22/04/24
FRIDAY IN THE U.S.A.
Wall Street closed lower on Friday as tech plays weighted, adding to recent market woes tied to geopolitical conflicts and sticky inflation.The S&P 500 slipped 0.88% to 4,967.23, below the 5,000 level. The Dow Jones Industrial Average rose 211.02 points, or 0.56%, to finish at 37,986.40, saved by a ?rally of more than 6% in American Express ollowing earnings. The Nasdaq pulled back 2.05% to 15,282.01, as Nvidia tanked.Both the S&P and the Nasdaq clinched their sixth straight negative days, streaks not seen for either since October 2022.Chip stocks were under increasing pressure in afternoon trading, a sign that investors were rotating heavily out of the sector that led the bull market. Nvidia slipped 10%, registering its worst day since March 2020. Super Micro Computer plunged more than 23%.Netflix retreated more than 9% even after quarterly earnings beat on the top and bottom lines. The streamer’s subscribers jumped 16% from the previous year, but it said it would no longer report paid memberships starting in 2025.While tech put downward pressure on the market, investor concerns over intensification of the Middle East conflict following Israel’s limited strike on Iran appeared largely shaken off by Friday’s open.Oil prices briefly spiked more than 3%, but swung between more modest gains and losses in the hours since. Dow futures at one point fell more than 500 points overnight amid fears that the attack was enough to spark a broader war.Those moves come as the S&P 500 posted its worst weekly performance since March 2023 amid growing fears around the path of inflation and monetary policy. With a loss of more than 3%, it was also the large-cap benchmark’s third straight negative week. A chunk of that downward pressure came from tech stocks, as the sector was the worst performing in the S&P 500 in both the day and week. The S&P 500 is now more than 5% off its 52-week high, part of a market pullback that has been largely driven by tempered expectations for rate cuts amid sticky prices. Economists and strategists now see the Fed waiting until at least September to lower the cost of borrowing money.With Friday’s advance, the Dow Jones eked out a gain of 0.01% for the week. That was its first positive week of the last three.The Nasdaq Composite fell 5.5% this week. The tech-heavy index posted its fourth straight down week, its longest negative streak since December 2022. It also marked the Nasdaq’s worst weekly performance since November 2022.
EARLIER TODAY IN APAC
Asia-Pacific markets rebounded from Friday’s sell-off as investors look to fresh data points out of China, Japan and South Korea this week.Japan’s Nikkei 225 rose 0.47%, with the broad based Topix seeing a larger gain of 0.98%. South Korea’s Kospi rose 0.94%, while the small cap Kosdaq advanced 0.10%. In Australia, the ASX 200 started the week 0.85% higher. Hong Kong’s Hang Seng popped 1.99%, while mainland China’s CSI 300 was trading 0.21% lower after the LPR announcement. On Friday, markets in the region tumbled after Israel launched a strike at Iran, causing stocks to fall and safe-haven assets to climb.Electric vehicle giant Tesla slashed prices of its cars globally after its first-quarter deliveries fell for the first time in nearly four years. Reuters reported that the company cut the starting price of its Model 3 in China to 231,900 yuan ($32,000), a reduction by 14,000 yuan. In Germany, Reuters reported the price of the Model 3 rear-wheel-drive was also cut to 40,990 euros ($43,670.75) from 42,990 euros, where the price had been since February. The China and Germany sites reflected the updated prices. There were also price cuts in many other countries in Europe, the Middle East and Africa, a Tesla spokesperson told Reuters.On the Macros Front, China’s central bank left its one- and five-year loan prime rates unchanged at 3.45% and 3.95%, respectively on Monday. The one-year LPR is seen as the peg for most household and corporate loans, while the five-year LPR is the benchmark for most property mortgages. The decision was in line with a Reuters poll which expected both rates to stay unchanged. China’s CSI 300 index gained 1.9% last week.In FX this morning, the Dollar Index was 0.09% lower at 106.058, the Japanese Yen traded at 154.74 per USD while the Euro added 0.07% at 1.0663 USD.Oil Prices retreated during Asian hours with Brent futures giving up 0.93% at 86.48 while US Crude futures were down by 0.97% at 82.33.
LATEST NEWS HEADLINES & TOP STORIES
Honda plans to soon sign a multibillion-dollar commitment to build new EV facilities in Canada.
Goldman’s Australia equities head Mario Argyrides is leaving to join Jefferies, a person familiar said.
The FDIC is working on proposals to ensure that funds holding more than 10% of a bank’s shares remain passive investors, the FT reported.
J&J and Kenvue were ordered to pay $45 million to the family of an Illinois woman who said its talc-based baby powder gave her a fatal cancer, the first verdict against the J&J spinoff.
Tesla slashed prices on its models across China, the US and Europe, while also lowering the price of its Full Self-Driving software by a third in the US. Elon Musk also postponed a trip to India, citing pressing issues at the company. China’s Li Auto immediately responded with discounts and cash rebates on new models.
TikTok’s bracing for a fight should Congress pass a law to force ByteDance to divest its ownership stake. The video app is preparing to remove general counsel Erich Andersen, who was responsible for fending off US concerns about its China links.
The bubble tea phenomenon has created half a dozen billionaires in China. The husband-and-wife founders of Sichuan Baicha Baidao are set to join the list when the country’s No. 3 boba tea chain starts trading this week.
Chinese brokers are dangling coupon rates of more than 40% on “snowball” derivative products after the mainland stock rout, Galaxy Technologies said.
Asking prices for UK homes rose 1.7% year on year in April, their fastest in 12 months, according to Rightmove. The average is now about ￡372,000, approaching the record set in May 2023. Much of the boost is coming from an increase in sellers of large homes.
Oil price uncertainty won’t stop the ECB from moving in June, Francois Villeroy de Galhau said. Policymakers shouldn’t rush into further reductions after the first rate cut, Madis Muller said.
The US House approved $95 billion in aid for Ukraine, Israel and Taiwan in a package that included sanctions on Iran’s oil sector. The Senate plans to vote on the bill this week before Joe Biden signs off. While the funds are expected to reach Ukraine’s military in a matter of weeks, it’s unlikely to turn the tide in the war on its own.
Mideast latest: Benjamin Netanyahu condemned a reported US plan to sanction an ultra-Orthodox army battalion over human rights abuses in the West Bank. Iran’s foreign minister downplayed Israel’s Friday attack. Recep Tayyip Erdogan called for a cease-fire and accelerated aid when he met with Hamas’s leader Saturday.
TODAY's AGENDA
MACROS
09:30 : ECB’s Villeroy speaks (and at 5:30 p.m.)
11:05 : BOE’s Benjamin speaks
14:30 : Chicago Fed National Activity Index
16:00 : Euro-area April Consumer Confidence
17:30 : ECB’s Lagarde speaks
CORPORATE EVENTS
Earnings include SAP, Verizon, Cleveland-Cliffs
AUCTIONS
11:30 : Germany Calls for Bids on Auction of 329-day Bills
11:30 : Germany Calls for Bids on Auction of 147-day Bills
14:50 : France to Sell Up to EU1.8 Billion of 175-day Bills
14:50 : France to Sell Up to EU3.3 Billion of 84-day Bills
14:50 : France to Sell Up to EU2 Billion of 365-day Bills
17:30 : U.S. To Sell USD70 Bln 13-Week Bills
17:30 : U.S. To Sell USD70 Bln 26-Week Bills
领英推荐
LOOKING AHEAD :?
MONDAY?
Eurozone consumer confidence,??
Philippines and US military forces commence annual war games near Taiwan and South China Sea?
ECB President Christine Lagarde speaks
TUESDAY?
Eurozone S&P Global Manufacturing PMI,
S&P Global Services PMI? UK S&P Global,
CIPS Manufacturing PMI
WEDNESDAY?
Australia CPI? Indonesia rate decision?
IBM, Boeing, Meta Platforms earnings
THURSDAY?
Malaysia CPI?
South Korea GDP?
Turkey rate decision?
US GDP, wholesale inventories, initial jobless claims?
Microsoft, Alphabet, Airbus, Caterpillar earnings
FRIDAY?
Japan rate decision, Tokyo CPI, inflation and GDP forecasts?
US personal income and spending,
University of Michigan consumer sentiment?
Exxon Mobil, Chevron earnings