Market Update
European Markets Trimmed Weekly Losses; France and Germany Confirmed Weakening Inflation
Bridgette Randall
12 Apr, 2024
Frankfurt
European markets advanced in Friday's trading, bond yields declined, and the euro drifted lower.
Benchmark indexes in Frankfurt, Paris, and London advanced after the final reading of the consumer price index confirmed the weakening trend in inflationary pressures.
German consumer price inflation declined to an annual increase of 2.2% in March from 2.5% in February, Destatis said in its final report on Friday.
France's consumer price inflation eased to an annual rise of 2.5% in March from 3.0% in February, INSEE confirmed in its final report on Friday.
Both inflation reports matched previously announced estimates released by the statistical offices of Germany and France.
Spain's consumer price inflation in March decreased to 3.2% after rising to 3.6% in February, the statistical agency INE reported Friday.
Core inflation, which excludes volatile food and energy prices, eased to 3.3% from 3.5% in the previous month.
The UK may have exited a recession after the latest monthly GDP data pointed towards a rebound in economic activity.
The UK's real GDP increased monthly by 0.1% in February, following a revised 0.3% growth in January, the Office for National Statistics reported Friday.
Europe Indexes and Yields
The DAX index increased by 0.9% to 18,109.54, the CAC-40 index rose by 0.9% to 8,096.40, and the FTSE 100 index inched higher by 1.2% to 8,022.34.
For the week, the DAX index decreased 0.7%, the CAC 40 index fell 0.1%, and the FTSE 100 index added 1.5%.
The yield on 10-year German bonds edged down to 2.38%; French bonds inched higher to 2.87%; the UK gilts edged higher to 4.19%; and Italian bonds inched lower to 3.78%.
The euro edged higher to $1.065; the British pound inched higher to $1.245; and the U.S. dollar edged lower to 91.32 Swiss cents.
Brent crude decreased $1.04 to $90.78. a barrel, and the Dutch TTF natural gas rose by €0.57 to €30.09 per MWh.
Europe Stock Mover
Energy stocks advanced after Brent crude oil futures rose above $90 a barrel on speculation that Iran is likely to conduct a retaliatory strike following Israel's attack on its Syrian embassy.
BP plc gained 2.4% to 534.60 pence, and Shell PLC advanced 1.9% to 2,912.86 pence.
Mining companies rose after copper futures extended two-month gains and rose to a two-year high.
Antofagasta jumped 4.3% to 2,314.0 pence, Glencore advanced 3.9% to 479.93, and Anglo American gained 4.1% to 2,211.0 pence.
Societe Generale SA increased 4.8% to €26.43 a day after the company agreed to sell its equipment leasing and financing division to a private equity firm for €1.1 billion.
Mercantile Investment Trust increased 0.9% to 224.50 pence after the company swung to an annual profit.
ThyssenKrupp AG advanced 1.6% to €4.98, after the German steel company announced restructuring of its loss-making Duisburg steel division and significant production capacity cuts.
The company announced its plans to cut annual steel production capacity to between 9.0 and 9.5 million tons from the current capacity of 11.5 million tons.
Japan Stocks Rebound, Yen Drifts to a New 34-year Low
Akira Ito
12 Apr, 2024
Tokyo
Stock market indexes rebounded and extended weekly gains, and the yen drifted to a new 34-year low against the U.S. dollar.
Stock market sentiment was negatively impacted by the persistent decline in the yen, as the Japanese currency drifted to 153.256 in Tokyo trading without prompting government intervention.
The yield on the Japanese government bond rose to 0.8%, reflecting market nervousness and a widening gap with the U.S. and Japan bond yields.
Last month, the Bank of Japan ended its negative rate regime and revised interest rates for the first time since 2007, but that move failed to prop up the yen.
Investors are anticipating a currency market intervention coordinated by the ministry of finance and the Bank of Japan, but any relief to the yen is expected to be short-lived.
Many currency traders in Tokyo are anticipating the yen to extend its 2024 loss of 8.5%, and the embattled currency may drift below 157 against the U.S. dollar.
Moreover, the Chinese yuan has also been approaching its record low of 7.366 against the U.S. dollar, which could further put pressure on the yen.
The Nikkei 225 Stock Average gained 0.3% to 39,572.26, and the Topix index rose 0.4% to 2,759.11.
For the week, the Nikkei added 0.4% and the Topix advanced 1.3%.
In stock trading, tech stocks rebounded, and financial services stocks traded mixed.
Tokyo Electron, Advantest, Sakura Internet, SoftBank, and Lasertec gained between 1.4% and 2.5%.
Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho Financial fell between 0.8% and 1.4%.
Vehicle makers Toyota Motor, Honda Motor, and Subaru gained around 0.5%, but Nissan Motor declined 1.1%.
China Stocks Extend Losses as the Yuan Approaches Record Low
Li Chen
11 Apr, 2024
Hong Kong
Stocks in Shanghai and Hong Kong traded lower ahead of the release of international trade data and protracted weakness in the property market.
Stocks in China have struggled to hold on to gains, powered by the government's market intervention, after the latest economic data highlighted a fragile economic recovery and persistent weakness in the residential property market.
Investors are worried that the central government may force several large state-controlled real estate companies to merge and provide minimum financial support, which may force bond holders to shoulder most of the losses.
Market sentiment was further dented, after the yen drifted to its new 34-year low against the U.S. dollar, putting more pressure on the Chinese yuan.
The Chinese yuan is trading at a five-month low of 7.264 against the U.S. dollar in Shanghai after the People's Bank of China set the midpoint rate at 7.0986, higher than market expectations.
The Chinese yuan is drifting towards a record low after new foreign direct investment flow collapsed in 2023 following rising tensions with the U.S. and foreign investors staying away from Chinese stocks in Hong Kong and Shanghai.
China's foreign direct investment in 2023 plunged 80% from a year ago to $33 billion, the lowest level since 1993.
China's exports are likely to contract around 2% from a year ago in March, after rising 5.6% in the January-February period, according to an informal survey consensus estimate of five economists in Shanghai.
The CSI 300 index declined 0.3% to 3,494.37, and the Hang Seng index dropped 1.7% to 16,799.67.
For the week, the CSI 300 index declined 1.7% and the Hang Seng index dropped 0.8%.
Longfor Group, China Resource Land, China Vanke, New World Development, and China Overseas Land and Development declined between 3% and 5%.
Electric vehicle makers declined due to worries about price competition and lukewarm sales growth expectations.
BYD, Li Auto, Xpeng, and Nio declined between 3% and 6%, while Xiaomi bucked the trend to trade up 2%.
India Movers: Bank of Baroda, Bharti Hexacom, Maharashtra Seamless, TCS, Vodafone Idea
Arun Goswami
12 Apr, 2024
Mumbai
Market averages on Dalal Street traded down in Friday's trading, and trimmed weekly gains in the holiday-shortened week.
The Sensex index decreased by 0.2% to 74,889.64, and the Nifty index edged lower by 0.3% to 22,677.40.
For the week, the Sensex gained 0.9% and the Nifty index advanced 1.4%.
On the Mumbai stock exchange, 36 stocks traded at their 52-week highs, and 3 stocks traded at their 52-week lows.
Vodafone Idea was nearly unchanged at ₹12.90, and the company set the secondary offering dates to raise ₹18,000 crore between April 18 and April 22.
Maharashtra Seamless added 0.2% to ₹902.0, and the company won an order worth ₹674 crore for casing seamless pipes from ONGC.
Bank of Baroda increased 1.8% to ₹270.20, and the financial services company increased its margin lending rate against financial assets by 5 basis points for three tenures.
Margin lending for loans for periods of three months, six months, and one year was revised to 8.45%, 8.65%, and 8.85%, respectively.
Bharti Hexacom is expected to list its share in an initial public offering on the BSE and the NSE on April 12, and traders are expecting a 15% premium to the offer price.
Bharti Hexacom plans to sell 7.5 crore (75 million) shares and raise about ₹4,275 crore, with an offer price range between ₹542 and ₹570 per share.
Tata Consultancy Services rose 0.9% to ₹3,980.75, and the tech services exporter is scheduled to release its March quarter results later today.
TCS is expected to report a sharp rebound in earnings compared to a year ago, following several new contracts and an incremental contribution from the order placed by BSNL.
U.S. Major Averages Rebound and Shake Off Rate Path Worries
Barry Adams
11 Apr, 2024
New York City
Market indexes on Wall Street lacked direction in volatile trading, and investors reviewed the wholesale price inflation report.
The S&P 500 index and the Nasdaq Composite traded sideways in quiet trading as investors reviewed two inflation reports over two days.
The producer price index rose 2.1% from a year ago. In March, it inched higher by 0.2% on the month, the U.S. Bureau of Labor Statistics reported Thursday.
Monthly producer prices rose at the slowest pace in three months, following a 0.6% rise in February and a 0.4% increase in January.
Producer prices increased in March, driven by a 0.3% rise in services, and goods price inflation decreased by 0.1% after rising 1.2% in the previous month.
The core producer price index, which excludes food and energy prices, rose 0.1% on the month and increased 2.4% from a year ago.
On Wednesday, consumer price inflation accelerated to a three-month high.
Consumer price inflation in March accelerated to an annual pace of 3.5% and advanced 0.4% for the month, the U.S. Bureau of Labor Statistics reported Wednesday.
Annual inflation accelerated for the second month in a row to 3.5% in March, up from 3.2% in February and 3.1% in January.
Core inflation, which excludes food and energy prices, held steady at 0.4% from the previous month and rose 3.8% from a year ago in March.
U.S. Indexes and Yields
The S&P 500 index increased 0.5% to 5,184.08, and the Nasdaq Composite rose 0.8% to 16,292.93.
The yield on 2-year Treasury notes edged higher to 4.94%, 10-year Treasury notes inched up to 4.53%, and 30-year Treasury bonds edged up to 4.63%.
WTI crude oil increased $1.23 to $84.98 a barrel, and natural gas prices decreased 8 cents to $1.80 a thermal unit.
Gold increased by $13.22 to $2,349.28 an ounce, and silver rose 10 cents to $28.04.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.11.
U.S. Stock Movers
Vertex Pharmaceuticals edged up 0.6% to $400.0 after the company agreed to acquire Alpine Immune Sciences for $4.9 billion in cash, or about $65 per share.
Alpine Immune soared 36% to $64.21.
CarMax declined 11.7% to $70.05 after the used car retailer reported weaker-than-expected quarterly results.
Regional banks were in focus after Treasury yields advanced following two inflation reports over the last two days.
New York Community Bancorp traded near its low for the year at $2.96, Western Alliance declined 0.1% to $57.32, and MVB Financial dropped 0.3% to $19.78.
ECB Holds Rates Steady for the Fifth Time, Signals Possible Cuts in Future
European market indexes struggled to advance after the European Central Bank held its interest rate steady and signaled possible rate cuts in the future.
Benchmark indexes in Frankfurt, Paris, and London decreased after comments from European Central Bank president Christine Lagarde.
“If the Governing Council’s updated assessment of the inflation outlook, the dynamics of underlying inflation, and the strength of monetary policy transmission were to further increase its confidence that inflation is converging to the target in a sustained manner, it would be appropriate to reduce the current level of monetary policy restriction,” noted the statement released by the Governing Council.
President Lagarde reinforced the view expressed in the statement and stressed that the committee is ready to lower rates if conditions warrant it in the near future.
As widely expected, the ECB held steady for the fifth time in a row, with its main refinancing operation rate at a 22-year high of 4.50% and deposit facility rate at 4.0%.
Inflation has steadily declined to 2.4% in March after peaking at 10.6% in October 2022, largely because of the fall in imported energy prices.
However, service inflation continues to stay elevated at 4%, making it harder for policymakers to bring down inflation below 2%.
Service sector inflation is closely watched by policymakers because about 70% of the labor force is employed in the sector.
Europe Indexes and Yields
The DAX index decreased by 0.8% to 17,954.48, the CAC-40 index fell by 0.3% to 8,023.74, and the FTSE 100 index inched lowerer by 0.5% to 7,923.80.
The yield on 10-year German bonds edged up to 2.45%; French bonds inched higher to 2.93%; the UK gilts edged higher to 4.23%; and Italian bonds inched lower to 3.81%.
The euro edged higher to $1.073; the British pound inched higher to $1.253; and the U.S. dollar edged lower to 91.22 Swiss cents.
Brent crude decreased $0.63 to $89.85. a barrel, and the Dutch TTF natural gas rose by €2.04 to €29.53 per MWh.
Europe Stock Movers
Givaudan SA declined 1.3% to CHF 3,980.0, despite the Swiss fragrance and flavor maker reporting higher first-quarter sales.
Societe Generale increased 0.9% to €25.36 after the French lender agreed to sell its equipment leasing and financing business to BPCE for €1.1 billion.
AstraZeneca PLC rose 1.9% to 10,942.0 pence after the biopharmaceutical company announced its plan to increase its dividend by 7% in 2024.
Publicis Groupe SA added 1.5% to €102.10 after the French advertising company reported organic sales in the first quarter increased by 4.9%, driven by strong performance in all regions.
Yen Weakness and U.S. Rate Path Uncertainty Overshadow Tokyo Trading
Stocks in Tokyo declined following the weakness in New York after the latest inflation report dashed all hopes of an imminent interest rate cut.
Asian markets were on the defensive after the hotter-than-expected U.S. inflation in March dampened the hopes of a rate cut in June.
Investors pared back rate-cut expectations after U.S. inflation accelerated for the third month in a row in March to 3.5%.
Market participants are worried that persistent inflation above the Fed's target rate of 2% may force the Federal Reserve to push rate cuts all the way into 2025, contrary to the Fed's projection of as many as three rate cuts this year.
Japan Stock Movers
The Nikkei 225 Stock Average decreased 0.4% to 39,429.36, and the Topix index increased 0.2% to 2,748.17.
Tech stocks were among the leading decliners, and financial stocks were among the leading gainers in Thursday's trading.
SoftBank, Advantest, Tokyo Electron, Screen Holdings, Disco Corp., and Sakura Internet declined between 1.5% and 4%.
Banks advanced after the yield on 10-year Japanese government bonds rose to 0.85% after investors dialed down U.S. interest rate expectations.
Mitsubishi UFJ, Sumitomo Mitsubishi, and Mizuho Financial rose between 0.3% and 0.5%.
China Indexes Fall On Growing Deflation Worries
Stocks in Shanghai and Hong Kong struggled after the latest inflation data stoked fears of protracted consumer demand weakness.
Investor sentiment was weak on the worry that policymakers may not provide strong enough stimulus to revive aggregate demand, dampening corporate earnings growth.
Property stocks in Hong Kong dropped sharply on the worry that interest rates would remain elevated following the release of U.S. inflation data.
The U.S. consumer price index in March accelerated to 3.5% from a year ago, and core inflation increased to 3.8%.
The overall consumer price index advanced for the third month in a row after dropping to 3.1% in January, denting all hopes of a rate cut in June.
The Hong Kong Monetary Authority follows the interest rate cycle set by the U.S. because the Hong Kong dollar has been pegged to the U.S. dollar since October 17, 1983, with a fixed exchange rate of HK$7.80 per U.S. dollar.
The CSI 300 index increased 0.1% to 3,507.51, and the Hang Seng index decreased 1% to 16,970.12.
China Vanke, Henderson Land Development, New World Development, and Sun Hung Kai declined between 1% and 4%.
China Life, AIA Group, and Prudential PLC fell between 2% and 4%.
Service Sector Drives Producer Price Inflation Higher In March
Brian Turner
11 Apr, 2024
New York City
The producer price index rose 2.1% from a year ago. In March, it inched higher by 0.2% on the month, the U.S. Bureau of Labor Statistics reported Thursday.
Monthly producer prices rose at the slowest pace in three months, following a 0.6% rise in February and a 0.4% increase in January.
Producer prices increased in March, driven by a 0.3% rise in services, and goods price inflation decreased by 0.1% after rising 1.2% in the previous month.
The core producer price index, which excludes food and energy prices, rose 0.1% on the month and increased 2.4% from a year ago.
On Wednesday, consumer price inflation accelerated to a three-month high.
Consumer price inflation in March accelerated to an annual pace of 3.5% and advanced 0.4% for the month, the U.S. Bureau of Labor Statistics reported Wednesday.
Annual inflation accelerated for the second month in a row to 3.5% in March, up from 3.2% in February and 3.1% in January.
Core inflation, which excludes food and energy prices, held steady at 0.4% from the previous month and rose 3.8% from a year ago in March.
U.S. Movers: Alpine Immune, CarMax, Regional Banks, Vertex Pharmaceuticals
Scott Peters
11 Apr, 2024
New York City
Vertex Pharmaceuticals edged up 0.6% to $400.0 after the company agreed to acquire Alpine Immune Sciences for $4.9 billion in cash, or about $65 per share.
Alpine Immune soared 36% to $64.21.
CarMax declined 7.2% to $73.65 after the used car retailer reported weaker-than-expected quarterly results.
Revenue in the fiscal fourth quarter ending in February declined 1.7% to $5.6 billion from $5.7 billion, net income dropped to $50.3 million from $69.0 million, and diluted earnings per share decreased to 32 cents from 44 cents a year ago.
Retail unit sales in the quarter increased 1.3% to 172,057 units from 169,884 units, and wholesale vehicle sales decreased 4% to 115,546 from 120,330.
The average sale price of a used vehicle decreased 2.3% to $25,985 and that of a that of a wholesale vehicle fell 3.2% to $8,034 from $8,297 a year ago, respectively.
The company pushed back its long-term goal of selling 2 million vehicles in a year to between fiscal years 2026 and 2030, citing macroeconomic uncertainties.
The company repurchased 685,600 shares for $49.3 million at the end of the fiscal fourth quarter, and as of February 29, had $2.36 billion available for repurchase under the outstanding authorization.
In fiscal year 2025, the company intends to "modestly accelerate the pace of share repurchases," above the pace that was implemented in the third quarter of fiscal year 2024.
Regional banks were in focus, after Treasury yields advanced following two inflation reports over the last two days.
New York Community Bancorp traded near its low for the year at $2.96, Western Alliance declined 0.1% to $57.32, and MVB Financial dropped 0.3% to $19.78.
U.S. Indexes Trade Volatile After Producer Price Inflation Accelerates to a Three-month High
Barry Adams
11 Apr, 2024
New York City
Stock market indexes were flat in early trading on Thursday, and investors reviewed the producer price index update.
The S&P 500 index and the Nasdaq Composite traded sideways in quiet trading as investors reviewed two inflation reports over two days.
The producer price index rose 2.1% from a year ago. In March, it inched higher by 0.2% on the month, the U.S. Bureau of Labor Statistics reported Thursday.
Monthly producer prices rose at the slowest pace in three months, following a 0.6% rise in February and a 0.4% increase in January.
Producer prices increased in March, driven by a 0.3% rise in services, and goods price inflation decreased by 0.1% after rising 1.2% in the previous month.
The core producer price index, which excludes food and energy prices, rose 0.1% on the month and increased 2.4% from a year ago.
On Wednesday, consumer price inflation accelerated to a three-month high.
Consumer price inflation in March accelerated to an annual pace of 3.5% and advanced 0.4% for the month, the U.S. Bureau of Labor Statistics reported Wednesday.
Annual inflation accelerated for the second month in a row to 3.5% in March, up from 3.2% in February and 3.1% in January.
Core inflation, which excludes food and energy prices, held steady at 0.4% from the previous month and rose 3.8% from a year ago in March.
U.S. Indexes and Yields
The S&P 500 index increased 0.02% to 5,162.49, and the Nasdaq Composite rose 0.3% to 16,238.15.
The yield on 2-year Treasury notes edged higher to 4.94%, 10-year Treasury notes inched up to 4.53%, and 30-year Treasury bonds edged up to 4.63%.
WTI crude oil increased $0.83 to $85.41 a barrel, and natural gas prices decreased 4 cents to $1.83 a thermal unit.
Gold increased by $5.09 to $2,341.46 an ounce, and silver rose 9 cents to $28.02.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.11.
U.S. Stock Movers
CarMax declined 7.2% to $73.65 after the used car retailer reported weaker-than-expected quarterly results.
Vertex Pharmaceuticals edged up 0.6% to $400.0 after the company agreed to acquire Alpine Immune Sciences for $4.9 billion in cash, or about $65 per share.
Alpine Immune soared 36% to $64.21.
Regional banks were in focus after Treasury yields advanced following two inflation reports over the last two days.
New York Community Bancorp traded near its low for the year at $2.96, Western Alliance declined 0.1% to $57.32, and MVB Financial dropped 0.3% to $19.78.
Europe Movers: AstraZeneca, Darktrace, Gerresheimer, Givaudan, Lufthansa, Publicis, Societe Generale
Inga Muller
11 Apr, 2024
Frankfurt
European markets traded sideways ahead of the widely anticipated rate decisions from the European Central Bank and comments from EDB president Christine Lagarde.
Investors are hoping to get more clarity about the rate path and projections of interest rates, economic growth, and inflation rates.
The DAX index decreased by 0.6% to 17,994.90, the CAC-40 index fell by 0.2% to 8,033.83, and the FTSE 100 index inched lower by 0.2% to 7,941.36.
The yield on 10-year German bonds edged up to 2.45%; French bonds inched higher to 2.93%; the UK gilts edged higher to 4.23%; and Italian bonds inched lower to 3.81%.
Givaudan SA declined 1.3% to CHF 3,980.0, despite the Swiss fragrance and flavor maker reporting higher first-quarter sales.
Societe Generale increased 0.9% to €25.36 after the French lender agreed to sell its equipment leasing and financing business to BPCE for €1.1 billion.
AstraZeneca PLC rose 1.9% to 10,942.0 pence after the biopharmaceutical company announced its plan to increase its dividend by 7% in 2024.
Publicis Groupe SA added 1.5% to €102.10 after the French advertising company reported organic sales in the first quarter increased by 4.9%, driven by strong performance in all regions.
Deutsche Lufthansa decreased 2.5% to €6.98 after the state-controlled German airline suspended all flights to Tehran because of the rising tensions in the Middle East.
Gerresheimer AG dropped 4.4% to €6.98 after the German manufacturer of packing products for medication and drug delivery devices reported that its first-quarter income slightly declined.
Darktrace PLC increased 6.3% to 464.90 pence after the cybersecurity and artificial intelligence company returned to revenue growth in its fiscal third quarter.
Revenue increased 26.5% from a year ago to $176.1 million, and annual recurring revenue increased 23.5% at the end of the March quarter to $731.1 million.
The company raised its revenue growth expectation to 25.5%, 50 basis points higher than the upper end of its previously announced range, reflecting strong demand from customers and higher conversion rates.
The company revised its adjusted operating earnings margin to 23% from the minimum of 21% in the previous estimate.
European Markets Trade Sideways with All Ears On ECB President Lagarde Comments
Bridgette Randall
11 Apr, 2024
Frankfurt
European market indexes struggled to advance ahead of monetary policy decisions by the European Central Bank.
Benchmark indexes in Frankfurt, Paris, and London decreased, and investors looked forward to comments from European Central Bank president Christine Lagarde.
The ECB is widely expected to hold its main refinancing operation rate steady at a 22-year high of 4.50% and hold the deposit facility rate at 4.0%.
Inflation has steadily declined to 2.4% in March after peaking at 10.6% in October 2022, largely because of the fall in imported energy prices.
However, service inflation continues to stay elevated at 4%, making it harder for policymakers to bring down inflation below 2%.
Service sector inflation is closely watched by policymakers because about 70% of the labor force is employed in the sector.
Europe Indexes and Yields
The DAX index decreased by 0.6% to 17,994.90, the CAC-40 index fell by 0.2% to 8,033.83, and the FTSE 100 index inched lower by 0.2% to 7,941.36.
The yield on 10-year German bonds edged up to 2.45%; French bonds inched higher to 2.93%; the UK gilts edged higher to 4.23%; and Italian bonds inched lower to 3.81%.
The euro edged higher to $1.073; the British pound inched higher to $1.253; and the U.S. dollar edged lower to 91.22 Swiss cents.
Brent crude decreased $0.69 to $89.89. a barrel, and the Dutch TTF natural gas rose by €1.54 to €29.02 per MWh.
Europe Stock Movers
Givaudan SA declined 1.3% to CHF 3,980.0, despite the Swiss fragrance and flavor maker reporting higher first-quarter sales.
Societe Generale increased 0.9% to €25.36 after the French lender agreed to sell its equipment leasing and financing business to BPCE for €1.1 billion.
AstraZeneca PLC rose 1.9% to 10,942.0 pence after the biopharmaceutical company announced its plan to increase its dividend by 7% in 2024.
Publicis Groupe SA added 1.5% to €102.10 after the French advertising company reported organic sales in the first quarter increased by 4.9%, driven by strong performance in all regions.
Deutsche Lufthansa decreased 2.5% to €6.98 after the state-controlled German airline suspended all flights to Tehran because of the rising tensions in the Middle East.
Gerresheimer AG dropped 4.4% to €6.98 after the German manufacturer of packing products for medication and drug delivery devices reported that its first-quarter income slightly declined.
Darktrace PLC increased 6.3% to 464.90 pence after the cybersecurity and artificial intelligence company returned to revenue growth in its fiscal third quarter.
Revenue increased 26.5% from a year ago to $176.1 million, and annual recurring revenue increased 23.5% at the end of the March quarter to $731.1 million.
The company raised its revenue growth expectation to 25.5%, 50 basis points higher than the upper end of its previously announced range, reflecting strong demand from customers and higher conversion rates.
The company revised its adjusted operating earnings margin to 23% from the minimum of 21% in the previous estimate.
Japan Stocks Decline After Hot U.S. CPI Report, Yen-Tumble Raises Fresh Intervention Risks
Akira Ito
11 Apr, 2024
Tokyo
Stocks in Tokyo declined following the weakness in New York after the latest inflation report dashed all hopes of an imminent interest rate cut.
Asian markets were on the defensive after the hotter-than-expected U.S. inflation in March dampened the hopes of a rate cut in June.
Investors pared back rate-cut expectations after U.S. inflation accelerated for the third month in a row in March to 3.5%.
Market participants are worried that persistent inflation above the Fed's target rate of 2% may force the Federal Reserve to push rate cuts all the way into 2025, contrary to the Fed's projection of as many as three rate cuts this year.
Yen Weakness Prompt Verbal Intervention from the Finance Ministry
The yen continued its decline and approached 153 against the U.S. dollar, the lowest since July 1990, sparking worries about government intervention.
The yen traded at 152.70 against the U.S. dollar in Tokyo at 1:30 p.m. local time.
The latest decline in the yen prompted Finance Minister Shunichi Suzuki to repeat his previous warnings on Thursday, highlighting that excessive currency swings are not desirable and currency markets should reflect economic fundamentals.
Despite the talk of government intervention, any effort by the ministry of finance coordinated with the central bank is largely going to be symbolic and temporary because the longer-term trend for the Japanese yen is still facing downwards.
Investors have been selling yen after the Bank of Japan ended its negative rate regime and lifted its policy rate for the first time since February 2007.
But the BOJ's rate increase to 0.1% failed to sway market participants, as the gap with the U.S. interest rate remains large.
Moreover, U.S. interest rates are likely to stay at the current level of 5.5% amid the persistent inflation rate above 2%.
Higher Commodity Prices Stoke Inflation Fears In Japan
Investors were also on guard after copper, aluminum, and gold traded at new highs following the reports over the last two weeks of strong manufacturing activities in the U.S., Japan, India, and Europe.
Global manufacturing activities have been growing at a steady pace, and China's manufacturing sector growth has improved, supported by better-than-expected exports of manufactured goods.
Japan's Money Supply Expands in March
The M2 money supply in March rose 2.5% to 1,243.9 trillion yen, the Bank of Japan reported Thursday.
M3 money supply increased at a slower pace of 1.8% to 1,596.8 trillion yen, and the L money stock, which includes all forms of money supplied to the economy, rose 2.1% to 2,127.2 trillion yen.
In the first quarter, M2 increased 2.5%, M3 rose 1.8%, and L advanced 2.2% from a year ago, respectively.
Japan Stock Movers
The Nikkei 225 Stock Average decreased 0.4% to 39,429.36, and the Topix index increased 0.2% to 2,748.17.
Tech stocks were among the leading decliners, and financial stocks were among the leading gainers in Thursday's trading.
SoftBank, Advantest, Tokyo Electron, Screen Holdings, Disco Corp., and Sakura Internet declined between 1.5% and 4%.
Banks advanced after the yield on 10-year Japanese government bonds rose to 0.85% after investors dialed down U.S. interest rate expectations.
Mitsubishi UFJ, Sumitomo Mitsubishi, and Mizuho Financial rose between 0.3% and 0.5%.
Persistent Demand Weakness Drags Consumer Price Inflation In China
Li Chen
11 Apr, 2024
Hong Kong
Consumer price inflation rose less than expected, and producer price inflation declined for the eighteenth month in a row.
The consumer price index rose 0.1% from a year ago in March after rising at an annual pace of 0.7% in February, the National Bureau of Statistics reported Thursday.
The inflation index picked up in February because of the slight rebound in demand during the Lunar New Year holiday, when inflation advanced for the first time in six months.
Post-pandemic consumer demand has remained weak for the second year in a row, following worries about job stability and a protracted slump in property prices.
Families in China viewed investing in residential property as a safe bet after prices rose at a steady pace for nearly 25 years. But that began to change over the last eight years.
Property market weakness since 2016 has turned into a full-blown crisis after the zero-covid restrictions halted the completion of several real estate projects and pushed most large developers on the brink of debt defaults.
Core inflation, which excludes volatile food and energy prices, rose 0.6% in the month from a year ago, compared to a 1.2% rise in February and 0.4% growth in January.
Producer price index, a measures of wholesale inflation, eased 2.8% in March from a year ago, faster than the 2.7% annual pace of decline in February.
China has set a target for consumer prices to rise by 3.0%, a lofty goal considering inflation in 2023 was only 0.2%.