- Arun Goswami
- 16 Sep, 2024
- Mumbai
Stocks in Mumbai opened higher amid optimism about the inflation outlook after the crude oil prices hovered near the 2024's lows.
Bajaj Housing Finance, Tolins Tyres, and Arkade Developers are in focus this week ahead of listing their shares on stock exchanges.
Patanjali Foods decreased 0.5% to ₹1,850.70 after Patanjali Ayurved sold 2.7%, or 97.9 lakh shares, for ₹1,815 crore.
GLG Partners increased its stake in the food product maker by 1.24% through an open market transaction and potentially acquiring shares sold by Patanjali Ayurved.
Zydus Lifesciences declined 0.1% to ₹1,117.15, and the U.S. Food and Drug Administration issued warning letters citing manufacturing lapses at its Gujarat manufacturing unit.
Spicejet increased 2.4% to ₹73.39 after the company received approval from the SEBI to raise as much as 3,000 crore through the sale of securities.
The securities regulator also banned Spice Healthcare, the promoter group-controlled company, from making an open offer to acquire additional shares in the struggling airline.
JSW Energy declined 0.5% to ₹764.0, and the company's subsidiary has commissioned a 300 MW wind power plant in Tuticorin, Tamil Nadu.
Mahanagar Telephone Nigam decreased 3.7% to ₹57.09 after the central government said it will make interest payments on outstanding bonds for the second time.
MTNL also said in a regulatory filing that the Bank of India has classified its loans to the company totaling ₹1,024 crore as non-performing.
The central government has pumped more than ₹3.2 lakh crore into MTNL and BSNL, two state-controlled struggling telecom companies facing severe financial difficulties. over the last five years.
- Scott Peters
- 13 Sep, 2024
- New York City
Boeing declined 2.5% to $158.80 after the workers union rejected the latest agreement with the company and decided to strike.
RH soared 19% to $305.0, and the furniture retailer reported better-than-expected quarterly results.
Net revenue increased 3.6% to $830 million, net income declined to $28.9 million from $76.4 million, and diluted earnings per share were $1.57 from $3.65.
The company estimated revenue to increase between 7% and 9% in the third quarter and adjusted its operating earnings margin between 15% and 16%.
Adobe declined 8.9% to $534.44, and the software company reported better-than-expected fiscal third quarter results, but the company's current quarter outlook fell short of market expectations.
Adobe reported revenue in the quarter increased to $5.41 billion and adjusted earnings per share of $4.65.
Revenue increased 11% to $5.41 billion, net income advanced to $1.7 billion compared to $1.4 billion, and diluted earnings rose to $3.76 from $3.05 from a year ago.
- Barry Adams
- 13 Sep, 2024
- New York City
Stock market indexes traded higher and extended weekly gains as investors debated the future rate path and size of the possible rate next week.
The S&P 500 index and the Nasdaq Composite edged higher and are set to advance for the fifth consecutive session in a row as investors doubled down rate-cut bets.
The S&P 500 index is up 3.5%, and the Nasdaq Composite has advanced 5.3% this week as of market close on Thursday.
Weakening of consumer price inflation in August boosted hopes of a rate cut, but the core inflation rate held steady at 2.8%, well above the Fed's target rate of 2%.
Moreover, crude oil prices have been on the downward slide this year and dropped to this year's low below $66 a barrel, which could lower overall inflation in September.
However, service inflation is above 3% and well-entrenched in the economy, indicating inflation is likely to stay near 3%.
Investors are looking forward to the Fed's policy meeting on September 17 and 18, and the central bank is set to release its economic projections and inflation outlook.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.4% to 5,616.31, the Nasdaq Composite rose 0.3% to 17,626.01, and the Russell 2000 index rose 1.3% to 2,157.09.
The yield on 2-year Treasury notes edged lower to 3.61%, 10-year Treasury notes inched down to 3.66%, and 30-year Treasury bonds inched lower to 3.98%.
WTI crude oil increased $0.79 to $69.77 a barrel, and natural gas prices edged up 4 cents to $2.40 a thermal unit.
Gold rose by $11.41 to $2,569.92 an ounce, and silver increased by $0.16 to $30.08.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 101.08.
U.S. Stock Movers
Boeing declined 2.5% to $158.80 after the workers union rejected the latest agreement with the company and decided to strike.
RH soared 19% to $305.0, and the furniture retailer reported better-than-expected quarterly results.
Net revenue increased 3.6% to $830 million, net income declined to $28.9 million from $76.4 million, and diluted earnings per share were $1.57 from $3.65.
The company estimated revenue to increase between 7% and 9% in the third quarter and adjusted its operating earnings margin between 15% and 16%.
Adobe declined 8.9% to $534.44, and the software company reported better-than-expected fiscal third quarter results.
Adobe reported revenue in the quarter increased to $5.41 billion and adjusted earnings per share of $4.65.
Revenue increased 11% to $5.41 billion, net income advanced to $1.7 billion compared to $1.4 billion, and diluted earnings rose to $3.76 from $3.05 from a year ago.
- Inga Muller
- 13 Sep, 2024
- Frankfurt
Benchmark indexes in France, Germany, and the UK extended weekly gains to 1% a day after the ECB lowered its key lending rates.
France's consumer price inflation was revised lower in August, and the Euro Area industrial output extended weakness to the eighteenth month.
The DAX index increased by 0.5% to 18,617.54; the CAC-40 index rose by 0.3% to 7,457.28; and the FTSE 100 index rose by 0.2% to 8,257.62.
The yield on 10-year German bonds edged higher to 2.13%, French bonds inched lower to 2.83%, the UK gilts edged down to 3.77%, and Italian bonds decreased to 3.51%.
Worldline SA plummeted 19.2% to €6.79, and the payment service provider lowered its revenue and core earnings outlook.
The company also announced the departure of its chief executive, Giles Grapinet.
Mining companies traded higher after copper prices surged in the hopes of higher demand ahead of the National Day Holiday, also known as Golden Week, starting October 1.
Antofagasta declined 0.1% to 1,725.0 pence, Anglo American decreased 0.3% to 2,056.50 pence, and Glencore jumped 0.6% to 374.75 pence.
Unilever plc increased 0.7% to 4,960.0 pence after the consumer products maker launched the second and final phase of its Є1.5 billion stock buyback.
Commerzbank AG advanced 3.2% to €15.47 after the head of the Bundesbank, Joachim Nagel, said that the central bank will closely look at Italy-based UniCredit's plan to acquire the German bank.
- Bridgette Randall
- 13 Sep, 2024
- London
European markets traded higher a day after the European Central Bank lowered its rates, but the central bank provided little clarity about the future rate path.
Benchmark indexes in Paris, London, and Frankfurt edged higher between 0.2% and 0.5%, and bond yield traded down for the fifth session in a row.
The European Central Bank, in a statement released after the rate decisions, confirmed that while inflation is easing, wages are still rising at an elevated pace, which could rekindle inflationary pressures.
In addition, at the press conference after the governing council meeting, ECB president Christine Lagarde provided little clarity about the next steps of the policymakers and added that rate decisions are going to be based on future data flow.
On the economic front, industrial output of the Euro Area declined 2.2% from a year ago in July, Eurostat reported Friday.
Industrial output has been declining since May 2023, barring only January 2024, indicating weak domestic demand overwhelming rising exports.
France's annual consumer price inflation was revised lower to 1.8% from the preliminary estimate of 1.9% and from 2.3% in June, according to an update released by the statistical agency INSEE.
Consumer price inflation in August dropped to the lowest level since July 2021, largely because of weak energy and electricity prices.
Europe Indexes and Yields
The DAX index increased by 0.5% to 18,617.54; the CAC-40 index rose by 0.3% to 7,457.28; and the FTSE 100 index rose by 0.2% to 8,257.62.
The yield on 10-year German bonds edged higher to 2.13%, French bonds inched lower to 2.83%, the UK gilts edged down to 3.77%, and Italian bonds decreased to 3.51%.
The euro edged up to $1.11; the British pound inched higher to $1.31; and the U.S. dollar weakened to 84.78 Swiss cents.
Brent crude increased $0.69 to $72.66 a barrel, and the Dutch TTF natural gas rose by €0.55 to €35.79 per MWh.
Europe Stock Movers
Worldline SA plummeted 19.2% to €6.79, and the payment service provider lowered its revenue and core earnings outlook.
The company also announced the departure of its chief executive, Giles Grapinet.
Mining companies traded higher after copper prices surged in the hopes of higher demand ahead of the National Day Holiday, also known as Golden Week, starting October 1.
Antofagasta declined 0.1% to 1,725.0 pence, Anglo American decreased 0.3% to 2,056.50 pence, and Glencore jumped 0.6% to 374.75 pence.
Unilever plc increased 0.7% to 4,960.0 pence after the consumer products maker launched the second and final phase of its Є1.5 billion stock buyback.
Commerzbank AG advanced 3.2% to €15.47 after the head of the Bundesbank, Joachim Nagel, said that the central bank will closely look at Italy-based UniCredit's plan to acquire the German bank.
- Akira Ito
- 13 Sep, 2024
- Tokyo
Market indexes in Tokyo fell following the continued rise in the yen after hawkish comments from the Bank of Japan official.
The Nikkei 225 stock average declined 0.7% and the Topix index dropped 0.8% after the yen rose to this year's high of 140.50 against the U.S. dollar.
Bank of Japan board member Naoki Tamura said on Thursday that the central bank must lift rates to 1% over the next two years to gradually achieve its target of 2% inflation.
Tamura's comments pressured Japanese equities and rimmed benchmark indexes' weekly gains to between 2% and 3%.
Investors welcomed the European Central Bank's 25 basis points rate cut for the second time in three months and hoped that the U.S. Federal Reserve Bank would follow through with a similar rate cut next week.
Japan Stock Movers
The Nikkei 225 stock average decreased 0.7% to 36,570.74, and the broader Topix index declined 0.8% to 2,573.01.
Tech stocks traded mixed following a rise in the sector in overnight trading in New York.
Advantest increased 1.3% to ¥6,380.0, Screen Holdings fell 1% to ¥9,857.0, Softbank Group fell 1% to ¥8,417.0, and Tokyo Electron advanced 1.6% to ¥23,645.0.
Banks were in focus after the yen traded near this year's high amid a hawkish interest rate outlook.
Mitsubishi UFJ Financial declined 0.6% to ¥1,451.0, Sumitomo Mitsui Financial fell 0.8% to ¥8,982.0, and Mizuho Financial decreased 0.6% to ¥2,813.50.
Diversified conglomerates declined and extended weekly losses to around 2% after the yen continued to drift higher.
Marubeni decreased 0.5% to ¥2,234.50, Mitsui % Co. increased 0.2% to ¥2,891.50, Mitsubishi Corp. fell 0.5% to ¥2,834.50, and Itochu Corp. dropped 1.3% to ¥7,325.0.
- Li Chen
- 13 Sep, 2024
- Hong Kong
Stocks in Shanghai and Hong Kong advanced in Friday's trading amid speculation that the central bank is prepared to lower mortgage rates.
The Hang Seng index advanced 1%, and the mainland-focused CSI 300 index edged higher after property developers jumped.
Lingering worries about weak economic rebound and weakening consumer confidence outweighed optimism about the possible U.S. rate cuts next week.
Investors have stayed on the sidelines amid persistent growth worries, a protracted property market slump,
Market sentiment was boosted after the European Central Bank cut its key lending rate by 25 basis points and held its economic growth and inflation outlook for the current year.
The move was widely anticipated by investors, and investors are hoping that the U.S. Federal Reserve Bank will follow through with at least a similar rate cut after its policy meeting on September 18.
China Stock Movers
The Hang Seng index increased 1.1% to 17,435.42, and the mainland-focused CSI 300 index added 0.2% to 3,176.79.
For the week, the Hang Seng index is down a fraction following the decline of more than 3% in the previous week.
Tech stocks led the gainers in Hong Kong trading following a rebound in the sector on Wall Street in Thursday's trading.
Meituan increased 1.7% to HK $124.40, Alibaba Group decreased 0.4% to HK $83.15, Baidu gained 0.8% to HK $82.25, and Tencent Holdings edged higher 0.4% to HK $374.60.
Xiaomi Corp added 1.4% to HK $19.20, BYD gained 0.5% to HK $240.0, and Li Auto fell 0.7% to HK $73.90.
Mainland-focused property developers advanced on speculation that the People's Bank of China is likely to lower mortgage rates in the coming weeks.
Longfor Group advanced 3.6% to HK $8.07, China Resources Land added 1.3% to HK $19.66, and China Vanke increased 1.3% to HK $3.94.
- Arun Goswami
- 13 Sep, 2024
- Mumbai
Benchmark indexes in Mumbai struggled in Friday's trading and trimmed weekly gains to 2% amid weak global market sentiment.
Industrial production accelerated slightly in July, and inflation in August held nearly steady, but elevated food prices are likely to persist in the months ahead.
The Sensex index decreased by 0.01% to 82,889.88, and the Nifty index edged down by 0.1% to 25,359.15.
On the Mumbai stock exchange, 126 stocks traded at their 52-week highs, and 13 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds inched lower to 6.81%, and the Indian rupee weakened to 83.92 against the U.S. dollar.
Adani Enterprises edged up 1.5% to ₹2,982.35, and the company clarified in a statement that it is not involved in any Swiss court proceedings.
The company released a statement following a report by the U.S.-based controversial short-seller Hindenburg Research stating that the Swiss authorities have frozen $310 million of the company's assets as part of a money laundering and securities forgery investigation, citing newly released Swiss criminal court proceedings.
Hindustan Aeronautics gained 0.8% to ₹4,634.05, and a report suggested that the central government is likely to upgrade the company status to Maharatna from Navratna, providing greater operational and financial flexibility to the management.
Puravankara added 5% to ₹456.95, and the company acquired redevelopment rights for a luxury apartment complex in South Mumbai.
The company plans to redevelop Miami Apartments in the Breach Candy area and also signed a joint development agreement for a land parcel in Electronic City of Bengaluru.
Indian Railway Catering and Tourism Corporation inched higher by 0.5% to ₹936.05, and the Life Insurance Corporation of India increased its stake in the company to 9.3% from 7.28%.
- Alexander Garcia
- 12 Sep, 2024
- Miami
Investors returned to search for tech bargains for the second day in a row and reviewed the latest update on producer price inflation and weekly unemployment claims.
Market indexes have been treading water as investors debated the future rate path and the appropriate size of the rate cut.
The S&P 500 index inched up a fraction, and the Nasdaq Composite advanced 0.3%.
Producer price inflation, a measure of wholesale inflation, advanced 0.2% from the previous month in August, the U.S. Bureau of Labor Statistics reported Thursday.
The rebound in services inflation contributed to the rise from the downwardly revised flat reading in July.
On an annual basis, producer price inflation slowed for the second consecutive month to 1.7% from 2.1% in July.
On Wednesday, investors reviewed that August's consumer price inflation slowed to 2.5%, but the core rate of inflation held steady at 2.8%, highlighting well-entrenched service inflation in the broader economy.
After the release of two inflations, investors dialed down aggressive rate cut expectations of as much as 50% but still held out for a 25 basis rate cut at the end of the two-day meeting on September 18.
Separately, the European Central Bank lowered its key lending rate by 25 basis points for the second time since June, but cited elevated wage pressures as contributing to inflationary pressures.
Initial jobless claims inched higher and stayed well above the weekly average seen earlier in the year.
Initial jobless claims increased 2,000 from the previous week to 230,000 in the week ending September 7.
Meanwhile, continuing claims, which lag initial claims by one week, rose 5,000 to 1.85 million.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.03% to 5,559.32, the Nasdaq Composite rose 0.3% to 17,448.04, and the Russell 2000 index rose 0.8% to 2,120.85.
The yield on 2-year Treasury notes edged higher to 3.67%, 10-year Treasury notes inched up to 3.67%, and 30-year Treasury bonds inched lower to 3.98%.
WTI crude oil increased $2.15 to $69.74 a barrel, and natural gas prices edged up 8 cents to $2.35 a thermal unit.
Gold rose by $34.52 to $2,546.33 an ounce, and silver increased by $0.98 to $29.65.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 101.54.
U.S. Stock Movers
Alaska Air Group declined 0.3% to $39.37, and the regional airline lifted its third quarter profit outlook citing strong demand in the summer travel season.
The company estimated earnings per share to range between $2.15 and $2.25, compared to its previous estimate between $1.40 and $1.60.
Oxford Industries dropped 3.3% to $80.95 after the parent company of retailer Tommy Bahama reported weaker-than-expected quarterly results.
Revenue in the quarter edged slightly lower to $419.9 million from $420.1 million, net income dropped to $40.6 million from $51.4 million, and diluted earnings per share eased to $2.57 from $3.22 a year earlier.
The company declared a cash dividend of 67 cents per share, an increase from 65 cents a year ago.
The company also tightened its fiscal year revenue to range between $1.51 billion and $1.54 billion, compared to $1.57 billion in the fiscal year 2023.
The retailer also estimated GAAP earnings per share in the current fiscal year to range between $6.28 and $6.58, compared to $3.82 in the previous fiscal year.
Moderna plunged 18.1% to $65.11 after the drug company announced its plans to slash its expenses by $1.1 billion by 2027.
The biotech company said it is shifting its priorities after the COVID-19 pandemic and deprioritizing certain drugs, but still anticipates the release of 10 new drugs over the next three years.
European Markets Advanced 1% as the ECB Delivered Expected Rate Cut
European markets rebounded and erased previous two sessions' losses after the European Central Bank cut rate for the second time in three months as inflation cools.
Benchmark indexes in Paris, London, and Frankfurt gained around 1%, and investors reviewed the release of monetary policy decisions and economic projections from the European Central Bank.
The European Central Bank lowered its key lending rates by 25 basis points, as widely anticipated.
The governing council lowered its rates for the second time after lowering rates in June, reflecting the weakening inflation in the currency union.
The main refinancing rate is now fixed at 3.65%, the deposit facility rate at 3.5%, and the marginal lending facility rate at 3.9%.
"The Governing Council today decided to lower the deposit facility rate—the rate through which it steers the monetary policy stance—by 25 basis points.
Based on the Governing Council’s updated assessment of the inflation outlook, the dynamics of underlying inflation, and the strength of monetary policy transmission, it is now appropriate to take another step in moderating the degree of monetary policy restriction," according to the statement from the ECB.
Inflation in the currency union has declined over the last nine months, but the core rate of inflation is still well above the central bank's target rate of 2%.
Moreover, the service sector inflation, still near 3%, has become one of the key drivers of inflation in the currency union and failed to budge over the last few months.
ECB staff projected average inflation at 2.5% in 2024, 2.2% in 2025, and 1.9% in 2026, matching the rates estimated in June.
Core inflation estimates for 2024 and 2025 have been revised slightly higher, reflecting stronger-than-expected service inflation.
Core inflation is now expected to slow from 2.9% to 2.3% in 2025 and 2.0% in 2026.
Europe Indexes and Yields
The DAX index increased by 1.0% to 18,507.64; the CAC-40 index rose by 0.5% to 7,435.07; and the FTSE 100 index rose by 0.6% to 8,240.97.
The yield on 10-year German bonds edged lower to 2.12%, French bonds inched lower to 2.82%, the UK gilts edged down to 3.78%, and Italian bonds increased to 3.53%.
The euro edged down to $1.10; the British pound inched higher to $1.30; and the U.S. dollar gained to 85.40 Swiss cents.
Brent crude increased $1.92 to $72.53 a barrel, and the Dutch TTF natural gas fell by €0.90 to €35.25 per MWh.
Europe Stock Movers
Technology stocks soared in Thursday's trading following a rally in the sector in overnight trading in New York, which also lifted tech-heavy markets in Asia.
ASML jumped 4.3% to €727.80, BE Semiconductor gained 5.3% to €113.20, Infineon Technologies increased 2.9% to €29.72, and STMicroelectronics inched higher 1.2% to €25.75.
Roche Holding declined 2.9% to CHF 261.30 on reports that the Swiss drugmaker's early-stage trial for an obesity drug showed a high rate of temporary side effects.
Santhera Pharmaceuticals decreased 5.2% to CHF 9.22 after the Swiss drug maker posted a first-half loss of CHF 15.3 million.
Nordex SE advanced 1.5% to €14.31 after the German windmill maker won an order from the Danish renewable energy company Orsted for its 43 MW Farranrory windfarm in Ireland.
Banks in London edged higher after the Bank of England, bowing to pressure from local banks, delayed and watered down its banking capital requirement proposal for the second time in less than a year.
Barclays PLC increased 2.1% to 219.80 pence, HSBC Holdings jumped 1.8% to 660.70 pence, Lloyds Banking increased 1.1% to 58.08 pence, and Standard Chartered 765.60 pence.
The Bank of England delayed its increase in tier-1 capital by less than one percentage point to January 2030, down from its previous announcement of three percentage points in December and six percentage points in the earlier directive.
IG Group Holdings plc increased 8% to 967.50 pence, and the online trading firm reported an increase in revenue in its fiscal first quarter.
Trainline PLC jumped 8.7% to 326.40 pence after the online rail ticketing app reported strong first-half results and lifted its annual profit estimate.
Nikkei 225 Soared 3%, Japan's Producer Price Inflation Slowed In August
Japan stocks rebounded and reversed losses in the previous two sessions, and investors reviewed the latest update on inflation and sentiment among large manufacturing companies.
The Nikkei 225 stock average soared more than 3%, and the broader Topix index advanced more than 2% in Thursday's trading, and the yen edged higher to 142.73 against the U.S. dollar.
Producer price index inflation slowed to 2.5% in August from 3.0% in the prior month, the Bank of Japan reported on Thursday.
Producer inflation slowed to the lowest pace since May after the 4% decline in petroleum and coal prices overshadowed a 2.1% increase in food and beverages and a 2.5% rise in electrical machinery.
On a monthly basis, producer price inflation declined 0.2%, its first decline in ten months, indicating a stronger yen and a weaker price of imported petroleum products.
Moreover, sentiment among large Japanese companies jumped 4.5% in the third quarter from a 1% decline in the second quarter, the Cabinet Office reported on Thursday.
The index turned positive for the first time in three quarters despite the Bank of Japan raising rates and signaling possible additional rate hikes in the year.
Market sentiment was also boosted after the crude oil prices traded around a three-year low of $66 a barrel in New York.
Japan imports more than 99% of its crude oil from the Middle Eastern nations, including Saudi Arabia and the United Arab Emirates, and the lower cost of oil weakens domestic inflation.
Investors are also looking forward to the release of monetary policy decisions and economic projections from the European Central Bank later today.
Japan Stock Movers
The Nikkei 225 stock average jumped 3.4% to 36,838.83, and the Topix index advanced 2.4% to 2,591.88.
Tech stocks rebounded sharply, tracking gains in overnight trading in New York.
Softbank jumped 7.6% to ¥8,476.0, Tokyo Electron advanced 4.5% to ¥23,220.0, Advantest Corp. soared 9% to ¥6,283.0, and Screen Holdings added 3.1% to ¥9,949.0.
Industrial machinery and equipment makers jumped more than 5% after the sentiment among large manufacturing companies improved in the third quarter.
Ebara soared 11% to ¥1,901.0, IHI Corp added 9.7% to ¥6,691.0, Kawasaki Heavy Industries jumped 5.6% to ¥4,572.0, and Omron gained 4.8% to ¥6,001.0.
Retailers were in focus after producer price inflation weakened in August.
Seven & I Holdings added 3.7% to ¥2,198.0, Isetan Mitsukoshi increased 1.2% to ¥2,170.0, Aeon Co. Ltd. gained 2.2% to ¥3,906.0, and Fast Retailing jumped 3.6% to ¥44,470.0.
Energy importers and distributors were in focus after crude oil prices hovered near three-year lows amid expectations of lower prices in the fourth quarter.
Eneos Holdings gained 2.3% to ¥738.10, Idemitsu Kosan increased 1.3% to ¥983.20, and Cosmo Energy advanced 3.2% to ¥7,375.0.
Alibaba Leads Hong Kong Stock Rebound, Mainland Indexes Struggle
Hong Kong stocks advanced and Shanghai stocks turned lower amid heightened market volatility in China.
The Hang Seng index jumped 1% on the expectations of a rate cut in Europe later today and in the U.S. next week, but the CSI 300 index struggled amid weak investor sentiment.
The Hang Seng index nearly erased August's 4% advance this month amid worries of an economic slowdown in the U.S.
However, market indexes rebounded in Thursday's trading as investors shifted their focus to monetary policy decisions from the European Central Bank and the U.S. Federal Reserve.
Moreover, crude oil prices hovered around a three-year low of $66 a barrel in New York, amid demand growth worries in China and the U.S.
The accelerated structural shift to renewable energy and faster adoption of electric vehicles in China is likely to curtail future demand for crude oil.
Moreover, China's rapid growth in exports of solar panels, windmills, and electric vehicles to the ASEAN region, Russia, Central Asia, and the rest of the world is also likely to negatively impact global crude oil demand.
Investors remained cautious as the domestic consumer demand remained weak in China amid job market uncertainties and a protracted property market slump.
Moreover, China's leadership has shifted its focus from supporting economic growth to investing in military technologies and modernizing its defense capabilities.
China Stock Movers
The Hang Seng index rebounded 1% to 17,274.72, and the CSI 300 index decreased 0.2% to 3,181.57.
Energy stocks were in focus for the second day in a row after Hurricane Francine made landfall in Louisiana, halting oil refinery operations and crude oil explorations in the Gulf of Mexico.
PetroChina declined 1% to HK $5.55, China Petroleum and Chemical fell 1% to HK $4.24, and CNOOC increased 0.1% to HK $18.0.
In Hong Kong, property developers were in focus ahead of the widely expected rate cut in the U.S. next week.
China Vanke increased 1.3% to HK $3.89, Longfor Holdings Group added 0.6% to HK $7.72, China Overseas Land declined 1.2% to HK $10.96, and Sun Hung Kai advanced 1.4% to HK $77.40.
Following the gains in overnight trading in New York, technology stocks advanced in Hong Kong but struggled in Shanghai and Shenzhen.
Alibaba Group edged up 1.1% to HK $83.50 as mainland investors snapped up HK11.6 billion worth of the company's stock on the first day of trading on the Stock Connect.
Tencent Holdings added 1.2% to HK $374.60, Baidu jumped 2.2% to HK $82.25, and Meituan advanced 4% to HK $124.20.
- Scott Peters
- 12 Sep, 2024
- New York City
Alaska Air Group declined 0.3% to $39.37, and the regional airline lifted its third quarter profit outlook citing strong demand in the summer travel season.
The company estimated earnings per share to range between $2.15 and $2.25, compared to its previous estimate between $1.40 and $1.60.
Oxford Industries dropped 3.3% to $80.95 after the parent company of retailer Tommy Bahama reported weaker-than-expected quarterly results.
Revenue in the quarter edged slightly lower to $419.9 million from $420.1 million, net income dropped to $40.6 million from $51.4 million, and diluted earnings per share eased to $2.57 from $3.22 a year earlier.
The company declared a cash dividend of 67 cents per share, an increase from 65 cents a year ago.
The company also tightened its fiscal year revenue to range between $1.51 billion and $1.54 billion, compared to $1.57 billion in the fiscal year 2023.
The retailer also estimated GAAP earnings per share in the current fiscal year to range between $6.28 and $6.58, compared to $3.82 in the previous fiscal year.
Moderna plunged 18.1% to $65.11 after the drug company announced its plans to slash its expenses by $1.1 billion by 2027.
The biotech company said it is shifting its priorities after the COVID-19 pandemic and deprioritizing certain drugs, but still anticipates the release of 10 new drugs over the next three years.
Nvidia rose 2.4% to $119.67, and the company's chief executive said at a conference organized by Goldman Sachs that the demand for its advanced AI chip Blackwell is strong.
CEO Jensen Huang said that the company will start selling the chip in the fourth quarter and scale it in the quarter and into the next year.
- Barry Adams
- 12 Sep, 2024
- New York City
U.S. stocks advanced, and tech stocks continued to lead gainers for the second day in a row on Wall Street.
The S&P 500 index inched up 0.01%, and the Nasdaq Composite advanced 0.2%.
Producer price inflation, a measure of wholesale inflation, advanced 0.2% from the previous month in August, the U.S. Bureau of Labor Statistics reported Thursday.
The rebound in services inflation contributed to the rise from the downwardly revised flat reading in July.
On an annual basis, producer price inflation slowed for the second consecutive month to 1.7% from 2.1% in July.
On Wednesday, investors reviewed that August's consumer price inflation slowed to 2.5%, but the core rate of inflation held steady at 2.8%, highlighting well-entrenched service inflation in the broader economy.
After the release of two inflations, investors dialed down aggressive rate cut expectations of as much as 50% but still held out for a 25 basis rate cut at the end of the two-day meeting on September 18.
Separately, the European Central Bank lowered its key lending rate by 25 basis points for the second time since June, but cited elevated wage pressures as contributing to inflationary pressures.
Initial jobless claims inched higher and stayed well above the weekly average seen earlier in the year.
Initial jobless claims increased 2,000 from the previous week to 230,000 in the week ending September 7.
Meanwhile, continuing claims, which lag initial claims by one week, rose 5,000 to 1.85 million.
U.S. Indexes and Treasury Yields
The S&P 500 index decreased 0.3% to 5,486.63, the Nasdaq Composite eased 0.4% to 16,960.21, and the Russell 2000 index fell 0.1% to 2,095.90.
The yield on 2-year Treasury notes edged higher to 3.67%, 10-year Treasury notes inched up to 3.67%, and 30-year Treasury bonds inched lower to 3.98%.
WTI crude oil increased $0.92 to $68.22 a barrel, and natural gas prices edged up 1 cent to $2.22 a thermal unit.
Gold rose by $9.06 to $2,520.92 an ounce, and silver increased by $0.13 to $28.80.
The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 101.73.
U.S. Stock Movers
Alaska Air Group declined 0.3% to $39.37, and the regional airline lifted its third quarter profit outlook citing strong demand in the summer travel season.
The company estimated earnings per share to range between $2.15 and $2.25, compared to its previous estimate between $1.40 and $1.60.
Oxford Industries dropped 3.3% to $80.95 after the parent company of retailer Tommy Bahama reported weaker-than-expected quarterly results.
Revenue in the quarter edged slightly lower to $419.9 million from $420.1 million, net income dropped to $40.6 million from $51.4 million, and diluted earnings per share eased to $2.57 from $3.22 a year earlier.
The company declared a cash dividend of 67 cents per share, an increase from 65 cents a year ago.
The company also tightened its fiscal year revenue to range between $1.51 billion and $1.54 billion, compared to $1.57 billion in the fiscal year 2023.
The retailer also estimated GAAP earnings per share in the current fiscal year to range between $6.28 and $6.58, compared to $3.82 in the previous fiscal year.
Moderna plunged 18.1% to $65.11 after the drug company announced its plans to slash its expenses by $1.1 billion by 2027.
The biotech company said it is shifting its priorities after the COVID-19 pandemic and deprioritizing certain drugs, but still anticipates the release of 10 new drugs over the next three years.
- Inga Muller
- 12 Sep, 2024
- Frankfurt
The European Central Bank lowered its key lending rates by 25 basis points, as widely anticipated.
The governing council lowered its rates for the second time after lowering rates in June, reflecting the weakening inflation in the currency union.
The main refinancing rate is now fixed at 3.65%, the deposit facility rate at 3.5%, and the marginal lending facility rate at 3.9%.
"The Governing Council today decided to lower the deposit facility rate—the rate through which it steers the monetary policy stance—by 25 basis points.
Based on the Governing Council’s updated assessment of the inflation outlook, the dynamics of underlying inflation, and the strength of monetary policy transmission, it is now appropriate to take another step in moderating the degree of monetary policy restriction," according to the statement from the ECB.
Banks pay the main refinancing rate to the European Central Bank when they borrow for one week, while the deposit facility rate is paid to the bank when they make an overnight deposit to the Eurosystem.
The marginal facility rate is the interest rate paid by banks when they seek overnight credit from the Eurosystem.
ECB staff projected average inflation at 2.5% in 2024, 2.2% in 2025, and 1.9% in 2026, matching the rates estimated in June.
Core inflation estimates for 2024 and 2025 have been revised slightly higher, reflecting stronger-than-expected service inflation.
Core inflation is now expected to slow from 2.9% to 2.3% in 2025 and 2.0% in 2026.
ECB staff also slightly revised lower its estimate of GDP growth over the next three years, reflecting tight financing conditions and weak consumer demand.
GDP growth in 2024 is expected at 0.8% in 2024, but will increase to 1.3% in 2025 and further improve to 1.5% in 2026.
- Inga Muller
- 12 Sep, 2024
- Frankfurt
European markets jumped around 1% ahead of the widely anticipated rate cut from the European Central Bank.
The Bank of England watered down and delayed its banking overhaul for the second time in a year.
The DAX index increased by 1.2% to 18,556.29; the CAC-40 index rose by 0.9% to 7,461.77; and the FTSE 100 index rose by 0.8% to 8,256.42.
The yield on 10-year German bonds edged lower to 2.12%, French bonds inched lower to 2.82%, the UK gilts edged down to 3.78%, and Italian bonds increased to 3.53%.
Technology stocks soared in Thursday's trading following a rally in the sector in overnight trading in New York, which also lifted tech-heavy markets in Asia.
ASML jumped 4.3% to €727.80, BE Semiconductor gained 5.3% to €113.20, Infineon Technologies increased 2.9% to €29.72, and STMicroelectronics inched higher 1.2% to €25.75.
Roche Holding declined 2.9% to CHF 261.30 on reports that the Swiss drugmaker's early-stage trial for an obesity drug showed a high rate of temporary side effects.
Santhera Pharmaceuticals decreased 5.2% to CHF 9.22 after the Swiss drug maker posted a first-half loss of CHF 15.3 million.
Nordex SE advanced 1.5% to €14.31 after the German windmill maker won an order from the Danish renewable energy company Orsted for its 43 MW Farranrory windfarm in Ireland.
Banks in London edged higher after the Bank of England, bowing to pressure from local banks, delayed and watered down its banking capital requirement proposal for the second time in less than a year.
Barclays PLC increased 2.1% to 219.80 pence, HSBC Holdings jumped 1.8% to 660.70 pence, Lloyds Banking increased 1.1% to 58.08 pence, and Standard Chartered 765.60 pence.
The Bank of England delayed its increase in tier-1 capital by less than one percentage point to January 2030, down from its previous announcement of three percentage points in December and six percentage points in the earlier directive.
IG Group Holdings plc increased 8% to 967.50 pence, and the online trading firm reported an increase in revenue in its fiscal first quarter.
Trainline PLC jumped 8.7% to 326.40 pence after the online rail ticketing app reported strong first-half results and lifted its annual profit estimate.
- Bridgette Randall
- 12 Sep, 2024
- London
European markets rebounded and erased previous two sessions' losses ahead of the widely anticipated interest rate cuts later in the day.
Benchmark indexes in Paris, London, and Frankfurt gained around 1%, and investors awaited the release of monetary policy decisions and economic projections from the European Central Bank.
Investors also looked ahead to comments from ECB President Christine Lagarde to gain insights into the rate path and possible additional rate cuts later in the year.
ECB President Lagarde is scheduled to deliver her comments at 2:45 p.m. Frankfurt time, which could sway trading as the session progresses.
Inflation in the currency union has declined over the last nine months, but the core rate of inflation is still well above the central bank's target rate of 2%.
Moreover, the service sector inflation, still above 3%, has become one of the key drivers of inflation in the currency union and failed to budge over the last few months.
Europe Indexes and Yields
The DAX index increased by 1.2% to 18,556.29; the CAC-40 index rose by 0.9% to 7,461.77; and the FTSE 100 index rose by 0.8% to 8,256.42.
The yield on 10-year German bonds edged lower to 2.12%, French bonds inched lower to 2.82%, the UK gilts edged down to 3.78%, and Italian bonds increased to 3.53%.
The euro edged down to $1.10; the British pound inched higher to $1.30; and the U.S. dollar gained to 85.40 Swiss cents.
Brent crude increased $1.06 to $71.67 a barrel, and the Dutch TTF natural gas fell by €0.62 to €35.54 per MWh.
Europe Stock Movers
Technology stocks soared in Thursday's trading following a rally in the sector in overnight trading in New York, which also lifted tech-heavy markets in Asia.
ASML jumped 4.3% to €727.80, BE Semiconductor gained 5.3% to €113.20, Infineon Technologies increased 2.9% to €29.72, and STMicroelectronics inched higher 1.2% to €25.75.
Roche Holding declined 2.9% to CHF 261.30 on reports that the Swiss drugmaker's early-stage trial for an obesity drug showed a high rate of temporary side effects.
Santhera Pharmaceuticals decreased 5.2% to CHF 9.22 after the Swiss drug maker posted a first-half loss of CHF 15.3 million.
Nordex SE advanced 1.5% to €14.31 after the German windmill maker won an order from the Danish renewable energy company Orsted for its 43 MW Farranrory windfarm in Ireland.
Banks in London edged higher after the Bank of England, bowing to pressure from local banks, delayed and watered down its banking capital requirement proposal for the second time in less than a year.
Barclays PLC increased 2.1% to 219.80 pence, HSBC Holdings jumped 1.8% to 660.70 pence, Lloyds Banking increased 1.1% to 58.08 pence, and Standard Chartered 765.60 pence.
The Bank of England delayed its increase in tier-1 capital by less than one percentage point to January 2030, down from its previous announcement of three percentage points in December and six percentage points in the earlier directive.
IG Group Holdings plc increased 8% to 967.50 pence, and the online trading firm reported an increase in revenue in its fiscal first quarter.
Trainline PLC jumped 8.7% to 326.40 pence after the online rail ticketing app reported strong first-half results and lifted its annual profit estimate.
- Akira Ito
- 12 Sep, 2024
- Tokyo
Japan stocks rebounded and reversed losses in the previous two sessions, and investors reviewed the latest update on inflation and sentiment among large manufacturing companies.
The Nikkei 225 stock average soared more than 3%, and the broader Topix index advanced more than 2% in Thursday's trading, and the yen edged higher to 142.73 against the U.S. dollar.
Producer price index inflation slowed to 2.5% in August from 3.0% in the prior month, the Bank of Japan reported on Thursday.
Producer inflation eased to the slowest pace since May after the 4% decline in petroleum and coal prices overshadowed a 2.1% increase in food and beverages and a 2.5% rise in electrical machinery.
On a monthly basis, producer price inflation declined 0.2%, its first decline in ten months, indicating a stronger yen and a weaker price of imported petroleum products.
Moreover, sentiment among large Japanese companies jumped 4.5% in the third quarter from a 1% decline in the second quarter, the Cabinet Office reported on Thursday.
The index turned positive for the first time in three quarters despite the Bank of Japan raising rates and signaling possible additional rate hikes in the year.
Market sentiment was also boosted after the crude oil prices traded around a three-year low of $66 a barrel in New York.
Japan imports more than 99% of its crude oil from the Middle Eastern nations, including Saudi Arabia and the United Arab Emirates, and the lower cost of oil weakens domestic inflation.
Investors are also looking forward to the release of monetary policy decisions and economic projections from the European Central Bank later today.
Japan Stock Movers
The Nikkei 225 stock average jumped 3.4% to 36,838.83, and the Topix index advanced 2.4% to 2,591.88.
Tech stocks rebounded sharply, tracking gains in overnight trading in New York.
Softbank jumped 7.6% to ¥8,476.0, Tokyo Electron advanced 4.5% to ¥23,220.0, Advantest Corp. soared 9% to ¥6,283.0, and Screen Holdings added 3.1% to ¥9,949.0.
Industrial machinery and equipment makers jumped more than 5% after the sentiment among large manufacturing companies improved in the third quarter.
Ebara soared 11% to ¥1,901.0, IHI Corp added 9.7% to ¥6,691.0, Kawasaki Heavy Industries jumped 5.6% to ¥4,572.0, and Omron gained 4.8% to ¥6,001.0.
Retailers were in focus after producer price inflation weakened in August.
Seven & I Holdings added 3.7% to ¥2,198.0, Isetan Mitsukoshi increased 1.2% to ¥2,170.0, Aeon Co. Ltd. gained 2.2% to ¥3,906.0, and Fast Retailing jumped 3.6% to ¥44,470.0.
Energy importers and distributors were in focus after crude oil prices hovered near three-year lows amid expectations of lower prices in the fourth quarter.
Eneos Holdings gained 2.3% to ¥738.10, Idemitsu Kosan increased 1.3% to ¥983.20, and Cosmo Energy advanced 3.2% to ¥7,375.0.