Market Update
U.S. Movers: American Airlines, Alaska Air, Boeing, IBM, Tesla
Scott Peters
25 Jan, 2024
New York City
Tesla declined 8% to $191.10 after the company reported quarterly results and issued a weak 2024 unit sales outlook.
Revenue in the fourth quarter increased 3% to $25.2 billion from $24.3 billion, net income soared 115% to $7.9 billion from $3.7 billion, and diluted earnings per share advanced to $2.27 from $1.07 a year ago.
The latest quarterly income included a one-time non-cash tax benefit of $5.9 billion.
Free cash flow in the quarter increased to $2.0 billion from $1.4 billion a year ago.
In 2023, total revenues soared 19% to $96.7 billion, net income attributable to shareholders jumped 19% to $15 billion, and diluted earnings per share advanced 19% to $4.30.
Vehicles delivered in 2023 increased by 38% to 1.8 million from a year ago, and supercharger stations soared by 27% to 5,952 from a year ago, respectively.
The company said the vehicle volume growth rate in 2024 may be notably lower than the growth rate achieved in 2023 as the company prepares to launch the next-generation vehicle built at its factory in Texas.
Boeing declined 4.2% to $205.11 after the Federal Aviation Authority halted the company's plan to expand its production of 737 Max jets but also approved the company's plan to bring the Max 9 back into service.
IBM increased 7.3% to $186.59 after the technology company reported better-than-expected quarterly results.
Revenue in the fourth quarter increased 4% to $17.4 billion from $16.7 billion, net income soared 3% to $3.3 billion from $2.7 billion, and diluted earnings per share jumped to $3.55 from $2.96 a year ago.
In the year 2023, revenue increased 2% to $61.9 billion, net income jumped to $7.5 billion from $1.6 billion, and diluted earnings per share advanced to $8.14 from $1.80 a year ago.
The technology company forecasted 2024 revenue to increase "mid-single-digit" and free cash flow to be around $12 billion.
American Airlines increased 4.3% to $14.53 after the international carrier reported quarterly results.
Total operating revenue in the fourth quarter decreased 1% to $13.0 billion from $13.2 billion, net income plunged to $19 million from $803 million, and diluted earnings per share dropped to 3 cents from $1.14 a year ago.
Full-year revenue surged 7.8% to record $52.8 billion from $48.9 billion, net income jumped to $822 million from $127 million, and diluted earnings per share advanced to $1.21 from 19 cents a year ago.
Passenger load factor in the quarter edged slightly lower to 83.6% from 83.9%, but total revenue per available seat mile declined 6.4% to 17.21 cents from 18.39 cents a year ago, respectively.
Alaska Air increased by 0.5% to $36.02 after the regional airline reported mixed quarterly results.
Revenue in the fourth quarter increased 3% to $2.6 billion from $2.5 billion, net income swung to a loss of $2 million from a profit of $22 million, and diluted earnings per share were (0.02) cents compared to 17 cents a year ago.
Alaska Air said the grounding of the Boeing 737 Max 9 will cost the company $150 million after a door panel blew off midair on January 5.
Alaska said it would resume service using a Boeing 737 Max 9 as early as Friday after the FAA approved the inspection instructions for the aircraft prior to placing it into operation.
Europe Movers: Epiroc, Givaudan, Nokia, STMicroelectronics
Inga Muller
25 Jan, 2024
Frankfurt
European markets were on hold ahead of the ECB's interest rate decision and monetary policy outlook, and bond yields edged higher.
The DAX index decreased 0.3% to 16,831.69, the CAC-40 index fell 0.1% to 7,446.92, and the FTSE 100 index inched lower by 0.01% to 7,527.28.
The yield on 10-year German bonds edged up to 2.36%; French bonds inched higher to 2.86%; the UK gilts edged higher to 4.05%; and Italian bonds inched higher to 3.94%.
Givaudan SA rose 4.6% to CHF 3,470.0 after the maker of flavors and fragrances reported results that met market expectations.
2023 sales increased 4.1% to CHF6.9 billion, net income rose 4.3% to CHF893 million, and free cash flow jumped 92% to CHF920 million.
The company proposed a cash dividend of CHF 68 per share, an increase of 1.5% from a year ago.
Epiroc AB decreased 1.8% to SEK184.20 after the company reported mixed quarterly results.
Revenue in the fourth quarter increased 12% to SEK 15.6 billion from SEK 13.9 billion, and orders received rose 5% to SEK 14.7 billion from SEK 13.7 billion a year ago.
Profit after tax decreased 5% to SEK 2.2 billion from SEK 2.4 billion, and diluted earnings per share fell to SEK 1.87 from SEK 1.98 a year ago.
STMicroelectronics declined 2.3% to €41.63 after the semiconductor company reported revenue and earnings slightly below expectations.
Revenue in the fourth quarter declined 3.2% to $4.3 billion from $4.4 billion, net income dropped 13.8% to $1.07 billion from $1.09 billion, and diluted earnings per share fell to $1.14 from $1.32 a year ago.
The company forecast first-quarter revenue of $3.6 billion, a decline of 15.2% from a year ago and 15.9% from the previous quarter.
Full-year 2024 revenue is expected to range between $15.9 billion and $16.9 billion, and gross margin percentage is estimated between the lows and mid-40s.
Capital expenditure in 2024 is expected to be around $2.5 billion.
Nokia jumped 7.6% to €3.39 after the Finnish telecom equipment maker announced a €600 million stock repurchase program over a period of two years.
The company board also approved a 3 cents per share cash dividend to shareholders on record on January 30 to be paid on February 8.
Net sales in the fourth quarter declined 23% to €5.7 billion from €7.5 billion, net income swung to a loss of €33 million from a profit of €3.2 billion, and diluted earnings per share were (0.01) compared to 56 cents a year ago.
European Bond Yields Edged Higher Ahead of ECB Rate Decision
Bridgette Randall
25 Jan, 2024
Frankfurt
Stocks in Europe gyrated ahead of an interest rate announcement and monetary policy direction by the European Central Bank.
The ECB is widely expected to hold rates steady, but investors are looking ahead to the policymaker's view on the economy and the future direction of interest rates.
Benchmark indexes traded around the flatline, and bond yields edged higher.
Brent crude oil jumped to $80 a barrel on the expectation of a demand growth recovery after the People's Bank of China injected liquidity into the financial system and politicians vowed for more "forceful" measures to stabilize financial markets.
On the earnings front, investors are looking ahead to quarterly results from Louis Vuitton, Christian Dior, SEB, Epiroc, Tryg, STMicroelectronics, and Givaudan.
Spain's PPI Declined 10th Consecutive Month
Spain's producer price inflation declined for the 10th month in a row in December, the National Statistics Institute, or INE, reported Thursday.
Producer prices declined by 6.3% in December from a year ago and fell from the upwardly revised 7.6% in the previous month.
The decline in energy costs drove the fall in overall producer prices, and energy prices fell by 20.6% in the month after falling by 23.5% in the previous month.
Europe Indexes and Yields
The DAX index decreased 0.3% to 16,831.69, the CAC-40 index fell 0.1% to 7,446.92, and the FTSE 100 index inched lower by 0.01% to 7,527.28.
The yield on 10-year German bonds edged up to 2.36%; French bonds inched higher to 2.86%; the UK gilts edged higher to 4.05%; and Italian bonds inched higher to 3.94%.
The euro edged lower to $1.089, the British pound inched higher to $1.272, and the U.S. dollar gained to 86.39 Swiss cents.
Brent crude increased $0.91 to $80.95 a barrel, and the Dutch TTF natural gas decreased by €0.05 to €28.88 per MWh.
Europe Stock Movers
Givaudan SA rose 4.6% to CHF 3,470.0 after the maker of flavors and fragrances reported results that met market expectations.
2023 sales increased 4.1% to CHF6.9 billion, net income rose 4.3% to CHF893 million, and free cash flow jumped 92% to CHF920 million.
The company proposed a cash dividend of CHF 68 per share, an increase of 1.5% from a year ago.
Epiroc AB decreased 1.8% to SEK184.20 after the company reported mixed quarterly results.
Revenue in the fourth quarter increased 12% to SEK 15.6 billion from SEK 13.9 billion, and orders received increased 5% to SEK 14.7 billion from SEK 13.7 billion a year ago.
Profit after tax decreased 5% to SEK 2.2 billion from SEK 2.4 billion, and diluted earnings per share fell to SEK 1.87 from SEK 1.98 a year ago.
STMicroelectronics declined 2.3% to €41.63 after the semiconductor company reported revenue and earnings slightly below expectations.
Revenue in the fourth quarter declined 3.2% to $4.3 billion from $4.4 billion, net income dropped 13.8% to $1.07 billion from $1.09 billion, and diluted earnings per share fell to $1.14 from $1.32 a year ago.
The company forecast first-quarter revenue of $3.6 billion, a decline of 15.2% from a year ago and 15.9% from the previous quarter.
Full-year 2024 revenue is expected to range between $15.9 billion and $16.9 billion, and gross margin percentage is estimated between the lows and mid-40s.
Capital expenditure in 2024 is expected to be around $2.5 billion.
China Stocks Ride Higher On Stimulus Hopes, Tesla Suppliers and EV Makers Turn Lower In Asia
Arjun Pandit
25 Jan, 2024
Mumbai
Asian markets generally advanced in Thursday's trading on the hopes that the People's Bank of China and Chinese government will soon announce more concrete policy measures to support financial markets.
In overnight trading, market indexes on Wall Street closed higher after a tech rally supported the rise of the S&P 500 index and the Nasdaq 100 index to record levels.
Electric vehicle components and electric display makers in Tokyo, Shanghai, and Seoul declined after Tesla reported weaker-than-expected earnings in the fourth quarter.
Moreover, Tesla guided a "notable decline in sales volume" in 2024 on global macroeconomic headwinds and rising competition from low-priced Chinese electric vehicle makers.
European markets also advanced following the rise in U.S. stocks, and tech stocks soared by as much as 5%.
Crude oil prices traded higher amid ongoing tensions in the Middle East and Red Sea, and merchant ships continued to avoid transporting through troubled waters.
Nikkei Struggled to Get Traction on BoJ Policy Shift Worries
The Nikkei 225 advanced 0.2% to 36,290.62 after falling as much as 0.2% in the morning session.
The Nikkei has been volatile over the last two days, hovering near a 34-year high on the basis of growing worries that the Bank of Japan is likely to end its ultra-loose monetary policy sooner than expected.
The Japanese yen edged higher near 147 against the U.S. dollar, and investors are awaiting the release of Tokyo inflation data on Friday.
Electric vehicle components and suppliers declined after Tesla reported weaker-than-expected earnings in the fourth quarter and guided a sharp decline in unit sales volume in 2024.
Nidec Corp. declined 3.7%, Disco Corp. jumped 1.7%, and Panasonic Holdings dropped 2.2%.
South Korea's 2023 GDP Growth Slowed
South Korea's gross domestic product growth was unchanged from the previous quarter, after government spending accelerated but consumer spending growth remained muted.
The gross domestic product in the fourth quarter increased by 0.6% from the previous quarter, matching the rate in the third and second quarters, the Bank of Korea reported Thursday.
On an annual basis, the economy expanded at a faster pace of 2.2% from the 1.4% rate increase in the previous quarter.
Government spending accelerated to 0.4% from 0.2% in the previous quarter, and consumer spending edged up 0.2% from unchanged.
Export growth slowed to 2.6% from 3.4% in the previous quarter, and import growth eased to 1% from 2.3%, respectively.
For all of 2023, the economy expanded by 1.4%, and economic growth slowed for the second year in a row, after expanding at 2.2% in 2022 and 4.3% in 2021.
In stock trading, the KOSPI index decreased 0.07% to 2,468.0 and extended this year's loss to 7.5%.
China Indexes Extended Rally to Third Day
China stocks rebounded for the third day in a row after investors put more faith in the recently announced stimulus measures.
The CSI index advanced 1.8% to 3,334.94, and the Hang Seng index soared 1.9% to 16,193.49 and extended the 3-day gain to over 5%.
The People's Bank of China lowered its bank reserve requirement for the first time in four months, injecting as much as $140 billion of liquidity into its financial system.
Moreover, the central bank also permitted banks to accept commercial real estate as collateral to seek funding to repay existing debts.
The move was widely welcomed by investors, but the measures are likely to fall short of reviving consumer confidence and market sentiment in the long term.
Alibaba Group advanced 0.8%, Tencent jumped 2.8%, Baidu advanced 3.2%, China Resources Land added 1.4%, and Longfor Group advanced 4.8%.
Li Auto, Xpeng, and Nio declined between 1.5% and 4.9% after Tesla earnings were below market expectations and the electric vehicle maker guided a decline in sales volume in 2024.
India Indexes Faced Headwinds After Mixed Quarterly Results
Stocks in Mumbai edged lower, and investors reviewed a flood of corporate earnings results.
The Nifty and the Sensex indexes traded down, and banks were in focus after Canara Bank, Bank of Baroda, and Indian Bank reported strong quarterly results.
Tech Mahindra dropped following the decline in revenue and profit, and Bajaj Auto faced headwinds from the persistent weakness in export sales growth.
The Sensex index decreased 287.67 points to 70,772.64, and the Nifty index fell 63.20 points to 21,390.75.
On the Mumbai stock exchange, 156 stocks traded at their 52-week highs and 8 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds increased to 7.17%, and the Indian rupee edged lower to ₹83.13 against the U.S. dollar.
India Movers: Bajaj Auto, CEAT, Bank of Baroda, Canara Bank, Dalmia Bharat, Bank of India, Indian Oil, Tata Steel, Tech Mahindra
Arun Goswami
24 Jan, 2024
Mumbai
Stocks in Mumbai edged lower, and investors reviewed a flood or corporate earnings results.
The Sensex index decreased 287.67 points to 70,772.64, and the Nifty index fell 63.20 points to 21,390.75.
On the Mumbai stock exchange, 134 stocks traded at their 52-week highs and 8 stocks traded at their 52-week lows.
Tata Steel increased 3.7% to ₹134.90 after the company swung to a profit in its latest quarter.
Consolidated revenue in the December quarter decreased 3.1% to 55,311.9 crore, and the company swung to a profit of 513.4 crore from a loss of 2,223.5 crore a year ago.
Dalmia Bharat gained 2.8% to ₹2,168.55 after the company reported quarterly results.
Revenue in the December quarter rose 7% to ₹3,600 crore, and net profit advanced 29% to 263 crore from a year ago.
CEAT Ltd. jumped 4.5% to ₹2,880.10 after the company reported a surge in revenue and profit in its latest quarter.
Revenue in the December quarter rose 8.6% to ₹2,963.1 crore, and net income soared five-fold to ₹181.5 crore from a year ago.
Indian Oil Corporation advanced 3.8% to ₹144.20 after the company reported a sharp jump in quarterly earnings.
Net income in the December quarter soared 12-fold to ₹9,030 crore from ₹773 crore in the corresponding period a year ago.
Bajaj Auto added 2% to ₹7,360.0 after the company reported positive quarterly results.
Revenue in the December quarter increased by 30% to ₹12,165 crore, and net income advanced by 38% to ₹2,032 crore a year ago.
Tech Mahindra declined 4.5% to ₹1,349.10 after the company reported weaker-than-expected quarterly results.
Revenue in the December quarter decreased 4.6% to ₹13,101 crore, and net income plunged 60.6% to ₹510.4 crore from a year ago.
Indian Bank gained 3.3% to ₹455.0 after the company reported a surge in profit and revenue in its latest quarter.
Revenue in the December quarter rose 18.8% to ₹16,099 crore, and profit after-tax surged 52% to ₹2,119 crore from ₹1,396 crore a year ago.
Canara Bank added 1.1% to ₹459.60, and the company reported a double-digit increase in revenue and earnings.
Total net income in the December quarter rose 9.5% to ₹9,417 crore, and after-tax profit jumped 26.9% to ₹3,656 crore from a year ago.
Bank of Baroda added 0.02% to ₹228.55 after the company raised ₹5,000 crore through the sale of 10-year infrastructure bonds paying an interest rate of 7.57%.
S&P 500 and Nasdaq 100 Traded at New Record Highs
Barry Adams
24 Jan, 2024
New York City
Benchmark indexes advanced on Wall Street after tech stocks powered ahead.
The S&P 500 index and the Nasdaq Composite advanced more than 0.7% in Wednesday's trading after Netflix reported more-than-expected net subscriber additions.
Mega-cap tech stocks Alphabet, Apple, Amazon, Meta, Microsoft, and Netflix advanced, and the S&P 500 index and the Nasdaq Composite traded at new record highs.
Dupont de Nemours plunged 12.5% to $65.34 after the chemical company reported weak fourth-quarter results and issued a weak outlook for the current quarter.
eBay increased 3.8% to $43.0 after the online marketplace operator announced its plan to lay off 9% of its workforce, or about 1,000 jobs, over the next several months.
After the close, Tesla, IBM, and Las Vegas Sands are scheduled to report quarterly results.
Crude oil traded volatile in international markets, and shipping companies continue to avoid Red Sea Lanes amid ongoing Houthi rebel attacks in the region.
The Houthi attacks are impacting India's petroleum product shipments; about 25% of all fuel exports are destined for Europe via the Red Sea lanes.
Shipping companies have rerouted most of the container ships from the region along the coast of South Africa, increasing cost and shipping time.
The container ship rate from Shanghai to Rotterdam surged more than 80% from a year ago at the end of the last week to $3,777 per 40-foot container.
The average composite index for the year-to-date is $3,173 for a 40-foot container, $495 higher than the 10-year average rate of $2,678, according to Drewry's World Container Index.
U.S. Indexes and Yields
The S&P 500 index increased 0.7% to 4,896.23, and the Nasdaq Composite rose 1.1% to 15,599.39.
The yield on 2-year Treasury notes decreased to 4.31%. 10-year Treasury notes declined to 4.10%, and 30-year Treasury bonds edged down to 4.30%.
WTI crude oil increased $0.63 to $75.0 a barrel, and natural gas prices increased 15 cents to $2.60 a thermal unit.
Gold decreased by $13.77 to $2,015.22 an ounce and extended this week's gains after the U.S. dollar drifted slightly lower in international trading.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 102.97.
U.S. Stock Movers
Texas Instruments declined 3% to $168.90 after the company estimated weaker-than-expected revenue and earnings in the first quarter.
The technology company estimated revenue in a range of $3.45 billion to $3.75 billion and earnings per share between 96 cents and $1.16.
Revenue in the fourth quarter declined 13% to $4.0 billion from $4.7 billion, net income plunged 30% to $1.4 billion from $1.97 billion, and diluted earnings per share fell to $1.49 from $2.13 a year ago.
Netflix soared 10.2% to $542.25 after the streaming service provider reported higher-than-expected quarterly revenue and earnings.
Moreover, the company added 13.1 million net new subscribers, increasing the total to 260.8 million paid subscribers, an all-time high.
Revenue in the fourth quarter increased 12.5% to $8.8 billion from $8.5 billion, net income advanced to $938 million from $55 million, and diluted earnings per share rose to $3.73 from 12 cents a year ago.
The company guided a first-quarter revenue increase of 13.2% to $9.2 billion, net income of $1.97 billion, and diluted earnings per share of $4.49.
Alibaba Group Holding gained 2.2% to $75.63 after company insiders acquired additional stakes in the China-based e-commerce giant.
Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.
Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.
The news about the insider's purchase was first reported by the New York Times.
AT&T Inc. declined 3.2% to $16.62 after the telecom company reported weaker-than-expected quarterly results.
European Markets Edged Higher, Eurozone Business Activities Fall
European markets advanced after investors digested a fresh batch of corporate earnings, the business activities report, and Beijing's latest stimulus measures.
Market indexes in Paris, London, and Frankfurt gained in cautious trading amid a flood of corporate earnings reports.
The semiconductor equipment maker ASML reported a higher-than-expected fourth quarter report, SAP estimated a double-digit increase in its cloud computing segment, and Siemens Energy's preliminary quarterly results were ahead of market expectations.
French train maker Alstom reported new orders that exceeded market expectations, but the company missed its quarterly sales outlook.
Private Sector Activities Remain Subdued in the Eurozone
On the economic front, eurozone business activities continued to decline at the beginning of the year, S&P Global reported in its monthly survey on Wednesday.
The HCOB Eurozone PMI Composite Index edged slightly higher to 47.9 in January from 47.6 in December.
The latest data suggested that business activities in the currency zone dropped for the eighth month in a row, but at the slowest pace since last July.
The pace of new incoming orders continued to decline, and the fall in export order growth eased to the slowest pace in nine months, with order backlogs falling sharply.
However, the German private sector contracted at a faster pace in January amid ongoing broad weakness.
The HCOB German PMI Composite Index decreased to 47.1 in January from 47.4 in December.
On the other hand, the UK's private sector activity gained momentum in January, and the S&P Global UK Composite PMI rose to 52.5 in January from 52.1 in December.
Europe Indexes and Yields
The DAX index increased 1.6% to 16,889.92, the CAC-40 index rose 0.9% to 7,455.62, and the FTSE 100 index inched higher by 0.5% to 7,527.67.
The yield on 10-year German bonds edged up to 2.31%; French bonds inched higher to 2.81%; the UK gilts edged higher to 4.01%; and Italian bonds inched lower to 3.86%.
The euro edged lower to $1.090, the British pound inched higher to $1.276, and the U.S. dollar gained to 86.52 Swiss cents.
Brent crude increased $0.42 to $79.97 a barrel, and the Dutch TTF natural gas increased by €1.73 to €28.93 per MWh.
Europe Stock Movers
Alstom SA decreased 5.5% to €11.27 after the French train and mobility solutions provider reported weaker-than-expected fiscal third quarter sales.
SAP SE soared 6% to €158.28 after the German information system company reported fourth-quarter results.
Revenue in the fourth quarter rose 5% to €8.5 billion from €8.0 billion, net profit soared to 1.2 billion from 326 million, and diluted earnings per share rose to €1.01 from 46 cents a year ago.
The company estimated 2024 cloud segment revenue between €17.0 billion and €17.3 billion, an increase between 24% and 27% in constant currencies.
The company said its restructuring, which will involve about 8,000 employees, is likely to cost €2 billion in 2024.
Fresnillo Plc advanced 5.5% to 505.0 pence after the precious metal mining company said silver production rose in 2023.
Siemens Energy increased 7.5% to €13.35 after the company reported better-than-expected fiscal first quarter results.
Tullow Oil advanced 5.1% to 31.74 pence after the company said its 2023 energy production is expected to exceed its previous estimate.
ASML Holding increased 6.3% to €751.80 after the Dutch semiconductor equipment maker reported fourth-quarter earnings ahead of market expectations.
Revenue in the quarter ending in December increased to €7.2 billion from €6.4 billion, net income advanced to €2.0 billion from €1.8 billion, and diluted earnings per share rose to €5.20 from €4.60 a year ago.
Asian Markets Diverge, PoB Cuts RRR
Markets in Asia lacked momentum, and investors focused on local economic data and corporate earnings.
Crude oil traded volatile in international markets, and shipping companies continue to avoid Red Sea Lanes amid ongoing Houthi rebel attacks in the region.
The Houthi attacks are impacting India's petroleum product shipments; about 25% of all fuel exports are destined for Europe via the Red Sea lanes.
Shipping companies have rerouted most of the container ships from the region along the coast of South Africa, increasing cost and shipping time.
The container ship rate from Shanghai to Rotterdam surged more than 80% from a year ago at the end of the last week to $3,777 per 40-foot container.
The average composite index for the year-to-date is $3,173 for a 40-foot container, $495 higher than the 10-year average rate of $2,678, according to Drewry's World Container Index.
Japan Record Third Consecutive Annual Trade Deficit
The Nikkei index decreased 0.8% to 36,221.68 after Japan unexpectedly swung to a trade surplus in December.
Japan's exports rose 9.8% to a new record high of 9.64 trillion yen, and imports fell 6.8% to 9.58 trillion yen, the Ministry of Finance reported Wednesday.
In 2023, exports rose 2.8% to 100.89 trillion yen and imports contracted 7% to 110.18 trillion yen, resulting in a trade deficit of 9.29 trillion yen.
Japan reported a trade deficit for the third year in a row after energy prices soared and exports struggled with weakening global demand.
China Injects Liquidity
The People's Bank of China lowered its bank reserve requirement ratio, or RRR, by 50 basis points to support flagging financial markets and inject liquidity into the financial system.
The central bank lowered its reserve requirement for the first time after cutting it by 25 basis points in September, and the latest cut is expected to add about 1 trillion yuan, or $140 billion, to the financial system.
China Offers Verbal Support to Stabilize Financial Markets
Stocks in China advanced for the second day in a row, and Chinese securities regulators pledged more support to stabilize financial markets.
We are going to put all our efforts into "maintaining the stable operation of the capital market," China Securities Regulatory Commission chairman Yi Huiman said during a meeting on Tuesday, according to the government-controlled Securities Times.
The CSI 300 index added 0.9% to 3,261.97, and the Hang Seng Index advanced 1.6% to 15,606.62.
Alibaba Group soared 5.5% to HK$71.35 after Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.
Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.
India Stocks Rebound, Foreign Investors Lighten Holdings
Stocks lacked direction in early trading, and investors reacted to domestic earnings amid heightened geopolitical tensions in the Middle East.
The Sensex and the Nifty indexes struggled to stay in the positive zone, and banks were in focus after foreign investors lightened holdings in the sector.
Foreign investors have stepped up their selling of stocks in India because of the high valuation and rising U.S. bond yields.
In the last five trading sessions, foreign investors have sold about ₹28,000 crore, or $3.2 billion worth of stocks, according to data available from the exchanges.
The Sensex index decreased 53.25 points to 70,322.71, and the Nifty index fell 14.60 points to 21,224.20.
On the Mumbai stock exchange, 105 stocks traded at their 52-week highs and 21 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds increased to 7.17%, and the Indian rupee edged lower to ₹83.14 against the U.S. dollar.
Tech Rally Powers Nasdaq and S&P 500 Higher
Barry Adams
24 Jan, 2024
New York City
Tech stocks pointed higher and extended weekly gains, and investors reviewed the latest batch of earnings.
The S&P 500 index and the Nasdaq Composite advanced more than 0.5% in Wednesday's trading after Netflix reported sharply higher net subscriber additions.
Mega-cap tech stocks Alphabet, Apple, Amazon, Meta, Microsoft, and Netflix advanced in early trading.
Dupont de Nemours plunged 12.5% to $65.34 after the chemical company reported weak fourth-quarter results and issued a weak outlook for the current quarter.
eBay increased 3.8% to $43.0 after the online marketplace operator announced its plan to lay off 9% of its workforce, or about 1,000 jobs, over the next several months.
Crude oil traded volatile in international markets, and shipping companies continue to avoid Red Sea Lanes amid ongoing Houthi rebel attacks in the region.
The Houthi attacks are impacting India's petroleum product shipments; about 25% of all fuel exports are destined for Europe via the Red Sea lanes.
Shipping companies have rerouted most of the container ships from the region along the coast of South Africa, increasing cost and shipping time.
The container ship rate from Shanghai to Rotterdam surged more than 80% from a year ago at the end of the last week to $3,777 per 40-foot container.
The average composite index for the year-to-date is $3,173 for a 40-foot container, $495 higher than the 10-year average rate of $2,678, according to Drewry's World Container Index.
U.S. Indexes and Yields
The S&P 500 index increased 0.6% to 4,923.15, and the Nasdaq Composite rose 0.9% to 15,575.48.
The yield on 2-year Treasury notes decreased to 4.31%. 10-year Treasury notes declined to 4.10%, and 30-year Treasury bonds edged down to 4.30%.
WTI crude oil increased $0.34 to $74.76 a barrel, and natural gas prices increased 8 cents to $2.53 a thermal unit.
Gold increased by $4.61 to $2,033.34 an ounce and extended this week's gains after the U.S. dollar drifted slightly lower in international trading.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 102.97.
U.S. Stock Movers
Texas Instruments declined 3% to $168.90 after the company estimated weaker-than-expected revenue and earnings in the first quarter.
The technology company estimated revenue in a range of $3.45 billion to $3.75 billion and earnings per share between 96 cents and $1.16.
Revenue in the fourth quarter declined 13% to $4.0 billion from $4.7 billion, net income plunged 30% to $1.4 billion from $1.97 billion, and diluted earnings per share fell to $1.49 from $2.13 a year ago.
Netflix soared 10.2% to $542.25 after the streaming service provider reported higher-than-expected quarterly revenue and earnings.
Moreover, the company added 13.1 million net new subscribers, increasing the total to 260.8 million paid subscribers, an all-time high.
Revenue in the fourth quarter increased 12.5% to $8.8 billion from $8.5 billion, net income advanced to $938 million from $55 million, and diluted earnings per share rose to $3.73 from 12 cents a year ago.
The company guided a first-quarter revenue increase of 13.2% to $9.2 billion, net income of $1.97 billion, and diluted earnings per share of $4.49.
Alibaba Group Holding gained 2.2% to $75.63 after company insiders acquired additional stakes in the China-based e-commerce giant.
Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.
Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.
The news about the insider's purchase was first reported by the New York Times.
AT&T Inc. declined 3.2% to $16.62 after the telecom company reported weaker-than-expected quarterly results.
U.S. Movers: Alibaba, AT&T, Netflix, Texas Instruments
Scott Peters
24 Jan, 2024
New York City
ASML Holding increased 6.3% to €751.80 after the Dutch semiconductor equipment maker reported fourth-quarter earnings ahead of market expectations.
Revenue in the quarter ending in December increased to €7.2 billion from €6.4 billion, net income advanced to €2.0 billion from €1.8 billion, and diluted earnings per share rose to €5.20 from €4.60 a year ago.
SAP SE soared 6% to €158.28 after the German information system company reported fourth-quarter results.
Revenue in the fourth quarter rose 5% to €8.5 billion from €8.0 billion, net profit soared to 1.2 billion from 326 million, and diluted earnings per share rose to €1.01 from 46 cents a year ago.
The company estimated 2024 cloud segment revenue between €17.0 billion and €17.3 billion, an increase between 24% and 27% in constant currencies.
The company said its restructuring, which will involve about 8,000 employees, is likely to cost €2 billion in 2024.
Texas Instruments declined 3% to $168.90 after the company estimated weaker-than-expected revenue and earnings in the first quarter.
The technology company estimated revenue in a range of $3.45 billion to $3.75 billion and earnings per share between 96 cents and $1.16.
Revenue in the fourth quarter declined 13% to $4.0 billion from $4.7 billion, net income plunged 30% to $1.4 billion from $1.97 billion, and diluted earnings per share fell to $1.49 from $2.13 a year ago.
Netflix soared 10.2% to $542.25 after the streaming service provider reported higher-than-expected quarterly revenue and earnings.
Moreover, the company added 13.1 million net new subscribers, increasing the total to 260.8 million paid subscribers, an all-time high.
Revenue in the fourth quarter increased 12.5% to $8.8 billion from $8.5 billion, net income advanced to $938 million from $55 million, and diluted earnings per share rose to $3.73 from 12 cents a year ago.
The company guided a first-quarter revenue increase of 13.2% to $9.2 billion, net income of $1.97 billion, and diluted earnings per share of $4.49.
Alibaba Group Holding gained 2.2% to $75.63 after company insiders acquired additional stakes in the China-based e-commerce giant.
Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.
Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.
The news about the insider's purchase was first reported by the New York Times.
AT&T Inc. declined 3.2% to $16.62 after the telecom company reported weaker-than-expected quarterly results.
Europe Movers: ASML, Alstom, Fresnillo, Siemens Energy, SAP, Tullow Oil
Inga Muller
24 Jan, 2024
Frankfurt
European markets advanced in cautious trading after positive corporate results supported market enthusiasm.
The DAX index increased 1.0% to 16,792.86, the CAC-40 index rose 0.5% to 7,425.52, and the FTSE 100 index inched higher by 0.3% to 7,503.08.
The yield on 10-year German bonds edged up to 2.31%; French bonds inched higher to 2.81%; the UK gilts edged higher to 4.01%; and Italian bonds inched lower to 3.86%.
ASML Holding increased 6.3% to €751.80 after the Dutch semiconductor equipment maker reported fourth-quarter earnings ahead of market expectations.
Revenue in the quarter ending in December increased to €7.2 billion from €6.4 billion, net income advanced to €2.0 billion from €1.8 billion, and diluted earnings per share rose to €5.20 from €4.60 a year ago.
SAP SE soared 6% to €158.28 after the German information system company reported fourth-quarter results.
Revenue in the fourth quarter rose 5% to €8.5 billion from €8.0 billion, net profit soared to 1.2 billion from 326 million, and diluted earnings per share rose to €1.01 from 46 cents a year ago.
The company estimated 2024 cloud segment revenue between €17.0 billion and €17.3 billion, an increase between 24% and 27% in constant currencies.
The company said its restructuring, which will involve about 8,000 employees, is likely to cost €2 billion in 2024.
Alstom SA decreased 5.5% to €11.27 after the French train and mobility solutions provider reported weaker-than-expected fiscal third quarter sales.
Fresnillo Plc advanced 5.5% to 505.0 pence after the precious metal mining company said silver production rose in 2023.
Siemens Energy increased 7.5% to €13.35 after the company reported better-than-expected fiscal first quarter results.
Tullow Oil advanced 5.1% to 31.74 pence after the company said its 2023 energy production is expected to exceed its previous estimate.
Barry Callebaut AG advanced 1% to CHF 1,291.0 after the world's largest chocolate maker reported a slight increase in sales volume in the three months to November.
Sales volume for the quarter to November increased by 0.4% to 580,876 tons from 578,694 a year ago.
Revenue in the quarter increased by 6.2% to CHF 2.24 billion from CHF 2.14 billion a year ago.
Revenue in local currencies rose 14.1%.
Barry Callebaut reiterated its fiscal year guidance of flat volume and flat operating earnings.
During the fiscal quarter, prices of cocoa increased 68%, sugar advanced 40%, and dairy fell 26% from a year ago, respectively.
European Markets Edged Higher, Eurozone Business Activities Fall
Bridgette Randall
24 Jan, 2024
Frankfurt
European markets advanced after investors digested a fresh batch of corporate earnings, the business activities report, and Beijing's latest stimulus measures.
Market indexes in Paris, London, and Frankfurt gained in cautious trading amid a flood of corporate earnings reports.
The semiconductor equipment maker ASML reported a higher-than-expected fourth quarter report, SAP estimated a double-digit increase in its cloud computing segment, and Siemens Energy's preliminary quarterly results were ahead of market expectations.
French train maker Alstom reported new orders that exceeded market expectations, but the company missed its quarterly sales outlook.
Private Sector Activities Remain Subdued in the Eurozone
On the economic front, eurozone business activities continued to decline at the beginning of the year, S&P Global reported in its monthly survey on Wednesday.
The HCOB Eurozone PMI Composite Index edged slightly higher to 47.9 in January from 47.6 in December.
The latest data suggested that business activities in the currency zone dropped for the eighth month in a row, but at the slowest pace since last July.
The pace of new incoming orders continued to decline, and the fall in export order growth eased to the slowest pace in nine months, with order backlogs falling sharply.
However, the German private sector contracted at a faster pace in January amid ongoing broad weakness.
The HCOB German PMI Composite Index decreased to 47.1 in January from 47.4 in December.
On the other hand, the UK's private sector activity gained momentum in January, and the S&P Global UK Composite PMI rose to 52.5 in January from 52.1 in December.
China Injects Liquidity
In other economic news, the People's Bank of China lowered its bank reserve requirement ratio, or RRR, by 50 basis points to support flagging financial markets and inject liquidity into the financial system.
The central bank lowered its reserve requirement for the first time after cutting it by 25 basis points in September, and the latest cut is expected to add about 1 trillion yuan, or $140 billion, to the financial system.
Europe Indexes and Yields
The DAX index increased 1.0% to 16,792.86, the CAC-40 index rose 0.5% to 7,425.52, and the FTSE 100 index inched higher by 0.3% to 7,503.08.
The yield on 10-year German bonds edged up to 2.31%; French bonds inched higher to 2.81%; the UK gilts edged higher to 4.01%; and Italian bonds inched lower to 3.86%.
The euro edged lower to $1.090, the British pound inched higher to $1.276, and the U.S. dollar gained to 86.52 Swiss cents.
Brent crude increased $0.39 to $79.94 a barrel, and the Dutch TTF natural gas increased by €0.77 to €28.0 per MWh.
Europe Stock Movers
Alstom SA decreased 5.5% to €11.27 after the French train and mobility solutions provider reported weaker-than-expected fiscal third quarter sales.
SAP SE soared 6% to €158.28 after the German information system company reported fourth-quarter results.
Revenue in the fourth quarter rose 5% to €8.5 billion from €8.0 billion, net profit soared to 1.2 billion from 326 million, and diluted earnings per share rose to €1.01 from 46 cents a year ago.
The company estimated 2024 cloud segment revenue between €17.0 billion and €17.3 billion, an increase between 24% and 27% in constant currencies.
The company said its restructuring, which will involve about 8,000 employees, is likely to cost €2 billion in 2024.
Fresnillo Plc advanced 5.5% to 505.0 pence after the precious metal mining company said silver production rose in 2023.
Siemens Energy increased 7.5% to €13.35 after the company reported better-than-expected fiscal first quarter results.
Tullow Oil advanced 5.1% to 31.74 pence after the company said its 2023 energy production is expected to exceed its previous estimate.
ASML Holding increased 6.3% to €751.80 after the Dutch semiconductor equipment maker reported fourth-quarter earnings ahead of market expectations.
Revenue in the quarter ending in December increased to €7.2 billion from €6.4 billion, net income advanced to €2.0 billion from €1.8 billion, and diluted earnings per share rose to €5.20 from €4.60 a year ago.
Japan Records Third Consecutive Annual Trade Deficit, Alibaba Insiders Increase Stake
Arjun Pandit
24 Jan, 2024
Mumbai
Markets in Asia lacked momentum, and investors focused on local economic data and corporate earnings.
Crude oil traded volatile in international markets, and shipping companies continue to avoid Red Sea Lanes amid ongoing Houthi rebel attacks in the region.
The Houthi attacks are impacting India's petroleum product shipments; about 25% of all fuel exports are destined for Europe via the Red Sea lanes.
Shipping companies have rerouted most of the container ships from the region along the coast of South Africa, increasing cost and shipping time.
The container ship rate from Shanghai to Rotterdam surged more than 80% from a year ago at the end of the last week to $3,777 per 40-foot container.
The average composite index for the year-to-date is $3,173 for a 40-foot container, $495 higher than the 10-year average rate of $2,678, according to Drewry's World Container Index.
Japan Record Third Consecutive Annual Trade Deficit
The Nikkei index decreased 0.8% to 36,221.68 after Japan unexpectedly swung to a trade surplus in December.
Japan's exports rose 9.8% to a new record high of 9.64 trillion yen, and imports fell 6.8% to 9.58 trillion yen, the Ministry of Finance reported Wednesday.
In 2023, exports rose 2.8% to 100.89 trillion yen and imports contracted 7% to 110.18 trillion yen, resulting in a trade deficit of 9.29 trillion yen.
Japan reported a trade deficit for the third year in a row after energy prices soared and exports struggled with weakening global demand.
China Offers Verbal Support to Stabilize Financial Markets
Stocks in China advanced for the second day in a row, and Chinese securities regulators pledged more support to stabilize financial markets.
We are going to put all our efforts into "maintaining the stable operation of the capital market," China Securities Regulatory Commission chairman Yi Huiman said during a meeting on Tuesday, according to the government-controlled Securities Times.
The CSI 300 index added 0.9% to 3,261.97, and the Hang Seng Index advanced 1.6% to 15,606.62.
Alibaba Group soared 5.5% to HK$71.35 after Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.
Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.
India Stocks Rebound, Foreign Investors Lighten Holdings
Stocks lacked direction in early trading, and investors reacted to domestic earnings amid heightened geopolitical tensions in the Middle East.
The Sensex and the Nifty indexes struggled to stay in the positive zone, and banks were in focus after foreign investors lightened holdings in the sector.
Foreign investors have stepped up their selling of stocks in India because of the high valuation and rising U.S. bond yields.
In the last five trading sessions, foreign investors have sold about ₹28,000 crore, or $3.2 billion worth of stocks, according to data available from the exchanges.
The Sensex index decreased 53.25 points to 70,322.71, and the Nifty index fell 14.60 points to 21,224.20.
On the Mumbai stock exchange, 105 stocks traded at their 52-week highs and 21 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds increased to 7.17%, and the Indian rupee edged lower to ₹83.14 against the U.S. dollar.
India Movers: Axis Bank, Karnataka Bank, REC, Zee Entertainment
Arun Goswami
24 Jan, 2024
Mumbai
Stocks on Dalal Street rebounded after power sector stocks led the gainers.
Banks remained in focus after Axis Bank and Karnataka Bank reported weakening net interest margin.
The Sensex index decreased 53.25 points to 70,322.71, and the Nifty index fell 14.60 points to 21,224.20.
On the Mumbai stock exchange, 216 stocks traded at their 52-week highs and 25 stocks traded at their 52-week lows.
REC Limited jumped 6.4% to ₹464.50 after the power company reported stronger-than-expected quarterly results.
Revenue in the December quarter rose 21% to ₹4,350 crore, and net income advanced 13% to ₹3,269 crore from a year ago, respectively.
Axis Bank decreased 2.4% to ₹1,063.0 after the financial services company reported weaker-than-expected quarterly results.
Net income in the December quarter increased 4% to 6,071 crore, and the net interest margin decreased 10 basis points to 4.01%.
Karnataka Bank dropped 9.5% to ₹241.50 after the regional bank reported a decline in its net interest margin in its latest quarter.
Net income in the December quarter rose 10% to 3331 crore, the net interest margin eased 35 basis points to 3.46%, and the net non-performing asset ratio inched lower by 11 basis points to 1.55%.
Zee Entertainment Enterprises rebounded 2.5% to ₹159.80 and recovered from a 31% fall in the previous session after Sony Pictures Network canceled its plan to acquire the company.
U.S. Major Averages Struggle After Mixed Earnings
Barry Adams
23 Jan, 2024
New York City
U.S. stocks were little changed in early trading, and investors turned cautious after three leading indexes hovered near record highs.
The Dow Jones Industrial Average surpassed 38,000 for the first time in Monday's trading, and the S&P 500 and the Nasdaq 100 traded near their record highs.
But the Dow was down today after 3M fell more than 10% following its weaker-than-expected quarterly and annual earnings outlook.
Earnings dominated trading today, and DR Horton dropped 10% after the home builder reported weaker-than-expected quarterly earnings. GE eased after the company's first quarter earnings estimate fell short of market expectations.
Crude oil was in focus after the U.S. and U.K. carried out additional military strikes targeting Houthi rebel bases in Yemen.
The attacks on Monday, supported by Australia, Bahrain, Canada, and the Netherlands, targeted eight sites used for arms and supply storage and missile surveillance capabilities.
Trading activities across Europe were muted ahead of the European Central Bank's rate decision on Thursday.
Investors are expecting the central bank to hold rates steady and provide more clarity about the future direction of interest rates, despite policymakers pushing back against rate-cut expectations this year.
U.S. Indexes and Yields
The S&P 500 index increased 0.03% to 4,854.75 and the Nasdaq Composite rose 0.2% to 15,383.21.
The yield on 2-year Treasury notes increased to 4.41%. 10-year Treasury notes advanced to 4.13%, and 30-year Treasury bonds edged up to 4.35%.
WTI crude oil decreased $0.66 to $74.09 a barrel, and natural gas prices decreased 1 cents to $2.40 a thermal unit.
Gold increased by $4.65 to $2,025.65 an ounce after declining in the previous week following the general strength in the U.S. dollar.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.40.
U.S. Stock Movers
Airline stocks were higher after United Airlines reported strong fourth quarter results, but the company forecasted a loss in the first quarter after the aviation regulator ordered the grounding of 737 Max 9 planes for emergency inspection following the Alaska Airlines midair door incident.
United Airlines jumped 6% to $40.97.
American Airlines rose 3% to $14.02, and Delta Air Lines advanced 2.4% to $37.85 after United reported strong quarterly results.
General Electric declined 3% to $127.30 after the industrial engineering company estimated weaker-than-expected first quarter results.
The company's fourth-quarter results were ahead of market expectations, but investors focused on the current quarter's business conditions.
Procter & Gamble gained 1.5% to $150.0 after the consumer products maker reported mixed quarterly results.
3M declined 6.6% to $100.86 after the company estimated weak current quarter and full-year earnings estimates.
The diversified conglomerate estimated earnings per share in the first quarter between $2.0 and $2.15 and for the full year between $9.35 and $9.75.
Halliburton Company increased 1.5% to $34.95 after the oil field service provider reported mixed quarterly results for its fourth quarter.
Logitech International dropped 6.5% to CHF 77.56 after the computer accessories maker estimated an annual sales decline between 6% and 7%.
Revenue in the fiscal third quarter ending in December declined 1% to $1.26 billion, net income rose to $247.7 million from $140.5 million, and diluted earnings per share rose to $1.57 from 87 cents a year ago.
The company revised its sales outlook for the fiscal year 2024 to range between $4.2 billion and $4.25 billion, a decline between 6% and 7% compared to the previous estimate of between $4.0 and $4.15 billion, a decline between 9% and 12%.
Subdued Trading In Europe, ECB Rate Action Awaited
European markets lacked direction, and investors debated the rate path and the prospect of economic growth and cooler inflation amid global economic uncertainties and elevated geopolitical tensions.
Market indexes in Frankfurt, London, and Paris trade around the flat line, and investors are worried that the European Central Bank may keep higher rates for longer and dash hopes of rate cuts later in the year.
Policymakers are set to announce rate decisions and monetary policy direction on Thursday, and investors are hoping to get more insights about the future rate path.
In Asia, the Bank of Japan held its short-term interest rate at -0.1% and kept the yield around zero on 10-year Japanese government bonds.
The central bank also lowered its 2024 inflation outlook to 2.4% from its previous estimate of 2.8% released in October.
Market indexes in Shanghai and Hong Kong advanced, and the yuan jumped to 7.18 against the U.S. dollar after China's cabinet pledged to take more "forceful" measures to stabilize financial markets.
UK Public Sector Borrowing Declined In December
The UK public sector borrowing fell sharply in December from a year ago and dropped to the lowest level since 2019, the Office for National Statistics reported Tuesday.
Public sector borrowing, excluding public sector banks, dropped to £7.8 billion from £16.2 billion in December.
Total public sector receipts increased 5.9% to £89.5 billion because of higher collection of VAT and income tax, and spending declined 3.4% to £97.3 billion, driven down in part by lower interest payments.
Total borrowing in the nine-month period to December of the current financial year rose by £11.1 billion to £119.1 billion, the fourth highest borrowing in the period on record.
Europe Indexes and Yields
The DAX index decreased 0.4% to 16,627.09, the CAC-40 index fell 0.4% to 7,388.04, and the FTSE 100 index inched down 0.03% to 7,485.73.
The yield on 10-year German bonds edged up to 2.30%; French bonds inched lower to 2.80%; the UK gilts edged higher to 3.93%; and Italian bonds inched higher to 3.87%.
The euro edged lower to $1.088, the British pound inched higher to $1.272, and the U.S. dollar gained to 86.81 Swiss cents.
Brent crude decreased $0.85 to $79.20 a barrel, and the Dutch TTF natural gas increased by €0.04 to €27.23 per MWh.
Europe Stock Movers
Marston's PLC declined 0.2% to 33.25 pence, despite the pub house operator reporting a solid holiday sales increase.
Associated British Foods increased 1.4% to 2,300.0 pence after the company announced its trading update for 16 weeks ending on January 6.
The company said its discount apparel store chain, Primark, benefited from cash-strapped consumers looking for discounts, but added underlying sales growth slowed in the last quarter.
L. M. Ericsson declined a fraction to kr61.26 in Stockholm trading after the telecom equipment maker said challenging market conditions are likely to persist in 2024.
Sanofi SA declined 1.7% to €92.63 after the French pharmaceutical company agreed to acquire the U.S. biotech company Inhibrx Inc. for as much as $2.2 billion.
Inhibrx shareholders will receive $30 in cash for each share held, a contingent value right of $5.0, and 0.25 shares of a new publicly traded company that will retain Inhibrx’s non-INBRX-101 assets, the immuno-oncology drug pipeline.
Sanofi will retain an 8% stake in the new Inhibrx.
Asian Markets Diverged Reflecting Local Realities
Market indexes rebounded in China, accelerated in Japan, and struggled to advance in India in Tuesday's trading.
In overnight trading in New York, the tech-powered rally extended to the second week after investors bid up semiconductor and mega-cap tech stocks.
Crude oil was also in focus after the U.S. and U.K. carried out additional military strikes targeting Houthi rebel bases in Yemen.
The attacks on Monday, supported by Australia, Bahrain, Canada, and the Netherlands, targeted eight sites used for arms and supply storage and missile surveillance capabilities.
Market indexes in Shanghai and Hong Kong advanced, and the yuan jumped to 7.18 against the U.S. dollar after China's cabinet pledged to take more "stronger and more effective" measures to "stabilize financial markets" and "improve market confidence."
Japan Holds Interest Rates
Market indexes in Tokyo advanced after the Bank of Japan held its benchmark interest rate as expected.
The Nikkei 225 Average jumped 1.2% to a new 34-year high of 36,981.80 and extended gains for the third consecutive session.
The Bank of Japan held its short-term lending rate to -0.1% and the yield around zero for 10-year Japanese government bonds by a unanimous vote.
The central bank also lowered its 2024 inflation outlook to 2.4% from its previous estimate of 2.8% released in October.
Market enthusiasm was supported by a higher closing in New York in overnight trading, and tech stocks extended their rally in the second week.
China Stocks Rebound On Stimulus Hopes
The Hang Seng index soared 2.5% to 15,333.01, and tech stocks led the gainers after the indexes rebounded from a near-15-month low.
Chinese policymakers have struggled to provide meaningful support to financial markets after years of reckless spending on infrastructure driven by a surge in government debt.
By some measures, the Chinese government debt-to-GDP ratio is nearing 300%, the highest among large economies in the world.
Pessimism in Chinese markets is not likely to reverse in the near term as Chinese consumers retrench from spending, avoid pumping additional savings into the property market, and increase cash savings in the face of economic and labor market uncertainties.
Earnings Growth Expectations Power India Indexes
Stocks in Mumbai advanced in morning but sold off sharply in the final hour of trading on Tuesday, and the Nifty and Sensex indexes faced heavy selling after investors returned from the Monday holiday.
Travel stocks were in focus after Ram Mandir Pran Pratistha of Ram Temple in Ayodhya.
The religious site is expected to attract as many as 10 crore, or 100 million, travelers to the city in Uttar Pradesh this year.
The Sensex index decreased 1.5% to 70,370.55, and the Nifty index dropped 1.5% to 21,238.80.
On the Mumbai stock exchange, 468 stocks traded at their 52-week highs and 36 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds increased to 7.18%, and the Indian rupee edged lower to ₹83.11 against the U.S. dollar.
In other markets in the region, the KOSPI index in Seoul added 0.4% to 2,473.54, and the ASX200 index in Sydney advanced 0.5% to 7,517.30.
U.S. Movers: 3M, General Electric, Halliburton, Logitech, Procter & Gamble, United Airlines
Scott Peters
23 Jan, 2024
New York City
Airline stocks were higher after United Airlines reported strong fourth quarter results, but the company forecasted a loss in the first quarter after the aviation regulator ordered the grounding of 737 Max 9 planes for emergency inspection following the Alaska Airlines midair door incident.
Revenue in the fourth quarter increased 9.9% to $13.6 billion from $12.4 billion, net income declined 28.8% to $600 million from $843 million, and diluted earnings per share dropped to $1.81 from $2.55 a year ago.
For the full-year 2023, revenue increased 19.5% to $53.7 billion, net income soared nearly four-fold to $2.6 billion, and diluted earnings per share advanced to $7.89 from $2.23 a year ago.
The airline estimated a loss in the first quarter between 85 cents and 35 cents and revenue per available seat mile to be flat from the previous year.
United Airlines jumped 6% to $40.97.
American Airlines rose 3% to $14.02, and Delta Air Lines advanced 2.4% to $37.85 after United reported strong quarterly results.
General Electric declined 3% to $127.30 after the industrial engineering company estimated weaker-than-expected first quarter results.
The company's fourth-quarter results were ahead of market expectations, but investors focused on the current quarter's business conditions.
Total revenue in the fourth quarter increased 15% to $19.4 billion from $16.8 billion, net income declined 28% to $1.6 billion from $2.2 billion, and diluted earnings per share dropped to $1.44 from $1.53 a year ago.
For the first quarter of 2024, GE expects to deliver "high-single-digit" revenue growth, adjusted earnings per share of 60 cents to 65 cents, and free cash flow "in-line with net income growth."
The company repurchased approximately 2.2 million common shares for $0.3 billion in the fourth quarter, bringing the total common shares repurchased under the program in 2023 to approximately 10.6 million shares for $1.1 billion.
In addition, the company redeemed all outstanding preferred stock for $5.8 billion during 2023.
Procter & Gamble gained 1.5% to $150.0 after the consumer products maker reported mixed quarterly results.
3M declined 6.6% to $100.86 after the company estimated weak current quarter and full-year earnings estimates.
Revenue in the fourth quarter was flat at $8.0 billion, net income jumped to $945 million from $541 million, and diluted earnings per share rose to $1.70 from 98 cents a year ago.
The diversified conglomerate estimated earnings per share in the first quarter between $2.0 and $2.15 and for the full year between $9.35 and $9.75.
Halliburton Company increased 1.5% to $34.95 after the oil field service provider reported mixed quarterly results for its fourth quarter.
Logitech International dropped 6.5% to CHF 77.56 after the computer accessories maker estimated an annual sales decline between 6% and 7%.
Revenue in the fiscal third quarter ending in December declined 1% to $1.26 billion, net income rose to $247.7 million from $140.5 million, and diluted earnings per share rose to $1.57 from 87 cents a year ago.
The company revised its sales outlook for the fiscal year 2024 to range between $4.2 billion and $4.25 billion, a decline between 6% and 7% compared to the previous estimate of between $4.0 and $4.15 billion, a decline between 9% and 12%.
U.S. Major Averages Hover Near Record Highs as Earnings Roll In
Barry Adams
23 Jan, 2024
New York City
U.S. stocks were little changed in early trading, and investors turned cautious after three leading indexes hovered near record highs.
The Dow Jones Industrial Average surpassed 38,000 for the first time in Monday's trading, and the S&P 500 and the Nasdaq 100 traded near their record highs.
Airline stocks were higher after United Airlines reported strong fourth quarter results, but the company forecasted a loss in the first quarter after the aviation regulator ordered the grounding of 737 Max 9 planes for emergency inspection following the Alaska Airlines midair door incident.
United Airlines jumped 6% to $40.97.
Crude oil was also in focus after the U.S. and U.K. carried out additional military strikes targeting Houthi rebel bases in Yemen.
The attacks on Monday, supported by Australia, Bahrain, Canada, and the Netherlands, targeted eight sites used for arms and supply storage and missile surveillance capabilities.
Trading activities across Europe were muted ahead of the European Central Bank's rate decision on Thursday.
Investors are expecting the central bank to hold rates steady and provide more clarity about the future direction of interest rates, despite policymakers pushing back against rate-cut expectations this year.
In Asia, the Bank of Japan held its short-term interest rate at -0.1% and kept the yield around zero, with the upper limit near 1% on 10-year Japanese government bonds.
The central bank also lowered its 2024 inflation outlook to 2.4% from its previous estimate of 2.8% released in October.
Market indexes in Shanghai and Hong Kong advanced, and the yuan jumped to 7.18 against the U.S. dollar after China's cabinet pledged to take more "stronger and more effective" measures to "stabilize financial markets" and "improve market confidence."
U.S. Indexes and Yields
The S&P 500 index increased 0.3% to 4,855.85, and the Nasdaq Composite rose 0.5% to 15,381.77.
The yield on 2-year Treasury notes increased to 4.41%. 10-year Treasury notes advanced to 4.13%, and 30-year Treasury bonds edged up to 4.35%.
WTI crude oil decreased $0.63 to $74.11 a barrel, and natural gas prices decreased 2 cents to $2.39 a thermal unit.
Gold increased by $5.22 to $2,026.25 an ounce after declining in the previous week following the general strength in the U.S. dollar.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.40.
U.S. Stock Movers
American Airlines rose 3% to $14.02, and Delta Air Lines advanced 2.4% to $37.85 after United reported strong quarterly results.
General Electric declined 3% to $127.30 after the industrial engineering company estimated weaker-than-expected first quarter results.
The company's fourth-quarter results were ahead of market expectations, but investors focused on the current quarter's business conditions.
Procter & Gamble gained 1.5% to $150.0 after the consumer products maker reported mixed quarterly results.
3M declined 6.6% to $100.86 after the company estimated weak current quarter and full-year earnings estimates.
The diversified conglomerate estimated earnings per share in the first quarter between $2.0 and $2.15 and for the full year between $9.35 and $9.75.
Halliburton Company increased 1.5% to $34.95 after the oil field service provider reported mixed quarterly results for its fourth quarter.
Logitech International dropped 6.5% to CHF 77.56 after the computer accessories maker estimated an annual sales decline between 6% and 7%.
Revenue in the fiscal third quarter ending in December declined 1% to $1.26 billion, net income rose to $247.7 million from $140.5 million, and diluted earnings per share rose to $1.57 from 87 cents a year ago.
The company revised its sales outlook for the fiscal year 2024 to range between $4.2 billion and $4.25 billion, a decline between 6% and 7% compared to the previous estimate of between $4.0 and $4.15 billion, a decline between 9% and 12%.