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Market Update

Europe Movers: ASML, BE Semi, Hays, Harbour Energy, Hunting, UBS

Inga Muller
24 Aug, 2023
Frankfurt

European stocks headed higher after chipmakers rallied and energy stocks traded volatile.

The DAX index increased 0.3% to 15,779.91, the CAC-40 index increased 0.4% to 7,278.76 and the FTSE 100 index edged higher 0.4% to 7,344.88.

European chipmakers rallied after Nvidia reported record quarterly sales.

ASML Holding NV jumped 0.6% to €630.20, Aixtron SE advanced 1.% to €36.50, BE Semiconductor Industries NV jumped 2.5% to €108.60 and ASM International NV increased 1.7% to €465.15.

UBS Group AG jumped 2.5% to CHF 21.86 after the company said its group company Credit Suisse dropped its plan to list its real estate fund citing weak demand from Swiss investors.

Norwegian Air Shuttle ASA dropped 7% to €0.84 after the discount air carrier reported a decline in second quarter profit.

Harbour Energy PLC declined to 231.60 pence after the company narrowed its production forecast narrowed towards the lower end of its estimate

Hunting Plc decreased 9.6% to 230.0 pence after the company said it plans to sell its non-core production and exploration assets in order to further its business restructuring.

Hays Plc increased 0.3% to 103.60 pence and the recruiting company appointed a new chief executive.

European Markets Rebounded, Crude Oil Dropped to 5-month Low

Bridgette Randall
24 Aug, 2023
Frankfurt

Market indexes in Europe traded higher after chip stocks rallied and tech investors hunted for bargains.

Popular averages in London, Paris and Frankfurt advanced in volatile trading after chipmakers jumped more than 2% on the hopes that the record quarterly results reported by Nvidia are indicative of a broader industry trend.

Traders drove up chipmakers in Europe, Asia and in the U.S.

Market participants also reviewed the volatile trading pattern in the oil and natural gas markets, which has a deeper impact on the inflation path.

Crude oil prices dropped to a four month low on the rising imbalance between demand and supply. China's uneven economic rebound is having a negative impact on the expected demand growth for crude oil.

Moreover, natural gas prices dropped about 4% after talks between union leaders and LNG producers in Australia indicated that a long strike may be averted.

Closer to the region, France's manufacturing confidence index deteriorated to the lowest since January 2021 on weak new orders largely because of weakness in exports and production.

The manufacturing sentiment index declined to 96 in August from 101 in July, the statistical agency INSEE reported Thursday.

Europe Indexes & Yields

The DAX index increased 0.3% to 15,779.91, the CAC-40 index increased 0.4% to 7,278.76 and the FTSE 100 index edged higher 0.4% to 7,344.88.

The yield on 10-year German bonds decreased to 2.51%, French bonds traded lower to 3.06%, the UK gilts edged down to 4.43% and Italian bonds fell to 4.18%.

The euro edged lower to $1.082, the British pound to $1.268 and the U.S. dollar fetched 88.07 Swiss cents.

Natural gas prices traded volatile after local reports showed some progress between the workers' unions and Woodside Energy and Chevron in averting a long strike at LNG terminals.

Brent crude increased $0.26 to $83.46 a barrel and the Dutch TTF natural gas fell €3.91 to €32.88 per MWh.

Europe Stock Movers

European chipmakers rallied after Nvidia reported record quarterly sales.

ASML Holding NV jumped 0.6% to €630.20, Aixtron SE advanced 1.% to €36.50, BE Semiconductor Industries NV jumped 2.5% to €108.60 and ASM International NV increased 1.7% to €465.15.

UBS Group AG jumped 2.5% to CHF 21.86 after the company said its group company Credit Suisse dropped its plan to list its real estate fund citing weak demand from Swiss investors.

Norwegian Air Shuttle ASA dropped 7% to €0.84 after the discount air carrier reported a decline in second quarter profit.

Harbour Energy PLC declined to 231.60 pence after the company narrowed its production forecast narrowed towards the lower end of its estimate

Hunting Plc decreased 9.6% to 230.0 pence after the company said it plans to sell its non-core production and exploration assets in order to further its business restructuring.

Hays Plc increased 0.3% to 103.60 pence and the recruiting company appointed a new chief executive.

Movers: Analog Devices, Foot Locker, Kohl's, Nike, Peloton Interactive

Scott Peters
23 Aug, 2023
New York City

Foot Locker Inc plunged 29.7% to $16.71 after the specialty retailer reported sales declined almost 10% from a year ago and the company also suspended its quarterly dividend.

Peloton Interactive Inc dropped 23.3% to $5.38 after the fitness equipment company reported wider-than-expected and the company forecasted weak sales outlook in its fiscal first quarter.

The company's sales guidance between $580 million and $600 million fell short of market expectations of at least $620 million.

The company also said that the cost of the recent recall also exceeded its estimates and expects additional expenses in the future.

Kohl's Corp rose 4.3% to $26.85 after the department store retailer reported better-than-expected quarterly results.

Nike Inc declined 2.7% to &98.76 and the athletic shoemaker extended losses to the 10th session in a row after Foot Locker reported weaker-than-expected sales.

Analog Devices, Inc rose 0.6% to $177,75 after the company reported fiscal third quarter results that evoked mixed reactions from investors.

Stock recovered from the slump of 5% in pre-market trading after the company forecasted fiscal fourth quarter revenues of $27 billion and adjusted earnings per share of $2.0.

Broader Averages Closed Higher After Tech Stocks Rallied Second Consecutive Day

Barry Adams
23 Aug, 2023
New York City

Market averages rebounded on Wall Street after a rally in tech stocks lifted a narrow list of stocks.

Market averages staged a strong reversal on Wednesday ahead of the widely anticipated earnings from the chipmaker Nvidia Corp.

Nvidia Corp is scheduled to release its earnings after the close and investors are looking for clues about the AI-fueled growth for the company's chipsets.

Treasury yields also edged lower from 16-year highs after the yield on the 10-year Treasury bonds eased to 4.2% from the high of 4.33% two days ago.

The bond yields edged partly lower after a private survey conducted by the S&P Global showed that the Purchasing Managers' Index eased to 50.4 in August, a decline for the third month in a row.

Manufacturing sector contraction deepened in the month and slower service sector growth accompanied by a decline in total new orders for the first time in six months.

New Home Sales Jumped to 17-month High

New home sales in July rose to a seasonally adjusted annual rate of 714,000, the Commerce Department reported Wednesday.

New home sales rose 4.4% from the downwardly revised level in June and 31.5% from a year earlier.

Home builders are sold fewer pre-construction homes as builders cleared inventories.

Homes available for sale totaled 437,000, about 7 months of inventories and new homes sold prior to construction declined by 20,000 to 93,000 and to the low of the year.

The median price of a new home sold declined to $436,700 and the average sales price was $513,000, compared to $478,200 and $564,900 respectively a year earlier.

U.S. Indexes & Yields

The S&P 500 index traded up 1.1% to 4,435.87 and the Nasdaq Composite gained 1.7% to 13,736.19.

The yield on 2-year Treasury notes increased to 5.03%, 10-year Treasury notes inched higher to 4.32% and 30-year Treasury bonds edged up to 4.41%.

West Texas Intermediate crude oil eased to a one-month low and Brent crude oil price fell to the level last seen on August 3.

Crude oil increased $0.42 to $79.71 a barrel and natural gas prices decreased 5 cents to $2.54 a thermal unit.

U.S. Stock Movers

Foot Locker Inc plunged 29.7% to $16.71 after the specialty retailer reported sales declined almost 10% from a year ago and the company also suspended its quarterly dividend.

Peloton Interactive Inc dropped 23.3% to $5.38 after the fitness equipment company reported wider-than-expected and the company forecasted weak sales outlook in its fiscal first quarter.

The company's sales guidance between $580 million and $600 million fell short of market expectations of at least $620 million.

The company also said that the cost of the recent recall also exceeded its estimates and expects additional expenses in the future.

Kohl's Corp rose 4.3% to $26.85 after the department store retailer reported better-than-expected quarterly results.

Nike Inc declined 2.7% to &98.76 and the athletic shoemaker extended losses to the 10th session in a row after Foot Locker reported weaker-than-expected sales.

Analog Devices, Inc rose 0.6% to $177,75 after the company reported fiscal third quarter results that evoked mixed reactions from investors.

Stock recovered from the slump of 5% in pre-market trading after the company forecasted fiscal fourth quarter revenues of $27 billion and adjusted earnings per share of $2.0.

Movers: Cohort, GSK, Ithaca Energy, Nordex, Roche Holdings

Inga Muller
23 Aug, 2023
New York City

Ithaca Energy Plc decreased 3.8% to 157.60 pence after the energy company reported a drop in revenue and earnings in the first-half.

Cohort PLC increased 7% to 517.50 pence after the company's Systems Engineering & Assessment won a £17.5 million contract in the U.K.

Nordex SE jumped 2% to €11.56 after the German wind turbine company secured three contracts from Heitkamp Industrial Solutions GmbH, a German construction subsidiary of Turkish contracting company Ronesans Enerji Holding for 189 MW.

In Sivas, the group will install 7 turbines at the "Kayalar" wind farm (49 MW), while 8 turbines (56 MW) have been ordered for the "Osmancık" project in Çorum.

The largest order is for 12 turbines with a total capacity of 84 MW for the "Sağıluşağı" wind farm in the province of Malatya in Eastern Anatolia.

Roche Holdings AG jumped 4.2% to CHF 263.50 after the company inadvertently published positive lung cancer drug trial data from an interim analysis.

GSK plc rose 1.3% to 1,372.20 pence after the company reported positive results from its first efficacy trial for its shingles vaccine in China.

European Markets Struggled, Business Activities Contraction Accelerated

Bridgette Randall
23 Aug, 2023
Frankfurt

European markets trade sideways and investors were divided about the monetary policy outlook and rate path in the region.

Market indexes in London, Paris and Frankfurt struggled to get their footings following the weak regional business activities.

European market indexes have fallen in the last three weeks in a row on the rising natural gas prices, worries of higher interest rates and rekindling of inflation.

Moreover, investors are also worried about the weak consumer spending growth amid rising prices for essential products and elevated housing costs.

Euro Area Business Activities Dropped at Fastest Pace In Nearly 3 Years

The HCOB Eurozone Composite PMI declined to 47.0 in August from 48.6 in the month ago, according to the preliminary estimate released by Markit Economics.

The latest reading showed the fastest contraction in the region's private sector activity since November 2020.

Manufacturing output contracted at the second-fastest pace over the past 11 years, trailing only to the early COVID-19 lockdowns, and services output fell for the first time since last December.

Total new business inflows fell for a third straight month, with the rate of decline gathering pace to the steepest since November 2020, and the pace of job creation weakened to the lowest since February 2021.

However, Inflationary pressures increased in August, both in terms of average selling prices and input costs.

Finally, companies’ expectations of output levels in the coming year fell for the sixth month in a row, falling to the lowest since last December.

Europe Indexes & Yields

The DAX index decreased 0.08% to 15,693.44, the CAC-40 index decreased 0.1% to 7,233.70 and the FTSE 100 index edged higher 0.7% to 7,323.87.

The yield on 10-year German bonds increased to 2.55%, French bonds traded lower to 3.08%, the UK gilts edged down to 4.53% and Italian bonds decreased to 4.21%.

The euro edged lower to $1.082, the British pound to $1.261 and the U.S. dollar fetched 88.09 Swiss cents.

Natural gas prices traded volatile after local reports showed some progress between the workers' unions and Woodside Energy and Chevron in averting a long strike at LNG terminals.

Brent crude decreased $1.20 to $82.82 a barrel and the Dutch TTF natural gas fell €4.82 to €38.11 per MWh.

Europe Stock Movers

Ithaca Energy Plc decreased 3.8% to 157.60 pence after the energy company reported a drop in revenue and earnings in the first-half.

Cohort PLC increased 7% to 517.50 pence after the company's Systems Engineering & Assessment won a £17.5 million contract in the U.K.

Nordex SE jumped 2% to €11.56 after the German wind turbine company secured three contracts from Heitkamp Industrial Solutions GmbH, a German construction subsidiary of Turkish contracting company Ronesans Enerji Holding for 189 MW.

In Sivas, the group will install 7 turbines at the "Kayalar" wind farm (49 MW), while 8 turbines (56 MW) have been ordered for the "Osmancık" project in Çorum.

The largest order is for 12 turbines with a total capacity of 84 MW for the "Sağıluşağı" wind farm in the province of Malatya in Eastern Anatolia.

Roche Holdings AG jumped 4.2% to CHF 263.50 after the company inadvertently published positive lung cancer drug trial data from an interim analysis.

GSK plc rose 1.3% to 1,372.20 pence after the company reported positive results from its first efficacy trial for its shingles vaccine in China.

Tech Powered Stock Rebound Halted Amid Elevated Treasury Yields

Barry Adams
22 Aug, 2023
New York City

Stocks struggled and lacked direction and U.S. Treasury yields traded near elevated levels last seen 16 years ago.

Market averages lacked yesterday's momentum after investors worried about rising bond yields and its impact on the broader economy and the banking sector.

Higher yields are likely to increase undeclared losses in Treasury securities portfolio held by banks, and the rising rates will only force banks to raise more capital and direct a larger share of profits to bank's capital then for customer loans.

Tech stocks rallied on the expectations of new markets for AI driven devices and demand for advanced semiconductors.

Investors also reviewed the tight market for existing homes in July after home sales dropped to a six-month low.

Home Sales Dropped to 6-month Low In July

Existing home sales declined 2.2% from a year ago to a seasonally adjusted annual rate of 4.07 million, the National Association of Realtors reported Tuesday.

Elevated mortgage rates and limited home inventories are keeping the number of transactions down.

Single-family home sales declined 1.9% to 3.65 million units and condominium and coops dropped 4.5% to 0.45 million.

Median existing home prices rose 1.9% to $406,700, and stayed above $400,000 for the fourth time.

The inventory of existing homes rose 3.7%from the previous month to 1.1 million homes at the end of July, or about 3.3 months of unsold homes at the current monthly sales rate.

U.S. Indexes & Yields

The S&P 500 index traded down 0.3% to 4,387.55 and the Nasdaq Composite gained 0.06% to 13,505.87.

The yield on 2-year Treasury notes increased to 5.03%, 10-year Treasury notes inched higher to 4.32% and 30-year Treasury bonds edged up to 4.41%.

Crude oil increased $0.42 to $79.71 a barrel and natural gas prices decreased 5 cents to $2.54 a thermal unit.

U.S. Stock Movers

Lowe's Companies Inc increased 3.6% to $225.74 after the home improvement retailer reiterated its full-year outlook.

Revenue in the quarter ending on August 4 declined to $24.96 billion from $27.5 billion and net income decreased to $2.67 billion from $2.88 billion and diluted earnings per share fell to $4.56 from $4.68 a year earlier.

Dick's Sporting Goods Inc plunged 24.1% to $111.53 after the sporting goods retailer reported sharply lower earnings per share and the company blamed the shortfall to higher-than-usual theft.

Dick's said fiscal second quarter revenue was $3.22 billion and diluted earnings per share was $2.82, sharply lower than some analysts estimate of as high as $3.79.

The retailer also lowered its annual outlook.

Macy's Inc declined 14.2% to $12.66 after the department store operator reiterated its cautious full-year outlook.

Fabrinet soared 31.5% to $153.66 after the advanced manufacturing company reported better-than-expected quarterly results.

Revenue increased to $655.9 million compared to $587.9 million and net income increased to $60.8 million from $56.2 million and diluted earnings per share rose to $1.65 from $1.51 a year earlier.

Fabrinet's Board of Directors approved the repurchase of up to an additional $47.6 million of the company's ordinary shares, bringing the aggregate authorization under the existing share repurchase program to $294.8 million, with $100 million still available.

Bargain Hunting Lifted European Markets, Natural Gas Prices Surged Again

Bridgette Randall
22 Aug, 2023
Frankfurt

European markets traded higher following a tech rally in U.S. stocks in overnight trading.

Market indexes in London, Paris and Frankfurt advanced as investors reviewed the latest current account balance in the Euro Area.

Investors hunted for bargains in beaten down tech and energy stocks and overlooked rate hike worries and looming economic slowdown.

Euro Area Current Account Swung to Surplus In June

The Euro Area current account surplus surged to 36.8 billion in June from the revised 4.4 billion deficit in the month a year ago, the European Central Bank reported Tuesday.

The current account surplus rose to the highest level since September 2021 after the goods trade account transitioned to a surplus of 42.7 billion from the deficit of 8 billion in the month a year ago.

On the other hand, the primary income swung to a deficit of Є5.6 billion, from a surplus of Є0.4 billion the previous year, while the services surplus shrank to Є12.1 billion from Є18.9 billion.

Considering the first half of the year, the Euro Area registered a current account surplus of Є59.5 billion compared to a deficit of Є42.1 billion in the year earlier.

UK Government Borrowing Remained Elevated In July

UK public sector net borrowing excluding banks increased to £4.3 billion from £0.9 billion a year earlier, the Office for National Statistics reported Tuesday.

The government borrowing has declined in recent years but it was still the fifth largest July borrowing since record keeping began in 1993.

Total spending increased 9.2% to £97.2 billion as central government net investment soared by £15.9 billion, on the account of payments to the Bank of England Asset Purchase Facility Fund from HM Treasury under the indemnity agreement.

Moreover, the interest payable on central government debt increased by £1.5 billion to £7.7 billion, representing the highest interest payable in any July since monthly records began in April 1997.

On the other hand, total government receipts increased 5.4% to £92.9 billion, driven by increases in income and corporate taxes and VAT receipts.

Europe Indexes & Yields

The DAX index increased 1.1% to 15,770.14, the CAC-40 index rose 1.2% to 7,285.79 and the FTSE 100 index edged higher 0.8% to 7,306.02.

The yield on 10-year German bonds increased to 2.66%, French bonds traded higher to 3.19%, the UK gilts edged up to 4.67% and Italian bonds increased to 4.32%.

The euro edged lower to $1.088, the British pound to $1.271 and the U.S. dollar fetched 87.80 Swiss cents.

Brent crude increased $0.72 to $84.01 a barrel and the Dutch TTF natural gas increased €2.57 to €43.35 per MWh.

Europe Stock Movers

Mining companies traded higher after two weeks of volatile trading and investors recalibrated global demand for commodities.

Antofagasta, Anglo American and Glencore jumped between 2% and 6%.

Home builders in London trading also traded higher and Taylor Wimpey and Barratt Developments gained around 2%.

In Paris trading, STMicroelectronics jumped more than 3% and Capgemini, Dassault Systems, Credit Agricole and Essilor advanced more than 1.5% after the broad rally in market lifted large cap stocks.

Tech stocks rallied in Frankfurt and SAP, Infineon and Siemens Energy jumped more than 2%.

Buyers Snap Up Mega-cap Tech Stocks Despite Rising Bond Yields

Barry Adams
21 Aug, 2023
New York City

Tech stocks jumped in Monday's trading despite the yield on 10-year Treasury bonds traded at 16-year high.

Market indexes traded higher after falling for three weeks in a row, largely because of rate hike worries and uneven economic rebound in China.

Those worries were in full display after the U.S. Treasury yields advanced and the yield on 10-year Treasury bonds jumped above 5% for the first time since October and traded at a high not seen since 2007.

On Sunday, the People's Bank of China, Chinese stock market regulator and the agency of the finance ministry together announced the government's intention to offer more financial and regulatory reforms without specifics.

U.S. stocks have been under pressure for the last three weeks after the market rally driven by a narrow list of tech stocks hit valuation worries and longer-for-high rate path worries resurfaced.

Investors are recalibrating their views on the economy, labor market and the Fed's policy stance.

Despite the cooling of inflation, core inflation which excludes food and energy, is significantly higher than the Fed's preferred 2% level.

Investors are divided if the Fed's current stance of lifting rates in 25 basis points increment will bring down inflation to 2%, as most economists forecast a mild and short recession because of strong labor market conditions.

In Monday's trading, investors snapped up large cap tech stocks including Tesla, Microsoft, Meta, Nvidia, Intel and other semiconductor makers despite the rising Treasury bonds yields.

Home builders and real estate developers, energy explorers and refiners and consumer staples were among the leading decliners.

U.S. Indexes & Yields

The S&P 500 index traded up 0.7% to 4,399.77 and the Nasdaq Composite gained 1.6% to 13,497.59.

The yield on 2-year Treasury notes increased to 5.0%, 10-year Treasury notes inched higher to 4.34% and 30-year Treasury bonds edged up to 4.45%.

Crude oil increased $0.22 to $81.02 a barrel and natural gas prices increased 5 cents to $2.60 a thermal unit.

U.S. Stock Movers

Palo Alto Networks Inc jumped 14.5% to $242.84 after the cyber security and network infrastructure company reported better-than-expected quarterly results.

VMware Inc jumped 4.2% to $161.28 after Broadcom said it got the UK's Competition and Market Authority gave its final approval of the purchase of the cloud computing company.

Broadcom Inc jumped 2.4% to $845.25.

Earthstone Energy Inc soared 13.8% to $18.42 after the company agreed to be acquired by Permian Resources in an all-stock deal that valued the company at $4.5 billion, including the company's debt.

Each share of Earthstone common stock will be exchanged for 1.446 shares of Permian Resources common stock.

European Markets Rebounded, German Wholesale Index Cooled

European markets attempted a rebound on Monday after investors set aside worries of rising rates and looming economic slowdown.

Market indexes advanced in London, Paris and Frankfurt and bond yields hovered near recent highs on the worries that a possible rate hike in the U.S. in September could kick off another round of global rate hikes.

But for today, markets advanced after the producer price index in Germany declined more-than-expected 6.0% from a year ago in July, the Federal Statistics Office or Destatis reported Monday.

The larger-than-expected decline in inflation supported the market advance in Germany and in the Euro Area.

Investors also reviewed the latest rate increase in China and regulators promised more reforms on Sunday but failed to provide specifics.

Investors in Europe are looking for a slowdown in consumer spending and exports from manufacturing companies in Germany, France and Italy.

So far, exports from the region to the U.S. and China have held up, supporting the earnings growth outlook in 2023.

But elevated inflation and soaring prices of food, energy and homes have dented consumer appetite for large-ticket items.

On the economic calendar later this week, Italy's current account balance and jobless rate in France are on deck.

Europe Indexes & Yields

The DAX index increased 0.2% to 15,603.28, the CAC-40 index rose 0.5% to 7,198.06 and the FTSE 100 index edged lower 0.01% to 7,257.83.

The yield on 10-year German bonds increased to 2.67%, French bonds traded higher to 3.21%, the UK gilts edged up to 4.69% and Italian bonds increased to 4.36%.

The U.S. dollar traded near a 2-month high after the minutes of the meeting held on July 25-26 raised the prospect of another rate hike at the next policy meeting.

The euro edged lower to $1.091, the British pound to $1.271 and the U.S. dollar fetched 87.90 Swiss cents.

Brent crude decreased $0.53 to $84.24 a barrel and the Dutch TTF natural gas increased €4.37 to €40.78 per MWh.

Europe Stock Movers

In Frankfurt trading, SAP, BMW, MTU Aero Engines, and Infineon Technologies advanced more than 1%.

In London trading, mining stocks advanced after Chinese regulators and the People's Bank of China in a joint declaration announced to offer more financial and regulatory support.

Antofagasta, Anglo American and Glencore gained around 1% on the hopes of more stimulus for the moribund property market.

In Paris trading, luxury stocks were in focus on the hopes of China stimulus.

LVMH, Hermes, Christian Dior, Pernod Ricard, Kering SA and Richemont jumped between 1% and 2%.

Movers: Broadcom, Earthstone Energy, Permian Resources, Palo Alto Networks, VMware

Scott Peters
21 Aug, 2023
New York City

Palo Alto Networks Inc jumped 14.5% to $242.84 after the cyber security and network infrastructure company reported better-than-expected quarterly results.

Revenue in the fiscal fourth quarter ending in July rose 26% to $2.0 billion and net income increased $227.7 million from $3.3 million and diluted earnings per share jumped to 64 cents from 1 cent a year ago.

The company guided fiscal first quarter revenue in the range between $1.82 billion and $1.85 billion and diluted non-GAAP earnings per share between $11.15 and $1.17.

VMware Inc jumped 4.2% to $161.28 after Broadcom said it got the UK's Competition and Market Authority gave its final approval of the purchase of the cloud computing company.

Broadcom Inc jumped 2.4% to $845.25.

Earthstone Energy Inc soared 13.8% to $18.42 after the company agreed to be acquired by Permian Resources in an all-stock deal that valued the company at $4.5 billion, including the company's debt.

Each share of Earthstone common stock will be exchanged for 1.446 shares of Permian Resources common stock.

Tech Stocks Rebound Lift U.S. Markets, 10-year Treasury Yields Jump to 16-year High

Barry Adams
21 Aug, 2023
New York City

Stocks rebounded on the first day of a new week after tech stocks led gainers.

Market indexes traded higher after falling for three weeks in a row, largely because of rate hike worries and uneven economic rebound in China.

Those worries were in full display after the U.S. Treasury yields advanced to new 9-month highs and the yield on 10-year Treasury bonds jumped above 5% for the first time since October and traded at a high not seen since 2007.

U.S. stocks have been under pressure for the last week after the market rally driven by a narrow list of tech stocks hit valuation worries and rate path longer-for-high rate worries resurfaced.

Investors are recalibrating their views on the economy, labor market and the Fed's policy stance.

Despite the cooling of inflation, core inflation which excludes food and energy, is significantly higher than the Fed's preferred 2% level.

U.S. Indexes & Yields

The S&P 500 index traded up 0.5% to 4,389.97 and the Nasdaq Composite gained 1% to 13,430.29.

The yield on 2-year Treasury notes increased to 5.0%, 10-year Treasury notes inched higher to 4.33% and 30-year Treasury bonds edged down to 4.48%.

Crude oil increased $1.86 to $79.11 a barrel and natural gas prices increased 5 cents to $2.60 a thermal unit.

U.S. Stock Movers

Palo Alto Networks Inc jumped 14.5% to $242.84 after the cyber security and network infrastructure company reported better-than-expected quarterly results.

VMware Inc jumped 4.2% to $161.28 after Broadcom said it got the UK's Competition and Market Authority gave its final approval of the purchase of the cloud computing company.

Broadcom Inc jumped 2.4% to $845.25.

Earthstone Energy Inc soared 13.8% to $18.42 after the company agreed to be acquired by Permian Resources in an all-stock deal that valued the company at $4.5 billion, including the company's debt.

Each share of Earthstone common stock will be exchanged for 1.446 shares of Permian Resources common stock.

European Markets Rebounded After German Wholesales Index Cooled

Bridgette Randall
21 Aug, 2023
Frankfurt