- Alexander Garcia
- 05 Feb, 2025
- Miami
Wall Street indexes flatlined on Wednesday after mixed earnings from AMD and Alphabet overwhelmed market sentiment.
The S&P 500 index edged up 0.2%, and the Nasdaq Composite inched lower 0.1% as quarterly earnings announcements gathered pace.
Investors shifted focus from hollow tariff threats to corporate results and reacted to the latest updates from about 80 companies, including Alphabet, Uber Technologies, AMD, Electronic Arts, Chipotle Mexican Grill, and Walt Disney Co.
The yield on 10-year U.S. Treasury notes hovered around 4.5% as investors revise inflation expectations higher amid the persistent threat of Trump tariffs.
Most manufactured goods from China now face a total of 25% tariffs after the latest increase of 10%, and European goods are likely to face at least 10% tariffs as early as the first week in April.
Tariffs are indirect taxes paid by U.S. consumers and not by suppliers or manufacturers located outside the U.S., and a key contributor to inflationary forces.
Moreover, the tariffs on imported goods also disproportionately impact lower-income families, who rely on cheaper goods made in Asia.
The U.S. Postal Service reversed its previously announced plans to process incoming parcels from China and Hong Kong, altering its stance only hours after Trump announcing the measure.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.1% to 6,043.60, the Nasdaq Composite edged down 0.1% to 19,645.84, and the Russell 2000 index increased 0.9% to 2,310.91.
The yield on 2-year Treasury notes edged lower to 4.20%, 10-year Treasury notes decreased to 4.46%, and 30-year Treasury bonds declined to 4.70%.
WTI crude oil decreased $1.09 to $71.60 a barrel, and natural gas prices edged lower by $0.04 to $3.21 a thermal unit.
Gold rose by $23.38 to $2,864.27 an ounce, and silver edged up by $0.17 to $32.24.
The dollar index, which weighs the US currency against a basket of foreign currencies, declined 0.47 to 107.52 and traded at a two-year high.
U.S. Stock Movers
Uber Technologies declined 5.3% to $66.05 after the ride-sharing app and delivery platform operator's revenues were ahead of market expectations, but the company offered a conservative estimate of gross bookings in the first quarter.
Gross bookings in the fourth quarter were $44.2 billion, and the company guided bookings in the first quarter to range between $42 billion and $43.5 billion.
AMD dropped 9.8% to $107.80 after the advanced chipmaker reported weaker-than-expected revenue in its data center unit in the fourth quarter.
Alphabet plunged 7% to $191.70 after the parent company of Google and YouTube reported weaker-than-expected revenue in its cloud computing division as it escalates investment in artificial intelligence.
Apple decreased 2% to $228.16 on speculation that Chinese regulators are likely to expand its investigation list targeting American companies, which could include the popular smartphone maker.
Walt Disney Co. increased 1.3% to $114.81 after the media company and theme park operator's fiscal first quarter earnings surpassed market expectations.
Disney+ subscribers slightly declined, and the company estimated another "modest decline" in the current quarter.
Chipotle Mexican Grill dropped 5.5% to $56.17 after the fast food chain's same-store sales in fiscal 2025 are likely to slow to a low- to mid-single-digit increase.
European Markets React to Domestic Earnings
European markets struggled to advance after U.S. trade relations uncertainty added to market anxieties rooted in the ongoing weak economic backdrop.
Benchmark indexes in Paris, Frankfurt, Milan, and London traded sideways as the European Union and the UK braced for contentious trade discussions with the U.S.
Investor confidence in the Trump administration weakened after the U.S. walked back from threats of aggressive tariffs on goods shipped from Mexico and Canada but increased tariffs by an additional 10% on all imports from China.
The U.S. flip-flop on tariffs stoked speculation in the European Union that the newly appointed presidential administration is more interested in scoring domestic political points rather than confronting structural U.S. economic issues.
Over the last sixty years, the U.S. international trade balance has resulted in an annual deficit, barring a few years, indicating persistent reliance on foreign-made goods from Asia and Europe.
Eurozone PPI Advanced Third Consecutive Month in December
Closer to home, producer price inflation in the eurozone rose in December, an increase in six of the last seven months.
Producer price inflation in the Euro Area increased monthly by 0.4% and was unchanged on an annual basis, according to the latest data released by Eurostat on Wednesday.
Prices in the currency union rose for the third consecutive month in December, and among the largest economies of the bloc, prices advanced 1% in France, 0.9% in Spain, and 0.8% in Italy, but fell 0.1% in Germany.
Europe Indexes and Yields
The DAX index decreased by 0.4% to 21,415.70; the CAC-40 index fell 0.38% to 7,876.58; and the FTSE 100 index declined by 0.06% to 8,565.20.
The yield on 10-year German bonds inched lower to 2.36%, French bonds eased to 3.07%, the UK gilts moved up to 4.60%, and Italian bonds edged lower to 3.45%.
The euro increased to $1.04; the British pound was higher at $1.25; and the U.S. dollar was lower and traded at 90.21 Swiss cents.
Brent crude decreased $0.69 to $75.51 a barrel, and the Dutch TTF natural gas was higher by €0.17 to €49.91 per MWh.
European Stock Movers
Advanced semiconductor equipment makers declined after AMD reported weaker-than-estimated sales in its data center unit.
ASML decreased 1.1% to €704.40, Infineon Technologies AG gained 0.6% to €34.70, and NXP Semiconductors fell 0.8% to €193.50.
Future plc increased 2.6% to 960.0 pence after the UK-based publishing company, and the parent company of Marie Claire, reiterated its fiscal 2025 annual outlook.
GSK plc jumped 5.6% to 1,460.04 pence after the UK-based pharmaceutical company reported strong 2024 results, and the company raised its long-term sales outlook.
Credit Agricole gained 1.6% to €14.82 after the French bank reported better-than-expected earnings for the fourth quarter of 2024, driven by higher revenue.
Banco Santander soared 7.2% to €5.35 after the Spanish bank reported a record quarterly profit and announced a stock repurchase plan worth €10 billion.
The Spanish bank with a vast network of branches across Europe and the Americas is reportedly reviewing its UK retail operations, which could lead to the closure of its branches.
Pandora AS decreased 0.5% to 1,367.0 Danish krone after the fashion jewelry retailer estimated organic growth in 2025 is likely to be lower than in the previous year.
Japan Indexes Extend 2-Day Rally
Stock market indexes in Tokyo advanced for the second consecutive day amid a rally in tech stocks and easing of tensions between the U.S. and its two key trading partners.
The Nikkei 225 stock average and the TOPIX dropped slightly after semiconductor equipment technology recovered following a rally on Wall Street.
Market sentiment recovered after the U.S. presidential administration caved in and delayed the implementation of tariffs on goods shipped from Mexico and Canada.
However, the U.S. imposed an additional 10% tariff on goods imported from China, and the U.S. Postal Service temporarily blocked parcels from China and Hong Kong.
Japan's Real Wages Advanced for the Second Consecutive Month in December
Japan's real wages, adjusted for inflation, advanced for the second consecutive month in December, supported by the rise in winter bonuses.
Nominal wages increased for the second consecutive month in December, surpassing the market expectations and advancing the most in three decades.
The annual increase in nominal wages in December accelerated to 4.8% in December from 3.9% in November, and real wages adjusted for inflation advanced 0.6%, marking the second month of increase.
December month's wage increase was largely driven by a 6.8% rise in winter bonuses, the Ministry of Health, Labour, and Welfare reported Wednesday.
Despite the surge in wages, the ministry noted wages and base salaries are not "keeping pace with prices."
Real wages declined 0.2% in 2024, after nominal wages rose 2.9% while consumer price inflation in the year was 3.2%.
Real wages declined for the third year in a row, after falling 2.5% in 2023, 1.0% in 2022, butt rising 0.6% in 2021.
Japan's Services Sector Growth Accelerated In January
Japan's service sector activities accelerated in January, according to the data released by S&P Global.
The au Jibun Bank Japan Services PMI increased to 53.0 in January from 50.9 in December.
A reading above 50 indicates an increase in growth, while below 50 shows contraction.
Japan Indexes and Movers, Panasonic and Isetan Mitsukoshi In Focus
The Nikkei 225 Stock Average edged up a fraction to close at 38,831.48, and the TOPIX advanced 0.3% to 2,745.41.
Panasonic Holdings Corp. soared 13.6% to ¥1,738.50 after the company raised earnings outlook for its battery division and announced its plans to reform management.
Revenue in the nine months ending in December increased 1.6% to 6.4 trillion yen, but net profit declined 25.4% to 308.7 billion yen, and diluted earnings per share decreased to 123.51 yen from 170.96 yen.
The company said its reforms will begin in the next financial year starting in April and aims to improve profitability by 150 billion yen and an additional 150 billion yen over the next two fiscal years.
Panasonic said in a separate release that its battery unit's operating profit in the fiscal third quarter ending in December rose 39%, and the company raised its full-year outlook by 14% to 124 billion yen, or $799 million.
The company estimated fiscal year 2025 revenue to increase 98% from a year ago to 8.3 trillion yen and operating profit to jump 19% to 380 billion yen.
Isetan Mitsukoshi Holdings dropped 4.8% to ¥2,542.0, despite the department store retailer reporting a higher-than-expected 21% increase in operating profit in the fiscal third quarter.
Revenue in the nine-month period ending in December increased 3.9% to 417.5 billion yen, ordinary profit surged 47% to 66 billion yen, and diluted earnings per share advanced to 124.72 yen from 81.28 yen a year ago.
China and Hong Kong Indexes Turned Lower Following U.S.-China Tariff War
Stock market indexes in China and Hong Kong traded down amid ongoing international trade uncertainties and domestic economic growth worries.
The Hang Seng index decreased 1%, and the mainland-focused CSI 300 index declined 0.6%.
Market indexes declined in Shanghai and Shenzhen after investors returned from a weeklong holiday and reviewed the new trade restrictions announced by the U.S.
China imposed retaliatory tariffs of 15% on the U.S. certain types of coal and natural gas, and 10% on oil, farm equipment, and select automobile imports effective February 10.
China's countermeasures appear to be not as strong as expected, suggesting that policymakers in Beijing are less worried about the new tariffs and trade barriers.
The 10% tariffs imposed by the U.S. are likely to have a short-term impact on shipments of lithium batteries, home appliances, and electric vehicles to the U.S.
E-commerce companies traded down after the U.S. Postal Service temporarily blocked parcels from China and Hong Kong after the announcements of new tariffs.
Despite the tit-for-tat tariffs, the U.S. presidential administration is struggling to stem the rising flow of manufactured goods from China, Asia, and Europe.
The U.S. international trade balance has generated annual deficits for seven decades, and tariffs are not likely to change the long-term trend.
U.S. politicians and economists have long promoted free trade, and adherence to that trade policy has saddled the world's largest economy with an annual trade deficit, which has now reached $1.1 trillion.
China Stock Movers
The Hang Seng index declined 1.1% to 20,556.82, and the mainland-focused CSI 300 index dropped 0.6% to 3,795.73.
JD.com declined 3.8% to HK $155.90, Alibaba Group Holding decreased 0.3% to HK $97.40, and Trip.com Group fell 5.6% to HK $537.50.
Shipping carriers advanced, despite the announcements of tariffs by the U.S. and China.
Orient Overseas International rose 2.7% to HK $105.50, COSCO Shipping Holdings gained 2.5% to HK $11.68, and Pacific Basin Shipping gained 1.9% to HK $1.66.
Electric vehicle makers declined amid worries that large investments in factories in Mexico designed to deliver products in the U.S. may not deliver intended results.
BYD decreased 1.7% to HK $281.40, Li Auto fell 4.2% to HK $90.25, and Xpeng Inc. dropped 1.7% to HK $64.55.
- Alexander Garcia
- 05 Feb, 2025
- Miami
Wall Street indexes flatlined on Wednesday after mixed earnings from AMD and Alphabet overwhelmed market sentiment.
The S&P 500 index edged up 0.2%, and the Nasdaq Composite inched lower 0.1% as quarterly earnings announcements gathered pace.
Investors shifted focus from hollow tariff threats to corporate results and reacted to the latest updates from about 80 companies, including Alphabet, Uber Technologies, AMD, Electronic Arts, Chipotle Mexican Grill, and Walt Disney Co.
The yield on 10-year U.S. Treasury notes hovered around 4.5% as investors revise inflation expectations higher amid the persistent threat of Trump tariffs.
Most manufactured goods from China now face a total of 25% tariffs after the latest increase of 10%, and European goods are likely to face at least 10% tariffs as early as the first week in April.
Tariffs are indirect taxes paid by U.S. consumers and not by suppliers or manufacturers located outside the U.S., and a key contributor to inflationary forces.
Moreover, the tariffs on imported goods also disproportionately impact lower-income families, who rely on cheaper goods made in Asia.
The U.S. Postal Service reversed its previously announced plans to process incoming parcels from China and Hong Kong, altering its stance only hours after Trump announcing the measure.
U.S. Indexes and Treasury Yields
The S&P 500 index increased 0.1% to 6,043.60, the Nasdaq Composite edged down 0.1% to 19,645.84, and the Russell 2000 index increased 0.9% to 2,310.91.
The yield on 2-year Treasury notes edged lower to 4.20%, 10-year Treasury notes decreased to 4.46%, and 30-year Treasury bonds declined to 4.70%.
WTI crude oil decreased $1.09 to $71.60 a barrel, and natural gas prices edged lower by $0.04 to $3.21 a thermal unit.
Gold rose by $23.38 to $2,864.27 an ounce, and silver edged up by $0.17 to $32.24.
The dollar index, which weighs the US currency against a basket of foreign currencies, declined 0.47 to 107.52 and traded at a two-year high.
U.S. Stock Movers
Uber Technologies declined 5.3% to $66.05 after the ride-sharing app and delivery platform operator's revenues were ahead of market expectations, but the company offered a conservative estimate of gross bookings in the first quarter.
Gross bookings in the fourth quarter were $44.2 billion, and the company guided bookings in the first quarter to range between $42 billion and $43.5 billion.
AMD dropped 9.8% to $107.80 after the advanced chipmaker reported weaker-than-expected revenue in its data center unit in the fourth quarter.
Alphabet plunged 7% to $191.70 after the parent company of Google and YouTube reported weaker-than-expected revenue in its cloud computing division as it escalates investment in artificial intelligence.
Apple decreased 2% to $228.16 on speculation that Chinese regulators are likely to expand its investigation list targeting American companies, which could include the popular smartphone maker.
Walt Disney Co. increased 1.3% to $114.81 after the media company and theme park operator's fiscal first quarter earnings surpassed market expectations.
Disney+ subscribers slightly declined, and the company estimated another "modest decline" in the current quarter.
Chipotle Mexican Grill dropped 5.5% to $56.17 after the fast food chain's same-store sales in fiscal 2025 are likely to slow to a low- to mid-single-digit increase.
European Markets React to Domestic Earnings
European markets struggled to advance after U.S. trade relations uncertainty added to market anxieties rooted in the ongoing weak economic backdrop.
Benchmark indexes in Paris, Frankfurt, Milan, and London traded sideways as the European Union and the UK braced for contentious trade discussions with the U.S.
Investor confidence in the Trump administration weakened after the U.S. walked back from threats of aggressive tariffs on goods shipped from Mexico and Canada but increased tariffs by an additional 10% on all imports from China.
The U.S. flip-flop on tariffs stoked speculation in the European Union that the newly appointed presidential administration is more interested in scoring domestic political points rather than confronting structural U.S. economic issues.
Over the last sixty years, the U.S. international trade balance has resulted in an annual deficit, barring a few years, indicating persistent reliance on foreign-made goods from Asia and Europe.
Eurozone PPI Advanced Third Consecutive Month in December
Closer to home, producer price inflation in the eurozone rose in December, an increase in six of the last seven months.
Producer price inflation in the Euro Area increased monthly by 0.4% and was unchanged on an annual basis, according to the latest data released by Eurostat on Wednesday.
Prices in the currency union rose for the third consecutive month in December, and among the largest economies of the bloc, prices advanced 1% in France, 0.9% in Spain, and 0.8% in Italy, but fell 0.1% in Germany.
Europe Indexes and Yields
The DAX index decreased by 0.4% to 21,415.70; the CAC-40 index fell 0.38% to 7,876.58; and the FTSE 100 index declined by 0.06% to 8,565.20.
The yield on 10-year German bonds inched lower to 2.36%, French bonds eased to 3.07%, the UK gilts moved up to 4.60%, and Italian bonds edged lower to 3.45%.
The euro increased to $1.04; the British pound was higher at $1.25; and the U.S. dollar was lower and traded at 90.21 Swiss cents.
Brent crude decreased $0.69 to $75.51 a barrel, and the Dutch TTF natural gas was higher by €0.17 to €49.91 per MWh.
European Stock Movers
Advanced semiconductor equipment makers declined after AMD reported weaker-than-estimated sales in its data center unit.
ASML decreased 1.1% to €704.40, Infineon Technologies AG gained 0.6% to €34.70, and NXP Semiconductors fell 0.8% to €193.50.
Future plc increased 2.6% to 960.0 pence after the UK-based publishing company, and the parent company of Marie Claire, reiterated its fiscal 2025 annual outlook.
GSK plc jumped 5.6% to 1,460.04 pence after the UK-based pharmaceutical company reported strong 2024 results, and the company raised its long-term sales outlook.
Credit Agricole gained 1.6% to €14.82 after the French bank reported better-than-expected earnings for the fourth quarter of 2024, driven by higher revenue.
Banco Santander soared 7.2% to €5.35 after the Spanish bank reported a record quarterly profit and announced a stock repurchase plan worth €10 billion.
The Spanish bank with a vast network of branches across Europe and the Americas is reportedly reviewing its UK retail operations, which could lead to the closure of its branches.
Pandora AS decreased 0.5% to 1,367.0 Danish krone after the fashion jewelry retailer estimated organic growth in 2025 is likely to be lower than in the previous year.
Japan Indexes Extend 2-Day Rally
Stock market indexes in Tokyo advanced for the second consecutive day amid a rally in tech stocks and easing of tensions between the U.S. and its two key trading partners.
The Nikkei 225 stock average and the TOPIX dropped slightly after semiconductor equipment technology recovered following a rally on Wall Street.
Market sentiment recovered after the U.S. presidential administration caved in and delayed the implementation of tariffs on goods shipped from Mexico and Canada.
However, the U.S. imposed an additional 10% tariff on goods imported from China, and the U.S. Postal Service temporarily blocked parcels from China and Hong Kong.
Japan's Real Wages Advanced for the Second Consecutive Month in December
Japan's real wages, adjusted for inflation, advanced for the second consecutive month in December, supported by the rise in winter bonuses.
Nominal wages increased for the second consecutive month in December, surpassing the market expectations and advancing the most in three decades.
The annual increase in nominal wages in December accelerated to 4.8% in December from 3.9% in November, and real wages adjusted for inflation advanced 0.6%, marking the second month of increase.
December month's wage increase was largely driven by a 6.8% rise in winter bonuses, the Ministry of Health, Labour, and Welfare reported Wednesday.
Despite the surge in wages, the ministry noted wages and base salaries are not "keeping pace with prices."
Real wages declined 0.2% in 2024, after nominal wages rose 2.9% while consumer price inflation in the year was 3.2%.
Real wages declined for the third year in a row, after falling 2.5% in 2023, 1.0% in 2022, butt rising 0.6% in 2021.
Japan's Services Sector Growth Accelerated In January
Japan's service sector activities accelerated in January, according to the data released by S&P Global.
The au Jibun Bank Japan Services PMI increased to 53.0 in January from 50.9 in December.
A reading above 50 indicates an increase in growth, while below 50 shows contraction.
Japan Indexes and Movers, Panasonic and Isetan Mitsukoshi In Focus
The Nikkei 225 Stock Average edged up a fraction to close at 38,831.48, and the TOPIX advanced 0.3% to 2,745.41.
Panasonic Holdings Corp. soared 13.6% to ¥1,738.50 after the company raised earnings outlook for its battery division and announced its plans to reform management.
Revenue in the nine months ending in December increased 1.6% to 6.4 trillion yen, but net profit declined 25.4% to 308.7 billion yen, and diluted earnings per share decreased to 123.51 yen from 170.96 yen.
The company said its reforms will begin in the next financial year starting in April and aims to improve profitability by 150 billion yen and an additional 150 billion yen over the next two fiscal years.
Panasonic said in a separate release that its battery unit's operating profit in the fiscal third quarter ending in December rose 39%, and the company raised its full-year outlook by 14% to 124 billion yen, or $799 million.
The company estimated fiscal year 2025 revenue to increase 98% from a year ago to 8.3 trillion yen and operating profit to jump 19% to 380 billion yen.
Isetan Mitsukoshi Holdings dropped 4.8% to ¥2,542.0, despite the department store retailer reporting a higher-than-expected 21% increase in operating profit in the fiscal third quarter.
Revenue in the nine-month period ending in December increased 3.9% to 417.5 billion yen, ordinary profit surged 47% to 66 billion yen, and diluted earnings per share advanced to 124.72 yen from 81.28 yen a year ago.
China and Hong Kong Indexes Turned Lower Following U.S.-China Tariff War
Stock market indexes in China and Hong Kong traded down amid ongoing international trade uncertainties and domestic economic growth worries.
The Hang Seng index decreased 1%, and the mainland-focused CSI 300 index declined 0.6%.
Market indexes declined in Shanghai and Shenzhen after investors returned from a weeklong holiday and reviewed the new trade restrictions announced by the U.S.
China imposed retaliatory tariffs of 15% on the U.S. certain types of coal and natural gas, and 10% on oil, farm equipment, and select automobile imports effective February 10.
China's countermeasures appear to be not as strong as expected, suggesting that policymakers in Beijing are less worried about the new tariffs and trade barriers.
The 10% tariffs imposed by the U.S. are likely to have a short-term impact on shipments of lithium batteries, home appliances, and electric vehicles to the U.S.
E-commerce companies traded down after the U.S. Postal Service temporarily blocked parcels from China and Hong Kong after the announcements of new tariffs.
Despite the tit-for-tat tariffs, the U.S. presidential administration is struggling to stem the rising flow of manufactured goods from China, Asia, and Europe.
The U.S. international trade balance has generated annual deficits for seven decades, and tariffs are not likely to change the long-term trend.
U.S. politicians and economists have long promoted free trade, and adherence to that trade policy has saddled the world's largest economy with an annual trade deficit, which has now reached $1.1 trillion.
China Stock Movers
The Hang Seng index declined 1.1% to 20,556.82, and the mainland-focused CSI 300 index dropped 0.6% to 3,795.73.
JD.com declined 3.8% to HK $155.90, Alibaba Group Holding decreased 0.3% to HK $97.40, and Trip.com Group fell 5.6% to HK $537.50.
Shipping carriers advanced, despite the announcements of tariffs by the U.S. and China.
Orient Overseas International rose 2.7% to HK $105.50, COSCO Shipping Holdings gained 2.5% to HK $11.68, and Pacific Basin Shipping gained 1.9% to HK $1.66.
Electric vehicle makers declined amid worries that large investments in factories in Mexico designed to deliver products in the U.S. may not deliver intended results.
BYD decreased 1.7% to HK $281.40, Li Auto fell 4.2% to HK $90.25, and Xpeng Inc. dropped 1.7% to HK $64.55.