scandal-ridden production halts at Toyota's Daihatsu Motor also contributed to the economic contraction.
The yen eased to 155.76 against the U.S. dollar after the currency faced renewed pressure on speculation that the Bank of Japan continued to buy Japanese government bonds in the amount matching the previous operation.
Bank of Japan Governor Ueda is widely anticipated to announce the central bank's bond buying program at the next meeting in June.
Earlier in the month, Governor Kazuo Ueda confirmed that the central bank has no plans to sell its exchange-traded fund holdings.
Japan Stock Movers
Stocks in Tokyo traded lower, and tech stocks led the decliners and reversed the previous day's gains.
The Nikkei 225 Stock Average fell 0.6% to 38,703.95, and the Topix index advanced 0.1% to 2,740.22.
For the week, the Nikkei index increased 1.7% and extended this year's gain to 16.4%.
The Topix index added 0.8% in the week and advanced 15.2% in the year so far.
Tokyo Electron, Advantest, Screen Holdings, and SoftBank declined between 1% and 3%.
Banks were in focus in Friday's trading after investors debated the future rate paths and assessed the impact of a weaker yen on corporate profits.
Mitsubishi UFJ and Mizuho Financial Group rose about 1.7%, but Sumitomo Mitsubishi Financial declined 1.8%.
Japan Steel Works rose 6.5% to 4,434.0 yen, and earlier in the week, the steelmaker reported slower annual revenue growth in the fiscal year ending in March.
Revenue increased 5.8% to 252.5 billion yen from 238.7 billion yen, profit attributable shareholders rose 19.2% to 14.3 billion yen, and earnings per share increased to 194.02 yen from 162.75 yen a year ago.
The company declared an annual dividend of 29 yen, matching the previous year, and the total dividend increased to 59 yen from 58 yen a year ago.
China's Weak Economic Data Highlighted Difficulties of Meeting 5% Annual Growth Target
Li Chen
17 May, 2024
Hong Kong
Stocks in Shanghai and Hong Kong faced selling pressure after the latest economic data highlighted weak consumer demand.
On Friday, the National Bureau of Statistics reported retail sales, fixed investments, home prices, and industrial output data.
The latest economic data, coupled with credit demand data released last week, highlighted that the government may face challenges in meeting its annual economic growth target of 5% this year.
Weak consumer domestic demand, slowing private sector investment, and ongoing property sector weakness are contributing to the weakening economic growth profile of the second-largest economy.
Retail sales rose less-than-expected 2.3% in April, a 15-month low, as consumers avoided large purchases amid job market uncertainty and ongoing property market weakness.
Retail sales growth slowed from a 3.1% rise in March a year ago.
Industrial output, one of the few bright spots in the Chinese economy, rose faster-than-expected by 6.7% in April.
China's fixed-asset investment rose 4.2% from a year ago in the January–April period, slower than 4.5% in the January–March period.
Property investment deepened to 9.8% in the first four months from 9.5% in the first quarter, prompting calls for wider and faster regulatory reforms.
Meanwhile, overall residential floor space sold in April declined by 20.2%, and the sales value of new homes dropped by 28.3% from a year ago.
Prices of new homes in large and well-developed cities, generally known as first-tier cities, decreased by 0.6% from March, the 11th month of decline in a row, the statistical bureau reported Friday.
At the same time, existing home prices decreased by 0.9% from March.
The National Statistics Bureau said new home prices declined in 64 of 70 medium and large cities in April, an increase from 57 cities in March.
However, existing home prices fell in 69 cities in April, matching the number in March.
Despite the weakening in investment, the jobless rate declined to 5.0% in April from 5.2% in March, the statistical bureau said on Friday.
China Stock Movers
The CSI 300 index decreased 0.2% to 3,633.04, and the Hang Seng index advanced 0.3% to 19,433.14.
Ping An Insurance Group advanced 1.6% to HK$43.70 on widespread rumors that China's insurance giant is considering its stake in UK-based HSBC Holdings.
HSBC decreased 3.1% to HK$67.95.
Property developers were in focus for the second day in a row after property investment in the first four months fell at a faster pace than in the first quarter.
The weakness in property sector investment raised hopes of concrete steps from the government.
China Vanke rose 4.2% to HK$5.97, China Resources Land decreased 1.1% to HK$31.55, and Longfor Group soared 7.4% to HK$14.80.
Banks were among the most actively traded stocks in Shanghai and Hong Kong.
ICBC decreased 0.6% to HK$4.68, Bank of China declined 0.1% to HK$3.87, and Agriculture Bank of China fell 0.2% to $3.81.
Tencent Holdings advanced 0.5% to HK$395.60 and Baidu Inc. fell 0.5% to HK$111.50 after the two leading tech companies reported better-than-expected quarterly results.