- Barry Adams
- 02 Apr, 2024
- New York City
U.S. stocks declined for the second day in a row, and yields on Treasury notes approached three-month highs after a string of data points highlighted a resilient economy.
The S&P 500 index and the Nasdaq Composite fell close to 1%, and the yield on 10-year Treasury notes advanced to a three-month high of 4.39%.
Investors are scaling back expectations of interest rate cuts as early as June after the personal consumption expenditures price index eased but stayed sharply higher than the Fed's 2% target rate.
Moreover, a private survey showed manufacturing activities were ahead of the market's expectations in March.
Total construction activities, private and public, in February also rose more than expected from a year ago, indicating resilient economic conditions.
Investors are also awaiting the release of the JOLT job openings report and the factory orders report later in the day.
U.S. Indexes and Yields
The S&P 500 index decreased 0.8% to 5,200.07, and the Nasdaq Composite fell 1.2% to 16,198.84.
The yield on 2-year Treasury notes increased to 4.73%, 10-year Treasury notes inched up to 4.39%, and 30-year Treasury bonds edged up to 4.53%.
WTI crude oil increased $1.12 to $85.01 a barrel, and natural gas prices decreased 4 cents to $1.78 a thermal unit.
Gold jumped to a record high on the hopes that the U.S. Federal Reserve is more likely to lower interest rates after the release of the weaker-than-expected PCE Price Index.
Moreover, elevated geopolitical tensions in the Middle East and the ongoing war in Ukraine contributed to market anxieties.
Gold increased by $6.41 to $2,256.04 an ounce, and silver rose 4 cents to $25.01.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.93.
U.S. Stock Movers
Health insurance stocks fell sharply after the Centers for Medicare and Medicaid Services finalized its capitation rates to 3.7% for financial year 2025, matching the rate in financial year 2024.
Humana dropped 10.9% to $313.0, CVS Health fell 6.5% to $74.49, UnitedHealth Group declined 4.3% to $468.54, and Cigna Group eased 1.9% to $357.32 on the worry that operating margin will remain under pressure.
Payments from the government to Medicare Advantage plans are expected to increase on average by 3.70%, or over $16 billion, from 2024 to 2025.
The federal government is projected to pay between $500 and $600 billion in Medicare Advantage payments to private health plans in 2025.
PVH Corp. plunged 22% to $108.40 after the apparel maker and the parent company of popular brands Tommy Hilfiger and Calvin Klein offered a weak full-year outlook, citing weak macroeconomic conditions in Europe.
General Electric Co. dropped 20% to $139.91 after the diversified conglomerate completed its three-way breakup, and its aerospace and energy business is scheduled to trade as a separate company starting Tuesday.
Canoo Inc. plunged 30% to $2.68 after the management highlighted "substantial doubt" about the company's ability to continue as a going concern.
Trump Media & Technology Group declined 1% to $48.16 and extended a two-day loss to more than 22% after the company reported a sharply higher quarterly loss in its latest quarter a day ago.
Tesla declined 6.7% to $163.65 after the electric vehicle maker reported sharply lower deliveries in the first quarter.
Tesla deliveries in the first quarter declined to 386,810 units from 412,376 units a year ago, and production eased to 433,371 units from 440.808 units a year ago.
- Inga Muller
- 02 Apr, 2024
- Frankfurt
European markets struggled to advance after a four-day holiday weekend, and bond yields edged higher.
The DAX index decreased by 0.1% to 18,480.81, the CAC-40 index rose by 0.2% to 8,218.86, and the FTSE 100 index inched higher by 0.3% to 7,973.30.
The yield on 10-year German bonds edged up to 2.39%; French bonds inched higher to 2.89%; the UK gilts edged higher to 4.09%; and Italian bonds inched lower to 3.76%.
Rheinmetall AG jumped 2.2% to €533.40 after the German automotive products and arms maker won an order worth 135 million from the military contractor KNDS Group.
UBS Group advanced 0.5% to CHF 27.89 after the Swiss bank launched a new stock repurchase program of up to $2 billion.
Metals and mining companies advanced after manufacturing activities expanded at a faster pace in the U.S. and China.
Antofagasta, Anglo America, and Glencore gained between 1% and 2.5%.
BP plc and Shell PLC jumped 2.9% after Brent crude oil prices approached a five-month high of $89 a barrel on the expectation of rising demand in China and falling inventories in the U.S.
Home builders in the U.K. edged lower on the worry that rising home prices may dent demand in the months ahead.
Persimmon declined 1.9% to 1,290.50 pence, and Taylor Wimpey decreased 1,290.50 pence after the home price index unexpectedly fell in March after higher mortgage rates dented demand.
CTS Eventim increased 0.5% to €82.95 after the German festival ticketing company signed a put option agreement to acquire Vivendi's festival and ticketing operation outside of France for an undisclosed amount.
See Tickets, owned by Vivendi, sold about 44 million tickets in 2023 for trade shows, sports events, concerts, and other consumer and business events in the U.S., Belgium,
Vivendi's ticketing business generated about €105 million of the total of €137 million through its broader festival operations, with U.S. and UK revenues accounting for the majority of the share.
- Bridgette Randall
- 02 Apr, 2024
- Frankfurt
European market indexes struggled to advance, bond yields edged higher, and the euro held steady in Tuesday's trading.
Market sentiment was cautiously optimistic as investors reviewed mixed updates on factory activities in the eurozone, the U.K., Spain, Italy, and Holland.
Benchmark indexes in Paris, Frankfurt, and London hovered near recent record highs as investors debated future interest rate paths amid a weak macroeconomic backdrop and a moderating but elevated inflation level.
Crude oil prices advanced to a five-month high, stoking fears that higher energy prices may fuel another bout of inflation, supporting the case for higher-for-longer interest rates.
UK Home Price Annual Change Accelerate In March
The UK home price unexpectedly declined in March from the previous month, according to the latest update released by the Nationwide Building Society.
The Nationwide Building Society's house price index decreased 0.2% from the previous month in March, after rising 0.7% in February.
The home price index increased 1.6% from a year ago, faster than 1.2% rise in February, and the average home price increased to £261,142 from £260,420 in the previous month.
Euro Area Inflation Expectations Moderate
The consumer expectations of inflation in the Euro Area moderated in February, according to the latest survey released by the European Central Bank.
Median expectations of inflation over the next 12 months eased to 3.1% in February from 3.3% in January, the survey showed.
The inflation expectations dropped to the lowest since the start of the Ukraine war; however, the three-year forward inflation outlook was unchanged at 2.5%.
However, consumers anticipated home prices to advance at a slightly faster pace of 2.4% from 2.2% in January, but mortgage rate expectations were unchanged at 5.1%.
Unemployment rate expectations over the next 12 months stayed the same at 10.9%, and economic growth over the same period was unchanged at -1.1%.
Consumers were slightly more optimistic about nominal income growth expectations, with an increase of 1.4% compared to the previous expectation of 1.2% in January, but nominal spending growth expectations were stable at 3.7%.
Europe Indexes and Yields
The DAX index decreased by 0.1% to 18,480.81, the CAC-40 index rose by 0.2% to 8,218.86, and the FTSE 100 index inched higher by 0.3% to 7,973.30.
The yield on 10-year German bonds edged up to 2.39%; French bonds inched higher to 2.89%; the UK gilts edged higher to 4.09%; and Italian bonds inched lower to 3.76%.
The euro edged higher to $1.076, the British pound inched higher to $1.256, and the U.S. dollar held steady at 90.84 Swiss cents.
Brent crude increased $1.21 to $88.92. a barrel, and the Dutch TTF natural gas fell by €0.35 to €26.98 per MWh.
Europe Stock Movers
Rheinmetall AG jumped 2.2% to €533.40 after the German automotive products and arms maker won an order worth 135 million from the military contractor KNDS Group.
UBS Group advanced 0.5% to CHF 27.89 after the Swiss bank launched a new stock repurchase program of up to $2 billion.
Metals and mining companies advanced after manufacturing activities expanded at a faster pace in the U.S. and China.
Antofagasta, Anglo America, and Glencore gained between 1% and 2.5%.
BP plc and Shell PLC jumped 2.9% after Brent crude oil prices approached a five-month high of $89 a barrel on the expectation of rising demand in China and falling inventories in the U.S.
Persimmon declined 1.9% to 1,290.50 pence, and Taylor Wimpey decreased 1,290.50 pence after the home price index unexpectedly fell in March after higher mortgage rates dented demand.
CTS Eventim increased 0.5% to €82.95 after the German festival ticketing company signed a put option agreement to acquire Vivendi's festival and ticketing operation outside of France for an undisclosed amount.
See Tickets, owned by Vivendi, sold about 44 million tickets in 2023 for trade shows, sports events, concerts, and other consumer and business events in the U.S., Belgium,
Vivendi's ticketing business generated about €105 million of the total of €137 million through its broader festival operations, with U.S. and UK revenues accounting for the majority of the share.
- Akira Ito
- 02 Apr, 2024
- Tokyo
Asian markets rebounded; the Nikkei index in Tokyo soared more than 1.5% but erased most of the gains; and market indexes in Shanghai struggled to gain traction.
The Hang Seng index in Hong Kong advanced 2.4% after investors returned from a long weekend and reacted to an improving economic manufacturing activity report released over the weekend.
However, market indexes in South Korea and Australia closed mixed amid interest rate uncertainties.
Japan Indexes Erase Early Gains in Choppy Trading
Stocks in Japan attempted to rebound in Tuesday's trading in cautious trading after the U.S. manufacturing survey showed stronger-than-expected activities in March.
Moreover, investors also turned cautious a day after the release of data on business confidence among large manufacturing companies and the persistent weakness in factory activities for the tenth month in a row.
In other economic news, the monetary base in Japan increased by 1.6% from a year ago in March to 666,240 trillion yen, the Bank of Japan said on Tuesday.
The monetary base data for February was revised higher to 2.4% from the previous estimate of 2.1%, and the seasonally adjusted monetary base rose 3.6%.
The Nikkei 225 index rose 0.1% to 39,837.47, and the Topix index fell 0.2% to 2,714.93.
Large manufacturing companies traded lower on the prospect of higher labor costs, but tech companies continued to extend this year's gains.
Tokyo Electron, SoftBank, Screen Holdings, and Disco Corp. gained between 1% and 3%.
Sumco Corp., Ebara Corp., and Rrenesas Electronics gained between 2% and 4%.
Toyota Motor, Honda Motor, Nissan Motor, and Subaru declined between 1% and 4%.
Nippon Steel advanced 2% to ¥3,689.0 as the company made its final push to acquire U.S. Steel for $14.1 billion.
Hong Kong Stocks Rebound, Shanghai Stocks Struggle Near Flatline
Stocks in Shanghai lacked direction, but benchmark indexes in Hong Kong advanced after investors reacted positively to the rising factory activity data released over the weekend.
China's manufacturing purchasing managers' index increased to 50.8 in March from 49.1 in February, the National Bureau of Statistics reported on Sunday.
Moreover, investors hoped that foreign investors would continue to purchase Chinese stocks following the net inflows in February and March.
The Hang Seng index declined nearly 3% in the first quarter and extended four-year losses on the protracted property market slump, weak consumer and investor confidence, and the government's prioritizing of national security over the economy, targeting foreign firms.
The CSI 300 index decreased 0.5% to 3,576.11, but the Hang Seng index rose 2.2% to 16,912.34.
Bank of China, China Merchant Bank, ICBC, and Agriculture Bank of China advanced between 1% and 4% in Hong Kong trading.
Xiaomi Corp. soared 10.4% to HK$16.48 after the smart phone maker reported strong demand for its electric vehicle released last week.
India Stocks Look Down, Rupee Holds Firm Near Record Low
Stocks lacked direction in Mumbai trading, and investors awaited interest rate decisions from the Reserve Bank of India on Friday.
The Sensex and the Nifty indexes traded around the flatline as investors debated future rate paths and domestic macroeconomic conditions.
The yield on 5-year Indian government bonds held stable, and the Indian rupee traded near record lows after the U.S. dollar edged higher against major international currencies.
The Sensex index increased 0.04% to 74,044.45, and the Nifty index edged up 0.2% to 22,490.05.
On the Mumbai stock exchange, 68 stocks traded at their 52-week highs and 12 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds held steady at 7.05%, and the Indian rupee held steady at ₹83.35 against the U.S. dollar.
- Arun Goswami
- 02 Apr, 2024
- Mumbai
Stocks in Mumbai trading lacked direction and, investors debated future rate paths after crude oil prices rose to a five-month high.
The Sensex index increased 0.04% to 74,044.45, and the Nifty index edged up 0.2% to 22,490.05.
On the Mumbai stock exchange, 68 stocks traded at their 52-week highs and 12 stocks traded at their 52-week lows.
JTL Industries increased 5.2% to ₹211.50, and the pipe and tube maker said its fiscal year 2024 sales rose to a record high of 341,845 metric tons.
NMDC gained 0.1% to ₹212.90, and the iron ore mining company said its production declined 13.2% from the previous month to 4.86 million tons in March.
Jubilant Pharmova decreased 0.6% to ₹571.35 after the company received a demand of ₹228.8 crore from the Income Tax Department.
Bharat Dynamics declined 3% to ₹1,720.00, and the company said sales in the fiscal year 2024 decreased to 2,350 crore from 2,489 crore in the previous year, citing supply chain disruptions linked to the ongoing war in Ukraine and rebel attacks in Red Sea lanes.
South Indian Bank decreased 4.1% to ₹27.95, and the financial service company said gross loans in the fiscal year 2024 increased 11.4% to ₹80,337 crore and total deposits rose 11.2% to ₹1.01 lakh crore.
Indian Renewable Energy Development Agency, or Ireda, gained 5% to ₹149.75, and the financing company said total outstanding loans expanded 26.7% to ₹59,650 crore.
IIFL Finance added 0.9% to ₹348.60, and the company received approval to increase its stake in the National Stock Exchange through the purchase of ₹284.4 crore worth of stake from FIH Mauritius Investments Ltd.
Maruti Suzuki India decreased 0.04% to ₹12,564.30, and the vehicle maker said production in the fiscal year 2024 rose to 166,730 units from 154,148 units a year ago.
Anant Raj rose 2% to ₹330.55 after the residential development company confirmed the sale of ₹4,150 crore for its projects located at Sector 63 A Gurugram, Haryana.
Aditya Birla Fashion and Retail soared 14% to ₹241.15 after the retailer confirmed its plans to spinoff Madura Fashion as a separate company.
Hero Motocorp declined 2% to ₹4,578.0 and the maker of 2-wheeler vehicles said unit sales declined 5.6% to 490,415 units in March.
Total vehicle sale in the fiscal year 2024 rose 5.5% from a year ago to 5.621 million or 56.21 lakhs.
TVS Motor Company increased 0.1% to ₹2,141.50 after the maker of two-wheeler said its vehicle sales in March rose 12% to 354,592 units.
Vehicle sales in the fiscal year 2024 rose 14% to 4.2 million or 42 lakh units.
- Barry Adams
- 01 Apr, 2024
- New York City
Stocks on Wall Street lacked direction after traders returned from a three-day weekend.
Benchmark indexes struggled around the flat line after February's price consumption expenditures index met market expectations.
Moreover, construction spending eased in February from the previous month but rose in double digits from a year ago.
The U.S. Personal Consumption Expenditures Price Index in February and the alternative measure of inflation rose less than expected. The index is closely watched by the Federal Reserve to monitor how consumers react to inflation and adjust purchases.
The latest update on the index was released on Friday, and U.S. investors reacted to the data after trading resumed following the Good Friday holiday.
The widely followed stock market indexes advanced in the first quarter, and the S&P 500 index gained 10.2%, its best quarterly performance in five years.
The Nasdaq Composite advanced 9.1%, and the Dow Jones Industrial Average added 5.6%.
Investors have been bidding up stocks in the hopes that central banks around the world are laying the groundwork for possible rate cuts in the second half as inflation continues to soften.
A week ago, the US, the UK, and Norway held their policy rates, but Switzerland bucked the trend and led other central banks by lowering rates by 25 basis points.
This week investors are looking ahead to the release of the Job Openings and Labor Turnover Survey report on Tuesday, the ADP’s private sector employment update on Wednesday, and the nonfarm payrolls report on Friday.
PCE Price Index Slows But Stays Elevated
The PCE price index rose 2.5% from a year ago and advanced 0.3% from the previous month, the U.S. Bureau of Economic Analysis reported Friday.
The index accelerated to an annual rate of 2.5% from 2.4% and slowed to 0.3% monthly from 1.0% in the previous month, respectively.
The core rate, which excludes volatile food and energy prices, rose at a slower pace of 2.8% from the 2.9% rate in January.
Construction Spending Edges Lower
Construction spending in February decreased by 0.3% from the previous month but soared by 10.7% from a year ago, the U.S. Census Bureau reported Monday.
Total construction spending eased to an annual pace of $2.091 trillion, up from $2.096 trillion.
Private construction was unchanged from the previous month but rose 9% from a year ago to $1.6 trillion, and public construction spending edged down 1.2% from the previous month but rose 16.8% to an annual pace of $474.4 billion.
Of the private construction spending, residential construction spending increased 0.7% from the previous month or rose 6.3% from a year ago to $901 billion.
U.S. Indexes and Yields
The S&P 500 index decreased 0.3% to 5,237.58, and the Nasdaq Composite fell 0.1% to 16,368.48.
The yield on 2-year Treasury notes increased to 4.62%, 10-year Treasury notes inched down to 4.21%, and 30-year Treasury bonds edged up to 4.37%.
WTI crude oil increased $1.26 to $84.39 a barrel, and natural gas prices increased 9 cents to $1.84 a thermal unit.
Gold jumped to a record high on the hopes that the U.S. Federal Reserve is more likely to lower interest rates after the release of the weaker-than-expected PCE Price Index.
Moreover, elevated geopolitical tensions in the Middle East and the ongoing war in Ukraine contributed to market anxieties.
Gold increased by $9.88 to $2,241.81 an ounce, and silver rose 8 cents to $25.05.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.03.
Indexes In Japan and China Diverge After Factory Activities Updates
Stock markets in Asia lacked momentum amid thin trading as investors in Japan confronted weak economic data, but factory activities rose more than expected in China.
Investors also reviewed the U.S. Personal Consumption Expenditures Price Index in February, and the alternative measure of inflation watched by the Federal Reserve rose less than expected.
Nikkei 225 Drops 1% Amid Weak Key Economic Reports
Benchmark indexes in Tokyo headed lower and extended losses after the Bank of Japan showed a decline in sentiment among large manufacturers.
The quarterly Tankan survey showed that sentiment among large manufacturers eased to +11 in the first quarter from an upwardly revised +13 in the fourth quarter, while the manufacturing outlook for the second quarter points to a further slowdown to +10.
The weakness in the outlook was due to the shut-down of automobile manufacturing plants.
The au Jibun Bank Japan Manufacturing PMI was confirmed at 48.2% in March, following the final reading of 47.2 in February, which was the lowest level since August 2020, according to S&P Global.
The private survey showed that factory activities contracted for the tenth month in a row, but the decline was the smallest since November, amid softer declines in output and new orders falling at the slowest pace in five months.
Nonetheless, factory activities continued to shrink amid global macroeconomic headwinds and continued supply chain disruptions in the Red Sea and Panama Canal.
The Nikkei 225 stock average decreased 1.1% to 39,920.18, and the Topix index dropped 1.5% to 39,920.18.
Stocks declined in a broad-based sell-off, and technology, financial services providers, and diversified conglomerates led the decliners.
SoftBank, Screen Holdings, Advantest, Tokyo Electron, and Disco Holdings dropped between 1.5% and 4%.
Mitsubishi UFJ, Mizuho Financial Group, and Sumitomo Mitsui are around 3.5%.
Marubeni, Itochu, Mitsui & Company, Mitsubishi Corp., and Sumitomo declined between 1.3% and 3.0%.
China Manufacturing Activities Expanded Fifth Consecutive Month
Chinese stocks jumped and benchmark indexes advanced the most in a month after a private survey showed China's manufacturing activities rose at a faster-than-expected pace in March.
The Caixin China General Manufacturing PMI was 51.1 in March, higher than 50.9 in February.
The 50-level mark separates growth from contraction, and activities expanded for the fifth month in a row and reached their highest level since February 2023.
The CSI 300 index jumped 1.5% to 3,589.29, and financial markets in Hong Kong were closed for a public holiday.
Foreign Investors Increase Exposure to Chinese stocks
Stocks also powered ahead after the data from exchanges showed that foreign investors purchased $11.5 billion of mainland stocks in the last two months.
Funds controlled by foreign investors purchased 22 billion yuan, or $3 billion, of stocks in March, following the purchase of 60.7 billion yuan in February, according to Stock Connect data.
Foreign investors have been selling mainland China stocks for six months in a row between August and January due to the protracted property market malaise, weak consumer confidence, and fragile economic recovery after the ending of zero COVID restrictions.
BYD added 3.8% to 210.70 yuan, CATL gained 4% to 197.96 yuan, Ganfeng Lithium Group advanced 7.7% to 39.15 yuan, and Tianqi Lithium added 4.8% to 50.27 yuan.
India Stocks Advance Ahead of Rate Decision
Stocks in Mumbai advanced amid thin trading in Asia and positive international sentiment.
The Sensex and the Nifty indexes gained more than 0.7%, and the yield on Indian government bonds held steady in the hopes that the Reserve Bank of India would hold its benchmark rate later in the week.
Market sentiment was positive, and metals stocks advanced after a private survey showed China's manufacturing activities rose at a faster-than-expected pace in March.
The Sensex index increased 0.7% to 74,213.44, and the Nifty index edged up 0.8% to 22,519.55.
On the Mumbai stock exchange, 95 stocks traded at their 52-week highs and 37 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds decreased to 7.05%, and the Indian rupee held steady at ₹83.35 against the U.S. dollar.
Prestige Estates Projects jumped 4% to ₹1,217.60 after the company struck an investment partnership with the Abu Dhabi Investment Authority and funds controlled by Kotak Mahindra.
NHPC rose 0.5% to ₹89.30, and the company secured a loan of 20 billion yen from a Japan-controlled investment company for the construction of a power plant in Manipur.
- Barry Adams
- 01 Apr, 2024
- New York City
Benchmark stock indexes edged higher in early trading after investors reacted for the first time to the release of an alternative measure of inflation on Friday.
The U.S. Personal Consumption Expenditures Price Index in February and the alternative measure of inflation watched by the Federal Reserve rose less than expected.
The latest update on the index was released on Friday, and U.S. investors reacted to the data after trading resumed following the Good Friday holiday.
The PCE price index rose 2.5% from a year ago and advanced 0.3% from the previous month, the U.S. Bureau of Economic Analysis reported Friday.
The index accelerated to an annual rate of 2.5% from 2.4% and slowed to 0.3% monthly from 1.0% in the previous month, respectively.
The core rate, which excludes volatile food and energy prices, rose at a slower pace of 2.8% from the 2.9% rate in January.
The widely followed indexes advanced in the first quarter, and the S&P 500 index gained 10.2%, its best quarterly performance in five years.
The Nasdaq Composite advanced 9.1%, and the Dow Jones Industrial Average added 5.6%.
Investors have been bidding up stocks in the hopes that central banks around the world are laying the groundwork for possible rate cuts in the second half as inflation continues to soften.
A week ago, the US, the UK, and Norway held their policy rates, but Switzerland bucked the trend and led other central banks by lowering rates by 25 basis points.
This week investors are looking ahead to the release of the Job Openings and Labor Turnover Survey report on Tuesday, the ADP’s private sector employment update on Wednesday, and the nonfarm payrolls report on Friday.
The construction spending report for February is scheduled to be released later today.
U.S. Indexes and Yields
The S&P 500 index increased 0.08% to 5,269.37, and the Nasdaq Composite rose 0.36% to 16,441.28.
The yield on 2-year Treasury notes increased to 4.62%, 10-year Treasury notes inched down to 4.21%, and 30-year Treasury bonds edged up to 4.37%.
WTI crude oil increased $0.22 to $82.90 a barrel, and natural gas prices decreased 1 cent to $1.74 a thermal unit.
Gold jumped to a record high on the hopes that the U.S. Federal Reserve is more likely to lower interest rates after the release of the weaker-than-expected PCE Price Index.
Moreover, elevated geopolitical tensions in the Middle East and the ongoing war in Ukraine contributed to market anxieties.
Gold increased by $14.94 to $2,247.51 an ounce, and silver rose 4 cents to $25.01.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.53.
- Li Chen
- 01 Apr, 2024
- Hong Kong
Stock markets in Asia lacked momentum amid thin trading as investors in Japan confronted weak economic data, but factory activities rose more than expected in China.
Investors also reviewed the U.S. Personal Consumption Expenditures Price Index in February, and the alternative measure of inflation watched by the Federal Reserve rose less than expected.
The latest update on the index was released on Friday, and the U.S. market will react to the data for the first time on Monday after trading resumes following the Good Friday holiday.
The PCE price index rose 2.5% from a year ago and advanced 0.3% from the previous month, the U.S. Bureau of Economic Analysis reported Friday.
The index accelerated to an annual rate of 2.5% from 2.4% and slowed to 0.3% monthly from 1.0% in the previous month, respectively.
The core rate, which excludes volatile food and energy prices, rose at a slower pace of 2.8% from the 2.9% rate in January.
Nikkei 225 Drops 1% Amid Weak Key Economic Reports
Benchmark indexes in Tokyo headed lower and extended losses after the Bank of Japan showed a decline in sentiment among large manufacturers.
The quarterly Tankan survey showed that sentiment among large manufacturers eased to +11 in the first quarter from an upwardly revised +13 in the fourth quarter, while the manufacturing outlook for the second quarter points to a further slowdown to +10.
The weakness in the outlook was due to the shut-down of automobile manufacturing plants.
The au Jibun Bank Japan Manufacturing PMI was confirmed at 48.2% in March, following the final reading of 47.2 in February, which was the lowest level since August 2020, according to S&P Global.
The private survey showed that factory activities contracted for the tenth month in a row, but the decline was the smallest since November, amid softer declines in output and new orders falling at the slowest pace in five months.
Nonetheless, factory activities continued to shrink amid global macroeconomic headwinds and continued supply chain disruptions in the Red Sea and Panama Canal.
The Nikkei 225 stock average decreased 1.1% to 39,920.18, and the Topix index dropped 1.5% to 39,920.18.
Stocks declined in a broad-based sell-off, and technology, financial services providers, and diversified conglomerates led the decliners.
SoftBank, Screen Holdings, Advantest, Tokyo Electron, and Disco Holdings dropped between 1.5% and 4%.
Mitsubishi UFJ, Mizuho Financial Group, and Sumitomo Mitsui are around 3.5%.
Marubeni, Itochu, Mitsui & Company, Mitsubishi Corp., and Sumitomo declined between 1.3% and 3.0%.
China Manufacturing Activities Expanded Fifth Consecutive Month
Chinese stocks jumped and benchmark indexes advanced the most in a month after a private survey showed China's manufacturing activities rose at a faster-than-expected pace in March.
The Caixin China General Manufacturing PMI was 51.1 in March, higher than 50.9 in February.
The 50-level mark separates growth from contraction, and activities expanded for the fifth month in a row and reached their highest level since February 2023.
The CSI 300 index jumped 1.5% to 3,589.29, and financial markets in Hong Kong were closed for a public holiday.
Foreign Investors Increase Exposure to Chinese stocks
Stocks also powered ahead after the data from exchanges showed that foreign investors purchased $11.5 billion of mainland stocks in the last two months.
Funds controlled by foreign investors purchased 22 billion yuan, or $3 billion, of stocks in March, following the purchase of 60.7 billion yuan in February, according to Stock Connect data.
Foreign investors have been selling mainland China stocks for six months in a row between August and January due to the protracted property market malaise, weak consumer confidence, and fragile economic recovery after the ending of zero COVID restrictions.
BYD added 3.8% to 210.70 yuan, CATL gained 4% to 197.96 yuan, Ganfeng Lithium Group advanced 7.7% to 39.15 yuan, and Tianqi Lithium added 4.8% to 50.27 yuan.
India Stocks Advance Ahead of Rate Decision
Stocks in Mumbai advanced amid thin trading in Asia and positive international sentiment.
The Sensex and the Nifty indexes gained more than 0.7%, and the yield on Indian government bonds held steady in the hopes that the Reserve Bank of India would hold its benchmark rate later in the week.
Market sentiment was positive, and metals stocks advanced after a private survey showed China's manufacturing activities rose at a faster-than-expected pace in March.
The Sensex index increased 0.7% to 74,213.44, and the Nifty index edged up 0.8% to 22,519.55.
On the Mumbai stock exchange, 95 stocks traded at their 52-week highs and 37 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds decreased to 7.05%, and the Indian rupee held steady at ₹83.35 against the U.S. dollar.
Prestige Estates Projects jumped 4% to ₹1,217.60 after the company struck an investment partnership with the Abu Dhabi Investment Authority and funds controlled by Kotak Mahindra.
NHPC rose 0.5% to ₹89.30, and the company secured a loan of 20 billion yen from a Japan-controlled investment company for the construction of a power plant in Manipur.
- Arun Goswami
- 01 Apr, 2024
- Mumbai
Stocks in Mumbai advanced following positive international market sentiment and ahead of the Reserve Bank of India's rate decision on Friday.
The Sensex index increased 0.7% to 74,213.44, and the Nifty index edged up 0.8% to 22,519.55.
On the Mumbai stock exchange, 95 stocks traded at their 52-week highs and 37 stocks traded at their 52-week lows.
Chennai Petroleum Corporation declined 0.9% to ₹906.0, and the company board approved the cost revision for the construction of a petroleum refinery in Tamil Nadu in a joint venture with Indian Oil Corporation, Cauvery Basin Refinery, and Petrochemicals Limited.
The board approved the cost revision to ₹33,023 crore from ₹29,361 crore.
Rail Vikas Nigam dropped 1.2% to ₹252.20, and the company was deemed the lowest bidder for three rail infrastructure development projects totaling ₹148.3 crore.
Indian Oil rose 1% to ₹168.0, and the company signed an agreement to manufacture lithium ion cells in India with Panasonic Energy.
NCC jumped 3.9% to ₹241.50 after the company said it received orders worth ₹3,084 crore in March.
Torrent Power dropped 3.9% to ₹1,365.40, and the company received an order from its power distribution unit for ₹1,825 crore.
Garden Reach Shipbuilders decreased 1.4% to ₹765.90, and the company reported a record revenue of ₹3,400 crore in fiscal year 2024.
Prestige Estates Projects jumped 4% to ₹1,217.60 after the company struck an investment partnership with the Abu Dhabi Investment Authority and funds controlled by Kotak Mahindra.
NHPC rose 0.5% to ₹89.30, and the company secured a loan of 20 billion yen for the construction of a power plant in Manipur.
Veranda Learning declined 2.8% to ₹178.0, and the company acquired a 50% stake for ₹240 crore in Tapasaya Educational Institutions.
Infosys gained 1.1% to ₹1,514.75, and the technology services provider said it expects a windfall refund of ₹6,329 crore from the Income Tax Department.
- Scott Peters
- 29 Mar, 2024
- New York City
Home Depot agreed to acquire SRS Distribution as the company ramps up its offering to residential home contractors.
Home offered to pay $18.25 billion for the building supply distributor, and the deal is expected to be finalized before the end of the current financial year and funded with additional debt and cash on hand.
The company is currently owned by the private equity firms Leonard Green & Partners and Berkshire Partners.
"SRS is an industry leader with a proven track record of profitable growth across verticals," said Ted Decker, chair, president, and chief executive of Home Depot.
Home Depot has been looking to expand its offerings to professional customers who are active in building homes, providing roofing services, and carrying out large and complex renovation projects.
Professional customers are just 10% of the company's customer base, but they drive about half of the company's sales.
The specialty retailer was one of the major beneficiaries of the pandemic boom, but in the last two years, do-it-yourself activities have been shrinking as individuals focus on smaller projects while dealing with high prices.
But in the last two years, the retailer has been struggling with a slowdown in the do-it-yourself segment as individual customers shift their attention away from expensive projects.
SRS Distribution provides supplies to contractors involved in roofing, landscaping, and pool construction.
The company will assume $5.5 billion of SRS's debt and raise about $12.5 billion in a debt offering; the balance will be funded by cash on hand.
The company plans to maintain its current investment-grade rating after the debt offering.
The debt-funded transaction is expected to be dilutive to earnings per share due to amortization expenses, but accretive from a cash perspective in the first year and post-closing, excluding synergies.
The McKinny, Texas-based distribution company was founded in 2008 and generated revenue of $10 billion in 2023, or about 6% of Home Depot's sales.
employs 11,000 people, has a network of 760 stores in 47 states, and has 4,000 delivery trucks and vehicles to deliver directly to the jobsite.
Home Depot has been adding capabilities for its professional contractor space with the reacquisition of HD Supply for $8 billion in 2020, after selling the company for $10.3 billion to a group of private equity investors in 2007.
Home Depot operates 2,335 stores in the U.S., Canada, and Mexico and employs about 465,000 people as of the end of its fiscal year in late January.
The retailer confirmed that it plans to open new distribution centers in Detroit, Toronto, Los Angeles, and San Antonio and provide a wider set of products, including lumber, shingles, and insulation, to its professional customers.
- Arun Goswami
- 29 Mar, 2024
- Mumbai
Stock markets in Japan and Asia lacked momentum as most markets in the region were closed for a public holiday.
In thin trading, the benchmark indexes in Tokyo advanced as investors digested the latest batch of economic releases.
The jobless rate inched up to 2.6% in February, and the job-to-applicants ratio moderated to 1.26%, indicating tight but easing labor market conditions.
The unemployment rate increased from 2.4% in January, and the measure of unemployment rose to its highest level since last September, the labor ministry reported Friday.
In February, the number of unemployed increased by 120,000 to 1.82 million, and payrolls rose by 220,000 to 67.83 million, the Ministry of Internal Affairs and Communications said Friday.
On the inflation front, consumer price inflation in Tokyo eased in March but stayed above the Bank of Japan's target level.
Consumer prices excluding fresh food rose 2.4% in March, rising at a slower pace than 2.5% in February, according to a separate report released by the ministry.
The non-seasonally adjusted labor force participation edged up to 62.8% from 62.1% in the corresponding month a year ago.
Japan's industrial output declined 0.1% from the previous month and dropped 3.4% from a year ago in February, the Ministry of Economy, Trade, and Industry reported Friday.
Industrial production improved from a decline of 6.7% in January, the sharpest fall since May 2020, due to the continued weakness in vehicle and machinery production.
Japan's retail sales rose 4.6% from a year ago to 12.9 trillion yen and expanded from the downwardly revised increase of 2.4% in January, said the ministry in a separate report.
Commercial sales increased 3.3% to 47.8 trillion yen, and wholesale sales rose 2.9% to 34.9 trillion yen from a year ago, respectively.
The Nikkei 225 stock average added 0.4% to 40,345.11, and the Topix gained 0.6% to 40,345.11.
Tech stocks were among the leading gainers, and Tokyo Electron, Screen Holdings, Disco Corp., and Advantest rose between 1.5% and 4%.
SoftBank declined 0.9%, and Uniqlo parent Fast Retailing jumped 0.9%.
Vehicle makers traded mixed, and Toyota Motor Edged fell a fraction, but Honda Motor and Nissan Motor rose about 2%.
- Arjun Pandit
- 29 Mar, 2024
- Mumbai
Benchmark indexes in Shanghai advanced as investors reacted to the latest batch of earnings.
Financial markets in Hong Kong were closed for a public holiday.
Stock indexes gained for the second month in a row in Shanghai after banks reported better-than-expected earnings and investors looked ahead to the release of the official purchasing managers' index for manufacturing over the weekend.
Market watchers are expecting the manufacturing activity index to increase after falling for five months in a row.
The CSI 300 index edged up 0.07% to 3,523.43.
Four of the of the largest banks in China said their non-performing loans will increase in 2023, but banks have provisioned for loan losses primarily linked to construction activities and property developers.
Banks warned that falling real estate prices and weakening economic growth are likely to jeopardize banks' earnings and damage the value of the collateral held against those loans.
Agriculture Bank of China, the third-largest bank by assets in China, increased 2.2% to 4.26 yuan after the state-controlled bank reported steady earnings, despite the decline in net interest margin and rise in bad loans.
Net profit in 2023 jumped 4.2% to 269.8 billion yuan, or $37.3 billion, and the bank's non-performing loan ratio improved to 1.33% from 1.37%, declining for the third year in a row.
Bad loans increased from 32.3 billion yuan to 320.1 billion yuan, and the bank's classified or special mention loans improved to 1.42% from 1.46%.
China Construction Bank, the second-largest bank by assets in China, increased 1.1% to 6.91 yuan after the bank reported 2023 net profit increased 2.3% to 332.5 billion yuan.
The bank's net interest margin dropped to 1.7% from 2.01%, and the non-performing loan ratio improved to 1.37% from 1.38% a year ago, respectively.
Bank of China, the largest bank by assets in China, increased 1.1% to 4.43 yuan after the bank reported 2023 net profit rose 2.4% to 231.9 billion yuan.
Net interest margin eased to 1.59% from 1.75%, and the non-performing loan ratio improved to 1.27% from 132% a year ago, respectively.
Postal Savings Bank of China gained 0.6% to 4.79 yuan after the bank reported 2023 net profit increased by 1.25% from a year ago to 86.4 billion yuan.
The bank's net interest margin declined to 2.01% from 2.2%, and the non-performing loan ratio eased to 0.83% from 0.84% a year ago, respectively.
On Thursday, ICBC said its bad loans increased 10% to 353.5 billion yuan in 2023, and the company said in a briefing to investors that all major metrics are "within a healthy range" and these indicators are either stable or improving.
- Barry Adams
- 28 Mar, 2024
- New York City
Benchmark indexes traded flat, and stocks lacked direction in thin trading ahead of the three-day weekend.
The S&P 500 index and the Nasdaq Composite are set to close higher for the week, the month, and the quarter.
Investors bid up stocks and extended the market rally from the previous quarter on the continued boom in artificial intelligence, resilient corporate earnings, and growing optimism about the interest rate cut later in the year.
The S&P 500 index is up about 10.7% in the first quarter, 3.6% in March, and 0.3% in the week.
The Nasdaq Composite is up 11% in the quarter, 2.8% in March, and down 0.08% in the week.
Among the top 20 financial markets around the world, the Nikkei index led with a rise of 20.7%, followed by the indexes gaining in Germany around 11%, in the U.S. around 10%, in France 9%, and in India around 2%.
The benchmark indexes in London, Shanghai, Seoul, and Sydney gained around 3% in the first quarter.
The Hang Seng Index in Hong Kong was the lone decliner, with a loss of 1.5%.
The U.S. economic growth estimate for the fourth quarter was revised higher to 3.4% from the previous estimate of 3.2%, the Bureau of Economic Analysis reported Thursday.
In the third estimate, the agency left the 2023 economic growth estimate unchanged at 2.5%.
Investors are looking forward to the release of the personal income and outlays report and personal consumption expenditure price index on Friday, and the market will react to these reports when trading resumes on Monday following the Good Friday holiday.
U.S. Indexes and Yields
The S&P 500 index increased 0.08% to 5,253.07, and the Nasdaq Composite fell 0.05% to 16,390.63.
The yield on 2-year Treasury notes increased to 4.62%, 10-year Treasury notes inched up to 4.22%, and 30-year Treasury bonds edged down to 4.36%.
WTI crude oil increased $1.19 to $82.53 a barrel, and natural gas prices decreased 6 cents to $1.69 a thermal unit.
Gold increased by $22.49 to $2,214.50 an ounce, and silver rose 8 cents to $24.74.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.55.
U.S. Stock Movers
MillerKnoll plunged 17.3% to $25.31 after the steel furniture company reported weaker-than-expected revenue of $872.3 million in its latest quarter. Adjusted earnings per share of 45 cents were ahead of market expectations.
RH rose 9.4% to $325.0 after the furniture retailer reported weaker-than-expected quarterly financial results, and the company guided sales to decline by a low single digit in the current quarter.
However, stock advanced after the retailer estimated an improving demand trend for the remainder of the year.
Verint Systems rose 3.1% to $32.06 after the customer engagement software system developer reported better-than-expected quarterly results.
Revenue in the quarter increased to $265.1 million, and adjusted earnings per share were $1.07.
Sprinklr increased 12.4% to $14.59 after the social media marketing and content management software developer reported better-than-expected quarterly results.
Revenue increased to $194.2 million, and adjusted earnings per share were 13 cents.
Home Depot declined 0.7% to $383.37 after the retailer announced its plan to buy the building materials supplier SRS Distribution for $18.25 billion.
The deal is expected to enlarge company's offering to its professional customer base.
European Markets Trimmed Gains In Tight Trading
European markets advanced, bond yields eased, and the euro and the pound drifted lower.
Benchmark indexes in Paris and Frankfurt inched higher in record territory and extended weekly gains ahead of the Easter holiday on Friday and Monday.
The DAX index extended its holiday-shortened weekly gain to 1.8%, the CAC-40 gained 1.2%, and the FTSE 100 index advanced 1%.
In March, the DAX gained 5%, the CAC-40 index advanced 3.2%, and the FTSE 100 index increased 4.5%.
In the quarter, the DAX increased 10.3%, the CAC-40 jumped 9.0%, and the FTSE 100 index gained 3.2%.
Investors bid up stocks in the hope that the European Central Bank is likely to lower its rate as early as June after the Riksbank on Wednesday held its policy rate steady and suggested a possible rate cut in May or June.
The UK economy was confirmed to be in a technical recession, according to the latest data released by the Office for National Statistics.
The UK's economy contracted by 0.3% in the fourth quarter, as previously estimated, after shrinking by 0.1% in the third quarter, according to the final data released by the statistical agency.
With the economy in a technical recession towards the end of the year, gross domestic product rose only 0.1% in 2023, sharply lower than 4.3% in 2022.
German Retail Sales Extend Decline to Fourth Month
German retail sales unexpectedly declined in February after consumers retrenched to basics amid elevated interest rates and high inflation.
Retail sales declined for the fourth month in a row to 1.9% in February, and the decline was the steepest since October 2022, the Federal Statistical Office, destatis, reported Thursday.
Retail sales declined 2.7% from a year ago, fell for the fourth month in a row, and fell at the fastest pace in five months.
Food sales declined 1.7%, and non-food item sales dropped 1.0%.
Real calendar and seasonally adjusted sales in non-food retail fell by 1.0% in February compared to the previous month and by 2.6% compared to a year ago.
Real sales in Internet and mail order sales in February declined 2.8% compared to the previous month and dropped 4.7% from a year ago.
German Payrolls Expanded at a Slower pace.
The German job market expanded at a slower pace in February compared to the previous month.
Seasonally adjusted payrolls increased by 14,000 following the expansion of 56,000 in January, and about 45.7 million people were employed in Germany, according to the preliminary calculation by the statistical agency.
Germany's jobless rate increased after the expanding job market attracted more people to the labor force.
The German unemployment rate rose to 3.5% in February from 3.0% in the corresponding month a year ago, Destatis reported Thursday in a separate report.
About 1.55 million people were unemployed in February, an increase of 14.3%, or 193,000, compared to a year ago.
Adjusted for seasonal and irregular effects, the number of unemployed people was 1.41 million in February, 5,000 higher than in the previous month of January.
The adjusted unemployment rate is unchanged from the previous month of January, at 3.2%.
Europe Indexes and Yields
The DAX index increased by 0.1% to 18,495.11, the CAC-40 index rose by 0.07% to 8,210.56, and the FTSE 100 index inched higher by 0.3% to 7,961.53.
The yield on 10-year German bonds edged down to 2.31%; French bonds inched lower to 2.81%; the UK gilts edged lower to 3.99%; and Italian bonds inched lower to 3.66%.
The euro edged higher to $1.077, the British pound inched higher to $1.259, and the U.S. dollar held steady at 90.60 Swiss cents.
Brent crude decreased $1.0 to $86.41. a barrel, and the Dutch TTF natural gas fell by €0.24 to €27.45 per MWh.
Europe Stock Movers
Renault SA advanced 1.1% to €46.96 after the company sold 99.13 million shares, or about 2.5%, to Nissan for €358 million and participated in the company's stock repurchase program.
Casino Guichard Perrachon plunged 66% to €0.036 after the retailer announced the completion of its financial restructuring.
Stratec SE dropped 9.8% to €38.55 after the German maker of in-vitro diagnostic analyzers reported a decline in 2023 profit due to a fall in sales and an increase in expenses.
Profit Booking Drives Tokyo Stocks Lower
In Asia, the Nikkei 225 Stock Average fell more than 1% on profit-taking and the worries of an intervention to support the falling yen, which is hovering near a 34-year low.
Stocks in Tokyo closed lower on the final day of the holiday-shortened week as investors booked profits in tech and financial stocks.
The yen traded at 151.43 against the U.S. dollar after finance ministry officials stepped up their verbal intervention efforts in support of the yen, despite the Bank of Japan ending its negative rate regime last week.
Investors are looking forward to the release of industrial output, retail sales, and unemployment data on Friday.
The Nikkei 2225 Stock Average dropped 1.5% to 40,162.65, and the Topix index dropped 1.7% to 2,751.92.
SoftBank, Tokyo Electron, Screen Holdings, and Advantest declined between 0.2% and 1%, but FANUC advanced 0.5%.
Among vehicle markers, Honda Motor, Toyota Motor, Nissan Motor, Suzuki Motor, and Subaru Corp. traded between 0.5% gain and 1.6% fall.
Mitsubishi UFJ, Mizuho Financial Group, and Sumitomo Mitsui declined between 0.3% and 1.2%.
The Chinese President Assures Foreign Leaders of Additional Reforms
Stocks in Shanghai and Hong Kong advanced following better-than-expected earnings from China Life, Haier Smart Home, and ICBC.
Investors have shifted their attention to corporate earnings and economic data flow after the market intervention by government-controlled funds lifted broader indexes by more than 10% in February.
President Xi Jinping met with a with a delegation of U.S. business leaders and pledged to create a more market-friendly business environment for foreign investors.
The meeting between President Xi and the U.S. business leaders, including senior executives from Pfizer, FedEx, Blackstone, Qualcomm, and Bloomberg, was held at the end of the China Development Forum in Beijing on Wednesday.
Xi proposed deepening economic reform that is "market-oriented" and "law-based" to create more room for foreign businesses and rejected the narrative that China's economic growth has peaked.
However, Chinese policymakers have stepped up efforts to support state-controlled large enterprises at the expense of the private sector and curtail the activities of foreign businesses.
Moreover, small and medium-sized foreign businesses have started leaving China in droves and shifting their business activities to neighboring Vietnam, Mexico, or other markets in India and ASEAN countries.
The Chinese government's support of widespread intellectual property theft and recent stringent controls on profit repatriation have also accelerated the sharp decline in foreign direct investment in the last four years.
Financial markets are closed on Friday and Monday for public holidays in Hong Kong, but markets will remain open for business in mainland China.
The CSI 300 index increased 1.1% to 3,542.0, and the Hang Seng index added 1.6% to 16,660.76.
Haier Smart Home rose 7.5% to HK$24.20 after the maker of consumer appliances reported better-than-expected 2023 financial results.
China Life Insurance rose 5.4% to HK$9.41 after the largest insurance company in China reported a smaller-than-expected 31% decline in earnings in 2023.
ICBC Bank declined 3.4% to HK$3.94 after the financial services company reported weaker-than-expected 2023 financial results.
India Indexes Extend Weekly Gains
Benchmark indexes in Mumbai advanced ahead of a 3-day weekend in light trading.
The Sensex and the Nifty indexes gained a fraction and inched into record territory as investors debated the global interest rate outlook.
Investors are hoping that interest rate cuts in the U.S. and the eurozone may encourage the Reserve Bank of India to lower domestic rates.
However, persistently high inflation may delay a rate cut, and the Federal Reserve may decide to keep higher rates for longer.
The Sensex index increased 0.5% to 73,360.05, and the Nifty index edged up 0.5% to 22,225.40.
Two popular indexes extended holiday-shortened weekly gains to 1.3%.
On the Mumbai stock exchange, 47 stocks traded at their 52-week highs and 56 stocks traded at their 52-week lows.
The yield on the 10-year Indian government bonds decreased to 7.04%, and the Indian rupee edged lower to ₹83.35 against the U.S. dollar.
Cooler Inflation Lifts Australian Index to a New Record High
Australian stock market indexes traded at a new record high after consumer price inflation in February was weaker than expected at 3.4%.
Australian indexes advanced in the hopes that the two-year low inflation rate for the third month in a row in February may spur the central bank to lower the policy rate.
The ASX 200 index gained 1% to close at 7,896.90, a new record high.
The benchmark index advanced 3% in March and jumped 3.6% in the first quarter of 2024.
- Scott Peters
- 28 Mar, 2024
- New York City
MillerKnoll plunged 17.3% to $25.31 after the steel furniture company reported weaker-than-expected revenue in its latest quarter.
Net sales in the fiscal third quarter ending on March 2 declined 11.4% to $872.3 million from $984.7 million, net income rose to $23.1 million from $1.1 million, and diluted earnings per share advanced to 30 cents from 1 cent a year ago.
The company offered a lukewarm revenue and earnings outlook in the current quarter, citing a "near-term tepid macroeconomic backdrop."
The company guided net sales in the fiscal fourth quarter to fall between $880 million and $920 million and diluted earnings per share to 49 cents and 57 cents, an increase of 29% from a year ago based on the midpoint of the earnings range.
The furniture maker also estimated full-year earnings to range between $1.90 and $19.98.
RH rose 9.4% to $325.0 after the furniture retailer reported weaker-than-expected quarterly financial results, and the company guided sales to decline by a low single digit in the current quarter.
However, stock advanced after the retailer estimated an improving demand trend for the remainder of the year.
Net revenue in the fiscal fourth quarter ending on February 3 declined to $738.2 million from $772.5 million, net income declined to $11.4 million from $106.9 million, and diluted earnings per share fell to 57 cents from $4.21 a year ago.
"Due to the extensive transformation of our assortment, we do expect revenue to lag demand during the year by approximately 4 to 8 points until we read and react to the new collections, reduce backorders, and shorten special order lead times," the company added in the letter to shareholders.
Full-year revenue declined to $3.02 billion from $3.6 billion, net income plunged to $127.5 million from $528.6 million, and diluted earnings per share dropped to $5.91 from $19.91 a year ago.
Verint Systems rose 3.1% to $32.06 after the customer engagement software system developer reported better-than-expected quarterly results.
Revenue in the fiscal fourth quarter increased 12% to $265.1 million from $236.2 million, net income increased to $28.9 million from $13.1 million, and diluted earnings per share advanced to 37 cents from 12 cents a year ago.
The company guided fiscal 2025 revenue to be around $930 million, an increase of 5% from a year ago after adjusting for managed service unit divestiture.
Diluted earnings per share are expected to increase by 6% to $2.89.
Sprinklr increased 12.4% to $14.59 after the social media marketing and content management software developer reported better-than-expected quarterly results.
Revenue increased 17.2% to $194.2 million from $165.3 million, net income was $21.1 million compared to a loss of $0.7 million, and diluted earnings per share were 8 cents compared to zero a year ago.
For the fiscal year 2024 ending in January, revenue increased to $732.2 million from $618.2 million, net income rose to $51.4 million from a loss of $55.7 million, and diluted earnings per share were 19 cents compared to a loss of 21 cents a year ago.
For the fiscal first quarter, the company estimated total revenue between $194 million and $195 million and non-GAAP operating earnings between $19.5 million and $20.5 million.
For the fiscal year 2025, the company estimated total revenue between $740 million and $741.5 million and non-GAAP operating income between $104 million and $105 million.