- Scott Peters
- 24 Jan, 2023
- New York City
3M Company declined 5.5% to $115.85 after the company posted mixed quarterly results.
Fourth quarter revenue declined 6% to $8.1 billion, reflecting impacts of negative 2% from divestitures and negative 5% from foreign currency translation on the strong U.S. dollar.
Net income in the quarter declined to $541 million from $1.3 billion and diluted earnings per share dropped to 98 cents from $2.31 in the previous year.
In the quarter, the company returned $1.4 billion to shareholders through dividends and stock repurchases.
In December 2022, 3M announced it will exit per- and polyfluoroalkyl substance manufacturing by the end of 2025 and the company is also facing investigations from California's Attorney General office.
The company estimated full-year 2023 sales to fall between 2 % and 6% and adjusted earnings per share between $8.50 and $9.0 including a pre-tax restructuring charge between $75 million and $100 million.
Alphabet Inc declined 1.4% to $99.85 after the parent of Google was sued by the U.S. Justice Department for the second time in as many years.
The latest suit targets its advertising business which generated a total of $54.6 billion and seeks the company to divest part of its operations.
The company is also facing antitrust lawsuits from several other states and California, Colorado, New York, New Jersey, Rhode Island and Connecticut joined the latest DOJ suit.
D.R. Horton Inc increased 2% to $97.68 after the homebuilder reported better-than-expected earnings.
Revenue in the fiscal first quarter ending in December increased 3% to $7.3 billion and net income decreased 16% to $958.7 million from $1.1 billion and diluted earnings per share fell to $2.76 from $3.17 in the previous year.
Home building revenue increased 1% to $6.74 billion from $6.68 billion in the same quarter of fiscal 2022.
Homes closed in the quarter decreased 6% to 17,340 homes compared to 18,396 homes closed in the same quarter a year ago.
Net sales orders for the fiscal first quarter decreased 38% to 13,382 homes and 40% to $4.9 billion compared to 21,522 and $8.3 billion in the same quarter of the prior year.
Order cancelation rate increased to 27% in the first quarter from 15% in the prior-year quarter.
Johnson & Johnson declined 1% to $166.71 after the healthcare company reported quarterly results that met investors expectations but the company's forward guidance was weaker-than-anticipated.
Sales in the quarter declined 4.4% to $23.71 billion from $24.80 billion in the similar quarter last year, primarily because of lower Covid-19 vaccine sales and unfavorable exchange rate.
Net earnings declined 25.9% to $3.52 billion or $1.33 per share from $4.74 billion or $1.77 per share in the quarter a year ago.
US sales rose 2.9% to $12.52 billion and international sales dropped 11.5% to $11.19 billion from last year.
The company estimated adjusted earnings per share in a range of $10.45 to $10.65 and adjusted operating earnings per share in a range of $10.40 to $10.60.
Lockheed Martin Corp gained 1.4% or $5.98 after the defense contractor reported sales and adjusted earnings ahead of expectations.
Lockheed said revenue in the fourth quarter increased to $19.0 billion from $17.7 billion but net income declined to $1.9 billion from $2.0 billion or diluted earnings per share fell to $7.40 from $7.47 in the previous year.
In full-year 2022, sales decreased to $66 billion from $67 billion and net income declined to $5.7 billion from $6.3 billion and diluted earnings per share dropped to $21.66 from $22.76 in the previous year.
Raytheon Technologies Corp increased 1.8% or $1.69 to $97.92 after the defense contractor benefitted from arms sales for Ukraine and the company said it plans to reorganize in three business units.
Fourth quarter revenue increased 6% to $18.1 billion from $17.04 billion and net income doubled to $1.4 billion from $685 million and diluted earnings per share rose to 96 cents from 46 cents a year ago.
Backlog at the end of the fourth quarter was $175 billion, of which $106 billion was from commercial aerospace and $69 billion was defense orders.
Verizon Communications Inc increased 80 cents to $39.75 after the company reported mixed quarterly results.
Fourth quarter total operating revenue increased 3.5% to $35.25 billion from $34.1 billion and net income increased 41% to $6.7 billion from $4.7 billion and diluted earnings per share rose to $1.56 from $1.11 in the previous year.
Broadband Internet accounts increased 416,000 and wireless postpaid connections increased 217,000 to 143 million and churn rate was 1.14%.
The company guided total wireless revenue growth in 2023 between 2.5% and 4.5% and capital expenditure between $18.25 billion and $19.25 billion.
- Barry Adams
- 24 Jan, 2023
- New York City
Stocks faced selling pressure in morning trading after two days of gains and investors took profit in tech stocks.
Investors also digested a fresh batch of earnings from Verizon, Johnson & Johnson and Lockheed Martin and await earnings from 300 more companies this week.
On the economic front, investors are also looking to gain clues on the economy after the release of durable goods orders, fourth quarter GDP, new home sales and personal income and spending later in the week.
The S&P 500 index fell 3.11 points to 4,016.70 and the Nasdaq Composite index decreased 2.6 to 11,361.82.
Energy Prices Lacked Direction
Crude oil increased 14 cents to $81.73 a barrel and natural gas futures decreased 11 cents to $3.33 a thermal unit.
Treasury Yield Hovered Near Recent Lows
The yield on 2-year Treasury notes inched lower to 4.23%, 10-year Treasury notes hovered near 3.50% and 30-year Treasury bonds traded down to 3.67%.
US Stock Movers
Johnson & Johnson declined 1% to $166.71 after the healthcare company reported quarterly results that met investors expectations but the company's forward guidance was weaker-than-anticipated.
Sales in the quarter declined 4.4% to $23.71 billion from $24.80 billion in the similar quarter last year, primarily because of lower Covid-19 vaccine sales and unfavorable exchange rate.
Net earnings declined 25.9% to $3.52 billion or $1.33 per share from $4.74 billion or $1.77 per share in the quarter a year ago.
US sales rose 2.9% to $12.52 billion and international sales dropped 11.5% to $11.19 billion from last year.
The company estimated adjusted earnings per share in a range of $10.45 to $10.65 and adjusted operating earnings per share in a range of $10.40 to $10.60.
Verizon Communications Inc increased 80 cents to $39.75 after the company reported mixed quarterly results.
Lockheed Martin Corp gained 1.4% or $5.98 after the defense contractor reported sales and adjusted earnings ahead of expectations.
Raytheon Technologies Corp increased 1.8% or $1.69 to $97.92 after the defense contractor benefitted from arms sales for Ukraine and the company said it plans to reorganize in three business units.
European Markets Pause On Rate Hike Worries
European markets were on the backfoot after aggressive rate hike worries returned following the release of business activities index.
The S&P Global Composite Purchasing Managers' Index increased to 50.2 in January 2023 from 49.3 in December 2022 after falling for six months in a row.
The rebound in service activities in pharmaceuticals, healthcare and technology and smaller contraction in manufacturing activities improved the index.
The DAX index decreased 0.3% to 15,057.73, the CAC-40 index traded up a fraction to 7,032.26 and the FTSE !00 index decreased 0.4% to 7,755.79.
The U.S. dollar hovered near a 9-month low on the hopes that the Federal Reserve will moderate its aggressive rate hike posture and pivot to smaller rate increases at the meeting next week.
The euro inched lower to $1.08, the British pound traded near $1.228 and the Swiss franc hovered near 92.63 U.S. cents.
The yield on 10-year German Bunds increased to 2.20%, French bonds to 2.64%, the UK Gilts to 3.33% and Italian bonds to 3.997%.
Natural gas prices fell for the second day in a row and dropped near a 16-month low as cold snap faded and warmer-than-usual temperatures are expected to return this week.
Brent crude oil decreased 12 cents to $88.06 a barrel and the Dutch TTF natural gas dropped 9.7% to €59.60 per MWh.
Tech Stocks Drive Nikkei Higher Second Day In a Row
Benchmark index in Tokyo closed higher following a surge in tech stocks tracking gains in New York trading.
The Nikkei index closed at 5-week high on the back of a rebound in tech stocks and investors awaited corporate earnings.
The Nikkei 225 index increased 1.5% to 27,299.19 and the yen firmed 18 cents to 130.48 against the U.S. dollar.
GS Yuasa Corp increased 3.8% to ¥2,255.0 after the company announced a joint venture with Honda Motor Corp to make advanced Lithium-Ion batteries.
Honda Motor Corp increased 1.2% to ¥3,129.0.
Most markets in the region were closed to celebrate the Lunar New Year.
Markets in mainland China, Hong Kong, Taiwan, Singapore, Malaysia and South Korea were closed.
India Awaits Union Budget Measures
Indian stocks lacked direction ahead of the Republic day holiday on Thursday and investors reacted to latest earnings from vehicles makers Maruti Suzuki and TVS Motor.
Investors are also awaiting the central government budget next week and looking for clues on incentives to accelerate the manufacturing sector and infrastructure spending.
The Sensex index increased 0.06% or 37.08 to 60,978.75 and the Nifty index traded down 0.25 points to 18,118.30.
The rupee closed down 11 paisa to 81.59 against the U.S. dollar.
Maruti Suzuki said revenue in the December quarter increased 27% to ₹29,905 crore and net income rose 66.4% to ₹2,135 crore and diluted earnings per share jumped to ₹77.84 from ₹33.48 a year ago.
TVS Motor said the December quarter revenue increased 15% to ₹6,076 crore and net income increased to ₹352 crore from ₹288 crore and diluted earnings per share rose to ₹7.42 from ₹6.07 a year ago.
- Bridgette Randall
- 24 Jan, 2023
- Frankfurt
European markets were on the backfoot after aggressive rate hike worries returned following the release of business activities index.
Stocks lacked direction in choppy trading after natural gas prices plunged but the rebound in business activities rekindled the worries of aggressive rate hikes at the next policy meetings in February and March.
European Business Activities Rebound
The S&P Global Composite Purchasing Managers' Index increased to 50.2 in January 2023 from 49.3 in December 2022 after falling for six months in a row.
The rebound in service activities in pharmaceuticals, healthcare and technology and smaller contraction in manufacturing activities improved the index.
European Market Indexes Paused
European indexes paused as investors weighed earnings optimism and weakening energy prices against the rate hike worries.
The DAX index decreased 0.3% to 15,057.73, the CAC-40 index traded up a fraction to 7,032.26 and the FTSE !00 index decreased 0.4% to 7,755.79.
Dollar Hovers Near 9-month Low
The U.S. dollar hovered near a 9-month low on the hopes that the Federal Reserve will moderate its aggressive rate hike posture and pivot to smaller rate increases at the meeting next week.
The euro inched lower to $1.08, the British pound traded near $1.228 and the Swiss franc hovered near 92.63 U.S. cents.
Bond Yields Advanced On Rate Hike Worries
The yield on 10-year German Bunds increased to 2.20%, French bonds to 2.64%, the UK Gilts to 3.33% and Italian bonds to 3.997%.
Natural Gas Prices Drops 10%
Natural gas prices fell for the second day in a row and dropped near a 16-month low as cold snap faded and warmer-than-usual temperatures are expected to return this week.
Brent crude oil decreased 12 cents to $88.06 a barrel and the Dutch TTF natural gas dropped 9.7% to €59.60 per MWh.
French Services Contracted In January
The French service sector contracted for the third month in a row, S&P Global Service PMI data showed Tuesday.
French Service PMI declined to 49.2 in January 2023 from 49.5 in December 2022, third monthly decline in a row and the sharpest pace since March 2021.
New order flows declined on the persistent economic uncertainties and higher inflation and rising borrowing costs but on the positive side new job addition rate improved.
British Manufacturing Weakness Persists
The British manufacturing sector continued to face headwinds amid persistent high inflation and energy prices and economic uncertainties, data from the Confederation of British Industries showed Tuesday.
The order book balance declined 11 points in January to -17 from December, the weakest since February 2021 according to the latest Industrial Trends Survey.
The price expectations for the next three months eased to +41 from +52 in December on the easing of supply chain constraints and labor shortages and falling natural gas prices.
UK Borrowings Soared In December
The UK budget deficit widened to the record December-level after the government revved up energy subsidies and higher rates lifted interest payments.
Public sector net borrowing, excluding government controlled banks, increased to £27.4 billion, record high since monthly records began in January 1993, the Office for National Statistics reported Tuesday.
December’s borrowing was £16.7 billion higher from the previous year and £9.8 billion higher than the latest official forecast published by the Office for Budget Responsibility.
Central government debt interest payable increased to £17.3 billion in December 2022, the highest December payment since monthly records began.
Europe Stock Movers
Associated British Foods Plc declined 2.2% to 1,829.0 pence after the owner of Primark said revenue in the 16-week period ending on January 7 rose 20% to £6,698 million.
Revenue in constant currency rose 16% and the stronger U.S. dollar drove the nominal exchange rate based revenues.
"We continue to encounter significant cost pressures but inflation has become less volatile and recently some commodity costs have declined.
Consumer spending has proven to be more resilient in this trading period than anticipated at the start of the financial year," the company said in its latest trading update.
For the full year, the company estimated "result overall is unchanged with a significant growth in sales, and adjusted operating profit and adjusted earnings per share to be lower than the previous financial year."
Technip Energies NV declined 1.9% to €16.93 despite the company winning a contract in Saudi Arabia.
Saudi Arabia-based Aramco awarded a contract to modernize sulfur recovery facilities to the French engineering and technology company.
Marston's Plc increased 6.2% to 43.42 pence after the pubs operator said sales increased during holiday period.
Comparable sales in the 16-week period ending on January 21 increased 20% from the previous year.
Comparable sales in the five-day holiday period, Christmas Eve, Christmas Day, Boxing Day, New Year’s Eve and New Year’s Day, jumped 26% and sales in the similar period two-years ago rose 12.9%.
The company said total retail sales at the company owned and managed and franchised pubs were up 14.0% on last year and up 7.3% from the fiscal year 2020.
Beverage sales continued to outperform food sales.
- Bridgette Randall
- 24 Jan, 2023
- Frankfurt
Associated British Foods Plc declined 2.2% to 1,829.0 pence after the owner of Primark said revenue in the 16-week period ending on January 7 rose 20% to £6,698 million.
Revenue in constant currency rose 16% and the stronger U.S. dollar drove the nominal exchange rate based revenues.
"We continue to encounter significant cost pressures but inflation has become less volatile and recently some commodity costs have declined.
Consumer spending has proven to be more resilient in this trading period than anticipated at the start of the financial year," the company said in its latest trading update.
For the full year, the company estimated "result overall is unchanged with a significant growth in sales, and adjusted operating profit and adjusted earnings per share to be lower than the previous financial year."
Technip Energies NV declined 1.9% to €16.93 despite the company winning a contract in Saudi Arabia.
Saudi Arabia-based Aramco awarded a contract to modernize sulfur recovery facilities to the French engineering and technology company.
Marston's Plc increased 6.2% to 43.42 pence after the pubs operator said sales increased during holiday period.
Comparable sales in the 16-week period ending on January 21 increased 20% from the previous year.
Comparable sales in the five-day holiday period, Christmas Eve, Christmas Day, Boxing Day, New Year’s Eve and New Year’s Day, jumped 26% and sales in the similar period two-years ago rose 12.9%.
The company said total retail sales at the company owned and managed and franchised pubs were up 14.0% on last year and up 7.3% from the fiscal year 2020.
Beverage sales continued to outperform food sales.
- Arjun Pandit
- 24 Jan, 2023
- Mumbai
Benchmark index in Tokyo closed higher following a surge in tech stocks tracking gains in New York trading.
The Nikkei index closed at 5-week high on the back of a rebound in tech stocks and investors awaited corporate earnings.
The Nikkei 225 index increased 1.5% to 27,299.19 and the yen firmed 18 cents to 130.48 against the U.S. dollar.
GS Yuasa Corp increased 3.8% to ¥2,255.0 after the company announced a joint venture with Honda Motor Corp to make advanced Lithium-Ion batteries.
Honda Motor Corp increased 1.2% to ¥3,129.0.
Most markets in the region were closed to celebrate the Lunar New Year.
Markets in mainland China, Hong Kong, Taiwan, Singapore, Malaysia and South Korea were closed.
Indian stocks lacked direction ahead of the Republic day holiday on Thursday and investors reacted to latest earnings from vehicles makers Maruti Suzuki and TVS Motor.
Investors are also awaiting the central government budget next week and looking for clues on incentives to accelerate the manufacturing sector and infrastructure spending.
The Sensex index increased 0.06% or 37.08 to 60,978.75 and the Nifty index traded down 0.25 points to 18,118.30.
The rupee closed down 11 paisa to 81.59 against the U.S. dollar.
Maruti Suzuki said revenue in the December quarter increased 27% to ₹29,905 crore and net income rose 66.4% to ₹2,135 crore and diluted earnings per share jumped to ₹77.84 from ₹33.48 a year ago.
TVS Motor said the December quarter revenue increased 15% to ₹6,076 crore and net income increased to ₹352 crore from ₹288 crore and diluted earnings per share rose to ₹7.42 from ₹6.07 a year ago.
- Barry Adams
- 23 Jan, 2023
- New York City
Tech stocks led the charge for the second day in a row after investors warmed up to less aggressive rate hikes and adjusted earnings outlook as businesses prepare for economic slowdown.
Market sentiment was positive on the hopes that more policymakers may support a smaller rate hike at the Fed's meeting next week despite the tight labor market conditions.
Earnings calendar also dominated market focus as investors seek more insights in how companies are handling cost inflation and dealing with decelerating demand.
About 400 companies are scheduled to release earnings including Visa, MasterCard, IBM, General Electric, Verizon, Boeing, General Dynamics and Hess Corp.
Spotify SA was the latest tech company to announce significant job cuts as tech companies prepare for a different economic reality after the pandemic-driven boom.
Market exuberance was driven in part on the hopes of a rebound in China business activities after China pivoted from "zero-covid" to "peak infection" policy.
The positive sentiment was also supported by Japan scaling back its antivirus measures and reopening borders as early as this spring.
India was in focus after Amazon.com Inc said it plans to launch its air cargo service in India, one of the fastest growing e-commerce markets.
Apple also plans to increase its iPhones production in India from 5% to 7% to 25% and local reports suggested that the company exported $1 billion of phones from India in December.
Apple launched its latest iPhone model from the fast-growing economy.
The S&P 500 index increased 1.1% to 4,019.65 and the Nasdaq Composite index advanced 2.0% to 11,364.41.
Lumber futures in Chicago trading continued to rebound from the low $330 a thousand board feet reached on January 13 to close at $437.70 as real estate activities remained depressed.
Crude Oil Advance to 2-month High
Crude oil traded near a 2-month high as investors assess global demand and supply and brace for additional sanctions on Russian oil from the European Union and the U.S.
Crude oil decreased 8 cents to $81.65 a barrel and natural gas edged higher 26 cents to $3.44 a thermal unit.
U.S. Treasury Yields Hold Firm
The yield on 2-year Treasury notes inched higher to 4.24%, 10-year Treasury notes edged up to 3.52% and 30-year Treasury bonds increased to 3.70%.
U.S. Stock Movers
Tech stocks advanced on the hopes of slower rate hikes and Netflix soared 4% and Microsoft, Amazon.com, IBM and Adobe gained between 1% and 2%.
AMD soared 9% and Intel gained 4% on the hopes of a rebound in sales as Chinese economy gathers pace after a weeklong holiday to mark the new Lunar Year.
Qualcomm jumped 6% and Microchip Technology advanced 4%.
Apple Inc rose 3.2% to $142.23 and the maker of popular computing devices is looking to diversify its manufacturing base following the rising tensions between China and the U.S.
Apple Inc plans to increase its iPhones production in India to 25% from the current 5% to 7%, commerce and industry minister Piyush Goyal said today.
Spotify Technology SA increased 2.2% to $100.22 after the audio streaming platform said it plans to trim its workforce by 6%.
Baker Hughes Company declined 1.1% to $30.74 after the oil services provider reported higher revenues but profit dropped in the fourth quarter.
Revenue increased 7.7% to $5.91 billion from $5.49 billion last year and net income dropped 38% to $182 million from $394 million and diluted earnings per share declined to 18 cents from 44 cents a year ago.
The oil services provider retained its positive outlook for the energy sector despite tightening monetary conditions and operating challenges under recessionary conditions.
Euro Area Sentiment Improved, Euro at New 9-month high
European markets closed higher and tech stocks led the gainers after positive sentiment supported broad market advance.
Benchmark indexes in the region advanced on the hopes of China's reopening, falling natural gas prices and slower rate hikes in the U.S. but the European policymakers supported aggressive rate hikes at the next meetings in February and March.
The Euro Area consumer sentiment index in January 2023 improved to the high not seen since February 2022 on the hopes of lower energy prices and the region may avoid a recession this year.
The sentiment index increased by 1.1 points to -20.9 in January, the European Commission said in a release Monday.
Broad Rally Power European Market Advance
The DAX index increased 0.5% to 15,102.95, the CAC-40 index rose 0.5% to 7,032.02 and the FTSE 100 index closed up 0.2% to 7,784.67.
The euro rose to a new 9-month high of $1.09 on the expectations of 50 basis points rate increases at least at the next meetings in February and March.
The euro inched higher to a new 9-month high of $1.09, the British pound edged lower to $1.233 and the Swiss franc closed down to 92.39 U.S. cents.
The yield on 10-year German Bunds advanced to 2.20%, French bonds traded higher to 2.65%, the UK Gilts to 3.35% and the Italian bonds to 4.01%.
Brent crude oil increased 49 cents to $88.12 a barrel and the Dutch TTF natural gas futures contract price fell 90 cents to €66.0 per MWh.
Europe Stock Movers
CNH Industrial NV gained 0.6% to €15.79 and the agriculture equipment maker was in focus after union workers ratified a new contract for two manufacturing locations in Iowa.
Balfour Beatty Plc increased 1.06% to 363.80 pence after the construction company won a 1.2 billion contract from National Highways to build 'Roads North of the Thames' network for the proposed Lower Thames Crossing.
Saga Plc increased 2.5% to 154.21 pence after the over-50 travel services provider said it is seeking a buyer for its in-house insurance underwriting operation.
Nokia Oyj increased 1.6% to €4.29 after the Finnish telecom company signed a cross-license patent agreement with Samsung Electronics.
National Express Group Plc increased 4.2% to 143.28 pence after the company said its German unit National Express Rail GmbH secured a one billion euros contract for rail operations in Germany.
Dignity Plc soared 8.5% to 545.0 pence after the company agreed to be acquired by a consortium of investment companies including Phoenix Asset Management Partners, Castelnau Group and SPWOne V Limited.
The company's board accepted a cash offer of 550 pence a share valuing the funeral homes operator at approximately £281 million on a fully diluted basis and an implied enterprise value of approximately £789 million.
The cash offer represents 29.3% premium to the closing price of 425.5 pence of Dignity Share on January 3.
Yen Drifts Lower, Tepco Seeks Higher Rates
Markets in Tokyo closed higher after the yen retreated from 7-1/2 month high reached last week and the Bank of Japan's minutes of meeting showed that the central bank took actions to improve bond market functioning.
The Bank of Japan left its ultraloose monetary policy intact after the two-day meeting ending on December 20 but the meeting was also adjourned for 30 minutes to allow government representatives to discuss with the finance ministry, highlighting the gravity of the decision.
Tokyo Electric Power Company declined 1.5% to ¥445.0 and the power utility company said it applied to the industry ministry to raise the residential utility rate by 30% from June to cover the higher fuel procurement expenses.
Tepco also estimated a financial year ending in March loss of ¥317 billion or $2.4 billion compared to a ¥5.64 billion profit in the previous year, due to higher natural gas import prices and elevated wholesale electricity costs.
The Nikkei 225 index added 1.3% to 26,906.04 and the yen closed at 130.63 against the U.S. dollar.
Infection Spike Worries China Investors
Markets in mainland China, Hong Kong, Singapore and South Korea were closed to celebrate the Lunar New Year.
Chinese markets will resume normal operations on January 30.
In Friday's trading, the Shanghai Composite index jumped 0.8% to 26,906.04 and the Hang Seng index advanced 1.8% to 22,044.65.
Bank Earnings Lift India Indexes
Stocks in Mumbai traded higher after five leading banks, Axis Bank, Canara Bank and ICICI Bank, IDBI and Kotak Mahindra reported higher than expected earnings.
Indian market sentiment was also positive after the U.S. Fed officials' comments supported smaller rate hikes in New York on Friday.
The Sensex index added 0.5% or 319.90 points to 60,941.67 and the Nifty index jumped 0.5% or 90.90 to 18,118.55.
The rupee edged lower to 81.30 against the U.S. dollar.
- Scott Peters
- 23 Jan, 2023
- New York City
Amazon.com Inc edged lower 0.3% to $96.96 after the company said it plans to expand its Amazon Prime air services connecting four major cities in India, one of the fastest growing e-commerce markets in the world.
Apple Inc rose 3.2% to $142.23 and the maker of popular computing devices is looking to diversify its manufacturing base following the rising tensions between China and the U.S.
Apple Inc plans to increase its iPhones production in India to 25% from the current 5% to 7%, commerce and industry minister Piyush Goyal said today.
Baker Hughes Company declined 1.1% to $30.74 after the oil services provider reported higher revenues but profit dropped in the fourth quarter.
Revenue increased 7.7% to $5.91 billion from $5.49 billion last year and net income dropped 38% to $182 million from $394 million and diluted earnings per share declined to 18 cents from 44 cents a year ago.
The oil services provider retained its positive outlook for the energy sector despite tightening monetary conditions and operating challenges under recessionary conditions.
CNH Industrial NV gained 0.06% to $17.04 in New York and added 0.6% to €15.79 in European trading and the agriculture equipment maker was in focus after union workers ratified a new contract for two manufacturing locations in Iowa.
Nokia Oyj increased 1.6% to €4.29 in European trading and gained 0.4% to $4.29 in New York after the Finnish telecom company signed a cross-license patent agreement with Samsung Electronics.
Spotify Technology SA increased 2.2% to $100.22 after the audio streaming platform said it plans to trim its workforce by 6%.
Tesla Inc increased 7.1% to $142.87 on the hopes that the rebounding business activities in China will enable the company to resume its production earlier than expected in the world's second-largest economy.
Wayfair Inc soared 22.9% to $57.51 after the online furniture platform said it plans to eliminate 1,750 jobs or about 10% of its staff citing macro headwinds and uncertain economic outlook.
JPMorgan analyst Christopher Horvers revised stock rating to "overweight" from "underweight" and lifted price target to $63 from $35 and cited "changing market share trends" and the company's "new found commitment to controlling investments and expenses."
- Bridgette Randall
- 23 Jan, 2023
- Frankfurt
CNH Industrial NV gained 0.6% to €15.79 and the agriculture equipment maker was in focus after union workers ratified a new contract for two manufacturing locations in Iowa.
Balfour Beatty Plc increased 1.06% to 363.80 pence after the construction company won a £1.2 billion contract from National Highways to build 'Roads North of the Thames' network for the proposed Lower Thames Crossing.
Saga Plc increased 2.5% to 154.21 pence after the over-50 travel services provider said it is seeking a buyer for its in-house insurance underwriting operation.
Nokia Oyj increased 1.6% to €4.29 after the Finnish telecom company signed a cross-license patent agreement with Samsung Electronics.
National Express Group Plc increased 4.2% to 143.28 pence after the company said its German unit National Express Rail GmbH secured a one billion euros contract for rail operations in Germany.
Dignity Plc soared 8.5% to 545.0 pence after the company agreed to be acquired by a consortium of investment companies including Phoenix Asset Management Partners, Castelnau Group and SPWOne V Limited.
The company's board accepted a cash offer of 550 pence a share valuing the funeral homes operator at approximately £281 million on a fully diluted basis and an implied enterprise value of approximately £789 million.
The cash offer represents 29.3% premium to the closing price of 425.5 pence of Dignity Share on January 3.
- Bridgette Randall
- 23 Jan, 2023
- Frankfurt
European markets closed higher and tech stocks led the gainers after positive sentiment supported broad market advance.
Benchmark indexes in the region advanced on the hopes of China's reopening, falling natural gas prices and slower rate hikes in the U.S. but the European policymakers supported aggressive rate hikes at the next meetings in February and March.
The Euro Area consumer sentiment index in January 2023 improved to the high not seen since February 2022 on the hopes of lower energy prices and the region may avoid a recession this year.
The sentiment index increased by 1.1 points to -20.9 in January, the European Commission said in a release Monday.
Broad Rally Power European Market Advance
The DAX index increased 0.5% to 15,102.95, the CAC-40 index rose 0.5% to 7,032.02 and the FTSE 100 index closed up 0.2% to 7,784.67.
The euro rose to a new 9-month high of $1.09 on the expectations of 50 basis points rate increases at least at the next meetings in February and March.
The euro inched higher to a new 9-month high of $1.09, the British pound edged lower to $1.233 and the Swiss franc closed down to 92.39 U.S. cents.
The yield on 10-year German Bunds advanced to 2.20%, French bonds traded higher to 2.65%, the UK Gilts to 3.35% and the Italian bonds to 4.01%.
Brent crude oil increased 49 cents to $88.12 a barrel and the Dutch TTF natural gas futures contract price fell 90 cents to €66.0 per MWh.
Europe Stock Movers
CNH Industrial NV gained 0.6% to €15.79 and the agriculture equipment maker was in focus after union workers ratified a new contract for two manufacturing locations in Iowa.
Balfour Beatty Plc increased 1.06% to 363.80 pence after the construction company won a 1.2 billion contract from National Highways to build 'Roads North of the Thames' network for the proposed Lower Thames Crossing.
Saga Plc increased 2.5% to 154.21 pence after the over-50 travel services provider said it is seeking a buyer for its in-house insurance underwriting operation.
Nokia Oyj increased 1.6% to €4.29 after the Finnish telecom company signed a cross-license patent agreement with Samsung Electronics.
National Express Group Plc increased 4.2% to 143.28 pence after the company said its German unit National Express Rail GmbH secured a one billion euros contract for rail operations in Germany.
Dignity Plc soared 8.5% to 545.0 pence after the company agreed to be acquired by a consortium of investment companies including Phoenix Asset Management Partners, Castelnau Group and SPWOne V Limited.
The company's board accepted a cash offer of 550 pence a share valuing the funeral homes operator at approximately £281 million on a fully diluted basis and an implied enterprise value of approximately £789 million.
The cash offer represents 29.3% premium to the closing price of 425.5 pence of Dignity Share on January 3.
- Barry Adams
- 23 Jan, 2023
- New York City
Stocks on Wall Street traded higher as investors await a flood of corporate earnings this week.
Market sentiment was positive on the hopes that more policymakers may support a smaller rate hike at the next Fed's meeting next week despite the tight labor market conditions.
Spotify SA was the latest tech company to announce significant job cuts as tech companies prepare for a different economic reality after the pandemic-driven boom.
Market exuberance was driven in part on the hopes of a rebound in China business activities after China pivoted from "zero-covid" to "peak infection" policy.
The positive sentiment was also supported by Japan scaling back its antivirus measures and reopening borders as early as this spring.
The S&P 500 index increased 1.7% to 4,039.09 and the Nasdaq Composite index advanced 2.4% to 11,404.88.
Crude Oil Advance to 2-month High
Crude oil traded near a 2-month high as investors assess global demand and supply and brace for additional sanctions on Russian oil from the European Union and the U.S.
Crude oil increased 68 cents to $82.35 a barrel and natural gas edged higher 10 cents to $3.27 a thermal unit.
U.S. Treasury Yields Hold Firm
The yield on 2-year Treasury notes inched higher to 4.23%, 10-year Treasury notes edged up to 3.52% and 30-year Treasury bonds increased to 3.70%.
U.S. Stock Movers
Apple Inc rose 3.2% to $142.23 and the maker of popular computing devices is looking to diversify its manufacturing base following the rising tensions between China and the U.S.
Apple Inc plans to increase its iPhones production in India to 25% from the current 5% to 7%, commerce and industry minister Piyush Goyal said today.
Spotify Technology SA increased 2.2% to $100.22 after the audio streaming platform said it plans to trim its workforce by 6%.
Baker Hughes Company declined 1.1% to $30.74 after the oil services provider reported higher revenues but profit dropped in the fourth quarter.
Revenue increased 7.7% to $5.91 billion from $5.49 billion last year and net income dropped 38% to $182 million from $394 million and diluted earnings per share declined to 18 cents from 44 cents a year ago.
The oil services provider retained its positive outlook for the energy sector despite tightening monetary conditions and operating challenges under recessionary conditions.
European Markets Extend Gains, Euro at New 9-month High
European markets traded higher supported by rising tech stocks.
Benchmark indexes in the region advanced on the hopes of China's reopening, falling natural gas prices and slower rate hikes in the U.S. but the European policymakers supported aggressive rate hikes at the next meetings in February and March.
The Euro Area consumer sentiment index in January 2023 improved to the high not seen since February 2022
The DAX index increased 0.5% to 15,102.95, the CAC-40 index rose 0.5% to 7,032.02 and the FTSE 100 index closed up 0.2% to 7,784.67.
The euro rose to a new 9-month high of $1.09 on the expectations of 50 basis points rate increases at least at the next meetings in February and March.
The euro inched higher to a new 9-month high of $1.09, the British pound edged lower to $1.233 and the Swiss franc closed down to 92.39 U.S. cents.
The yield on 10-year German Bunds advanced to 2.20%, French bonds traded higher to 2.65%, the UK Gilts to 3.35% and the Italian bonds to 4.01%.
Yen Drifts Lower, Tepco Seeks Higher Rates
Markets in Tokyo closed higher after the yen retreated from 7-1/2 month high reached last week and the Bank of Japan's minutes of meeting showed that the central bank took actions to improve bond market functioning.
The Bank of Japan left its ultraloose monetary policy intact after the two-day meeting ending on December 20 but the meeting was also adjourned for 30 minutes to allow government representatives to discuss with the finance ministry, highlighting the gravity of the decision.
Tokyo Electric Power Company declined 1.5% to ¥445.0 and the power utility company said it applied to the industry ministry to raise the residential utility rate by 30% from June to cover the higher fuel procurement expenses.
Tepco also estimated a financial year ending in March loss of ¥317 billion or $2.4 billion compared to a ¥5.64 billion profit in the previous year, due to higher natural gas import prices and elevated wholesale electricity costs.
The Nikkei 225 index added 1.3% to 26,906.04 and the yen closed at 130.63 against the U.S. dollar.
Infection Spike Worries China Investors
Markets in mainland China, Hong Kong, Singapore and South Korea were closed to celebrate the Lunar New Year.
Chinese markets will resume normal operations on January 30.
In Friday's trading, the Shanghai Composite index jumped 0.8% to 26,906.04 and the Hang Seng index advanced 1.8% to 22,044.65.
Bank Earnings Lift India Indexes
Stocks in Mumbai traded higher after five leading banks, Axis Bank, Canara Bank and ICICI Bank, IDBI and Kotak Mahindra reported higher than expected earnings.
Indian market sentiment was also positive after the U.S. Fed officials' comments supported smaller rate hikes in New York on Friday.
The Sensex index added 0.5% or 319.90 points to 60,941.67 and the Nifty index jumped 0.5% or 90.90 to 18,118.55.
The rupee edged lower to 81.30 against the U.S. dollar.
- Arjun Pandit
- 23 Jan, 2023
- Mumbai
Markets in Tokyo closed higher after the yen retreated from 7-1/2 month high reached last week and the Bank of Japan's minutes of meeting showed that the central bank took actions to improve bond market functioning.
The Bank of Japan left its ultraloose monetary policy intact after the two-day meeting ending on December 20 but the meeting was also adjourned for 30 minutes to allow government representatives to discuss with the finance ministry, highlighting the gravity of the decision.
Tokyo Electric Power Company declined 1.5% to ¥445.0 and the power utility company said it applied to the industry ministry to raise the residential utility rate by 30% from June to cover the higher fuel procurement expenses.
Tepco also estimated a financial year ending in March loss of ¥317 billion or $2.4 billion compared to a ¥5.64 billion profit in the previous year, due to higher natural gas import prices and elevated wholesale electricity costs.
The Nikkei 225 index added 1.3% to 26,906.04 and the yen closed at 130.63 against the U.S. dollar.
Markets in mainland China, Hong Kong, Singapore and South Korea were closed to celebrate the Lunar New Year.
Chinese markets will resume normal operations on January 30.
In Friday's trading, the Shanghai Composite index jumped 0.8% to 26,906.04 and the Hang Seng index advanced 1.8% to 22,044.65.
Stocks in Mumbai traded higher after five leading banks, Axis Bank, Canara Bank and ICICI Bank, IDBI and Kotak Mahindra reported higher than expected earnings.
Indian market sentiment was also positive after the U.S. Fed officials' comments supported smaller rate hikes in New York on Friday.
The Sensex index added 0.5% or 319.90 points to 60,941.67 and the Nifty index jumped 0.5% or 90.90 to 18,118.55.
The rupee edged lower to 81.30 against the U.S. dollar.
- Barry Adams
- 20 Jan, 2023
- New York City
Stocks on Wall Street advanced as Fed officials supported smaller rate hikes and investors set aside inflation worries and terminal rates.
Stocks edged higher in volatile fashion after Google parent Alphabet announced a plan to eliminate thousands of jobs and existing homes sales dropped for the eleventh month in a row.
Five leading tech companies, Alphabet, Amazon, Meta, Microsoft and Salesforce.com have announced plans to eliminate about 80,000 jobs worldwide.
Despite the layoffs from leading tech companies, labor market experts highlighted the tight labor market conditions and investors shifted focus to the pick up in earnings season next week.
The constant drumbeat of Fed officials supporting the need to increase rates was in full-force today as policymakers prepare to meet in ten days.
Fed Reserve Governor Christopher Wallace said at a gathering in New York that rates have a long way to go and supported a smaller rate hike of 25 basis points at the next policy meeting scheduled in ten days.
Yesterday at an industry gathering in New York, Federal Reserve Bank of New York President John Williams also supported the case for raising rates and reiterated the central bank's commitment in bringing down inflation to the target rate of 2%.
However, Williams did not express any view about the size of the rate hike and the level of terminal rates, according to two event attendees.
Federal Reserve policy makers are set to hike rates at the end of a two-day meeting on February 1 and investors are factoring an increase of 25 basis points, smaller than the previous 50 basis points increase last month.
Existing Home Sales Dropped Eleven Months In a Row
Existing homes sales in December declined for the eleventh month in a row and dropped to the lowest level not seen since November 2010 to 4.02 million units, 34% lower than a year ago.
S&P 500and Nasdaq Trade Higher
Benchmark indexes traded higher on Friday but are set to close down for the week.
The S&P 500 index increased 1.9% to 3,972.31 and the Nasdaq Composite index added 2.7% to 11,140.44.
For the week, the S&P 500 declined 0.7% and the Nasdaq gained 0.6% and registered third weekly advance in a row.
Crude oil increased $1.15 to $81.75 and natural gas futures decreased 14 cents to $3.13 a thermal unit.
The yield on 2-year Treasury notes increased to 4.17%, 10-year Treasury notes inched higher to 3.48% and 30-year Treasury bonds advanced to 3.65%.
U.S. Stock Movers
Google parent Alphabet Inc soared 4.8% to $97.50 after CEO Sundar Pichai said the company is planning to eliminate 12,000 worldwide jobs.
The company will begin layoffs immediately in the U.S and may take longer to trim staff in other countries reflecting local laws and practices.
Netflix Inc increased 7.1% to $337.99 after the streaming services provider reported higher-than-expected increase in new subscribers.
Netflix said fourth quarter revenues increased 1.9% to $7.85 billion but net income plunged to $55 million from $607 million and diluted earnings per share fell to 12 cents from $1.33 a year ago.
Netflix added 7.6 million net new subscribers in the fourth quarter and ended the year 2022 with 230.75 million subscribers.
Nordstrom Inc increased 0.5% to $17.53 after the company posted weak holiday sales citing the "promotional" retail environment forced the retailer to offer larger-than-usual discounts.
Nordstrom said 9-week holiday period sales fell 3.5% from a year ago and lowered its fiscal year earnings per share outlook to between $1.33 and $1.53 from the previous range between $2.13 and $2.43.
Sales at namesake stores declined 1.7% and fell 7.6% at discount Rack stores.
Ocean Freight Prices Plunged
Baltic Exchange's Dry Bulk Index, a measure of worldwide ocean freight cost, plunged 8.8% to a 30-month low to 801 ahead of the Lunar New Year holiday period in China.
European Markets Look Ahead to Earnings
European markets traded higher on Friday but closed down for a week after central bankers pushed for aggressive rate-path to continue.
In Friday's trading, market sentiment was positive and crude prices advanced on the hopes of a rebound in business activities in China and Japan.
Japan's Prime Minister Fumio Kishida announced a plan to loosen border restrictions and end quarantine requirements for international travelers.
European Central Bank President Christine Lagarde said at a gathering of business leaders in Switzerland today that the reopening of China could also spark inflation higher.
The rebound in business activities are likely to increase LNG consumption higher in 2023 from the previous year and there is not enough available spare capacity to meet the new demand.
Higher energy prices are the main drivers of inflation in Europe and the reopening of the second-largest economy could ease supply chain pressures but will drive energy inflation higher.
German Wholesale Inflation Dropped to 15-month Low
Germany's wholesale price inflation declined for the third month in a row and dropped to the lowest level in just over a year after energy price inflation receded, the Federal Statistics Office said Friday.
Wholesale price inflation in Germany slowed to 21.6% in December from 28.2% in November and fell to the lowest level in fifteen months, the Federal Statistical Office said Friday.
UK Retail Sales Declined In December
Retail sales in the UK unexpectedly declined in December despite the Christmas holiday period.
December sales fell 1.0% after falling revised 0.5% in November, the Office for National Statistics said Friday.
Europe Indexes Recoup Losses
The DAX index increased 0.8% to 15,033.56, the CAC-40 index added 0.6% to 6,995.99 and the FTSE !00 index closed up 0.3% to 7,770.59.
For the week, the DAX and the CAC-40 indexes declined 0.4% and the FTSE 100 index fell 1%.
Euro Closed at 9-month High
The euro continued to advance and rebounded to a nine-month high after the easing of the U.S. inflation worries and hopes of smaller rate hikes by the Federal Reserve.
The euro inched higher to $1.084, the British pound edged up to $1.238 and the Swiss franc increased to 92.18 U.S. cents.
Energy Markets Close Higher In Europe
Natural gas prices traded near a 16-month low of €50 amid warmer climate conditions in the region and above 80% storage capacity in major markets in France, Germany, Spain and Italy.
In addition, LNG supplies for China are redirected to Europe after Chinese storage capacities are at near-full levels.
Brent crude oil advanced $1.25 to $87.37 a barrel and the Dutch TTF natural gas futures rose 11.3% to $67.55 per MWh.
Europe Stock Movers
Telefonaktiebolaget LM Ericsson dropped 4.70% to Skr 59.0 in Stockholm trading after the Swedish telecom equipment maker said fourth quarter profit fell on large one-time charges.
Sales in the fourth quarter increased 21% to Skr 86 billion and net income fell 39% to Skr 6.0 billion from Skr 10.1 billion.
The quarterly earnings were down after the company booked a one-time of Skr 4.0 billion charge related to IoT divestment and cloud software and services contract and portfolio exits and reserve of Skr 2.3 billion for a potential U.S. Department of Justice corruption investigation settlement.
4imprint Group plc increased 4.5% to 4,677.50 pence after the UK-based but the US-focused corporate gift seller reported higher-than-expected fiscal year profit.
The company said 2022 revenues increased 45% to $1.14 billion from $787 million and ended the year with a cash balance of $86.7 million compared to $41.6 million a year ago.
Standard Chartered Plc increased 0.5% to 699.01 pence after the UK-bank won an approval to set up a securities brokerage unit in China.
Japan to End Coronavirus Restrictions In Spring
Asian markets advanced after rate hike worries in the U.S. eased and China left its key lending rates unrevised.
The Nikkei 225 index inched up 0.6% to 26,553.53 and the yen eased to 129.50 against the U.S. dollar.
Japan's inflation in December surged to 4.0% from a year ago to the highest level since 1991 on the yen weakness and a surge in international commodities prices.
Airline and travel stocks were in demand after Prime Minister Fumio Kishida announced a plan to downgrade Covid-19 disease to a seasonal influenza in the spring.
The major policy change since nearly three years of pandemic, Japan will end mask requirements, review border controls and end quarantine requirements.
The shift in policy comes after three years of strict social mobility restrictions as the nation prepares to live with the virus despite hundreds of deaths daily linked to coronavirus infections.
Japan's international arrivals surged 15-fold to 3.1 million in 2022 from the previous year, but the number of arrivals are significantly down from the pre-pandemic level of 32 million in 2019.
PBoC Lowered Rates, China Official Says Infections are Stable
Stocks in China gained after vice premier Sun Chunlan, the leader for the implementation of Covid-19 policy for the last three years, said new infections are at "low level."
Chunlan sought to reassure residents ahead of the Lunar New Year but infections are expected to surge after the holiday period.
Stocks also advanced after the People's Bank of China left its key lending rates unchanged for the fifth month in a row.
One-year Loan Prime Rate was left at 3.65% and five-year rate used for the mortgage market was held at 4.3%.
The Shanghai Composite index advanced 0.8% to 3,264.81 and the Hang Seng index jumped 1.8% to 22,044.65.
Hong Kong stocks advanced after the city's jobless rate declined for the eighth month in a row.
India Stocks Edged Lower
Stocks in Mumbai traded down for the second day in a row after investors reacted to local corporate earnings news.
Global weakness also contributed to market weakness after Microsoft announced a plan to lay off 10,000 employees and Google's parent Alphabet said it plans to eliminate 18,000 jobs.
The Sensex index decreased 0.4% or 236.66 points to 60,621.77 and the Nifty index declined 0.4% or 80.20 points to 60,621.77.
The Indian rupee traded higher to 80.98 against the U.S. dollar and the yield on 10-year Indian government bonds closed higher at 7.34%.
- Bridgette Randall
- 20 Jan, 2023
- Frankfurt
European markets traded higher on Friday but closed down for a week after central bankers pushed for aggressive rate-path to continue.
In Friday's trading, market sentiment was positive and crude prices advanced on the hopes of a rebound in business activities in China and Japan.
Japan's Prime Minister Fumio Kishida announced a plan to loosen border restrictions and end quarantine requirements for international travelers.
European Central Bank President Christine Lagarde said at a gathering of business leaders in Switzerland today that the reopening of China could also spark inflation higher.
The rebound in business activities are likely to increase LNG consumption higher in 2023 from the previous year and there is not enough available spare capacity to meet the new demand.
Higher energy prices are the main drivers of inflation in Europe and the reopening of the second-largest economy could ease supply chain pressures but will drive energy inflation higher.
German Wholesale Inflation Dropped to 15-month Low
Germany's wholesale price inflation declined for the third month in a row and dropped to the lowest level in just over a year after energy price inflation receded, the Federal Statistics Office said Friday.
Wholesale price inflation in Germany slowed to 21.6% in December from 28.2% in November and fell to the lowest level in fifteen months, the Federal Statistical Office said Friday.
UK Retail Sales Declined In December
Retail sales in the UK unexpectedly declined in December despite the Christmas holiday period.
December sales fell 1.0% after falling revised 0.5% in November, the Office for National Statistics said Friday.
Europe Indexes Recoup Losses
The DAX index increased 0.8% to 15,033.56, the CAC-40 index added 0.6% to 6,995.99 and the FTSE !00 index closed up 0.3% to 7,770.59.
For the week, the DAX and the CAC-40 indexes declined 0.4% and the FTSE 100 index fell 1%.
Euro Closed at 9-month High
The euro continued to advance and rebounded to a nine-month high after the easing of the U.S. inflation worries and hopes of smaller rate hikes by the Federal Reserve.
The euro inched higher to $1.084, the British pound edged up to $1.238 and the Swiss franc increased to 92.18 U.S. cents.
Energy Markets Close Higher In Europe
Natural gas prices traded near a 16-month low of €50 amid warmer climate conditions in the region and above 80% storage capacity in major markets in France, Germany, Spain and Italy.
In addition, LNG supplies for China are redirected to Europe after Chinese storage capacities are at near-full levels.
Brent crude oil advanced $1.25 to $87.37 a barrel and the Dutch TTF natural gas futures rose 11.3% to $67.55 per MWh.
Europe Stock Movers
Telefonaktiebolaget LM Ericsson dropped 4.70% to Skr 59.0 in Stockholm trading after the Swedish telecom equipment maker said fourth quarter profit fell on large one-time charges.
Sales in the fourth quarter increased 21% to Skr 86 billion and net income fell 39% to Skr 6.0 billion from Skr 10.1 billion.
The quarterly earnings were down after the company booked a one-time of Skr 4.0 billion charge related to IoT divestment and cloud software and services contract and portfolio exits and reserve of Skr 2.3 billion for a potential U.S. Department of Justice corruption investigation settlement.
4imprint Group plc increased 4.5% to 4,677.50 pence after the UK-based but the US-focused corporate gift seller reported higher-than-expected fiscal year profit.
The company said 2022 revenues increased 45% to $1.14 billion from $787 million and ended the year with a cash balance of $86.7 million compared to $41.6 million a year ago.
Standard Chartered Plc increased 0.5% to 699.01 pence after the UK-bank won an approval to set up a securities brokerage unit in China.
- Barry Adams
- 20 Jan, 2023
- New York City
Stocks on Wall Street advanced as Fed officials supported smaller rate hikes.
Stocks edged higher in volatile fashion after Google parent Alphabet announced a plan to eliminate thousands of jobs and existing homes sales dropped for the eleventh month in a row.
Fed Reserve Governor Christopher Wallace said at a gathering in New York that rates have a long way to go and supported a smaller rate hike of 25 basis points at the next policy meeting scheduled in ten days.
Yesterday at an industry gathering in New York, Federal Reserve Bank of New York President John Williams also supported the case for raising rates and reiterated the central bank's commitment in bringing down inflation to the target rate of 2%.
However, Williams did not express any view about the size of the rate hike and the level of terminal rates, according to two event attendees.
Federal Reserve policy makers are set to hike rates at the end of a two-day meeting on February 1 and investors are factoring an increase of 25 basis points, smaller than the previous 50 basis points increase last month.
Existing Home Sales Dropped Eleven Months In a Row
Existing homes sales in December declined for the eleventh month in a row and dropped to the lowest level not seen since November 2010 to 4.02 million units, 34% lower than a year ago.
S&P 500and Nasdaq Trade Higher
Benchmark indexes traded higher on Friday but are set to close down for the week.
The S&P 500 index increased 0.9% to 3,931.95 and the Nasdaq Composite index added 1.5% to 11,012.27.
Crude oil was unchanged at $80.59 and natural gas futures increased 3 cents to $3.30 a thermal unit.
The yield on 2-year Treasury notes increased to 4.19%, 10-year Treasury notes inched higher to 3.49% and 30-year Treasury bonds advanced to 3.66%.
U.S. Stock Movers
Google parent Alphabet Inc soared 4.8% to $97.50 after CEO Sundar Pichai said the company is planning to eliminate 12,000 worldwide jobs.
The company will begin layoffs immediately in the U.S and may take longer to trim staff in other countries reflecting local laws and practices.
Netflix Inc increased 7.1% to $337.99 after the streaming services provider reported higher-than-expected increase in new subscribers.
Netflix said fourth quarter revenues increased 1.9% to $7.85 billion but net income plunged to $55 million from $607 million and diluted earnings per share fell to 12 cents from $1.33 a year ago.
Netflix added 7.6 million net new subscribers in the fourth quarter and ended the year 2022 with 230.75 million subscribers.
Nordstrom Inc increased 0.5% to $17.53 after the company posted weak holiday sales citing the "promotional" retail environment forced the retailer to offer larger-than-usual discounts.
Nordstrom said 9-week holiday period sales fell 3.5% from a year ago and lowered its fiscal year earnings per share outlook to between $1.33 and $1.53 from the previous range between $2.13 and $2.43.
Sales at namesake stores declined 1.7% and fell 7.6% at discount Rack stores.
Ocean Freight Prices Plunged
Baltic Exchange's Dry Bulk Index, a measure of worldwide ocean freight cost, plunged 8.8% to a 30-month low to 801 ahead of the Lunar New Year holiday period in China.
European Markets
Germany's wholesale price inflation declined for the third month in a row and dropped to the lowest level in just over a year after energy price inflation receded, the Federal Statistics Office said Friday.
Wholesale price inflation in Germany slowed to 21.6% in December from 28.2% in November and fell to the lowest level in thirteen months, the Federal Statistical Office said Friday.
Retail sales in the UK unexpectedly declined in December despite the Christmas holiday period.
December sales fell 1.0% after falling revised 0.5% in November, the Office for National Statistics said Friday.
The DAX index increased 0.8% to 15,033.56, the CAC-40 index added 0.6% to 6,995.99 and the FTSE !00 index closed up 0.3% to 7,770.59.
The euro inched higher to $1.084, the British pound edged up to $1.238 and the Swiss franc increased to 92.18 U.S. cents.
Brent crude oil advanced $1.25 to $87.37 a barrel and the Dutch TTF natural gas futures rose 11.3% to $67.55 per MWh.
Asian Markets
Asian markets advanced after rate hike worries in the U.S. eased and China left its key lending rates unrevised.
The Nikkei 225 index inched up 0.6% to 26,553.53 and the yen eased to 129.50 against the U.S. dollar.
Japan's inflation in December surged to 4.0% from a year ago to the highest level since 1991 on the yen weakness and a surge in international commodities prices.
Airline and travel stocks were in demand after Prime Minister Fumio Kishida announced a plan to downgrade Covid-19 disease to a seasonal influenza in the spring.
The major policy change since nearly three years of pandemic, Japan will end mask requirements, review border controls and end quarantine requirements.
The shift in policy comes after three years of strict social mobility restrictions as the nation prepares to live with the virus despite hundreds of deaths daily linked to coronavirus infections.
Japan's international arrivals surged 15-fold to 3.1 million in 2022 from the previous year, but the number of arrivals are significantly down from the pre-pandemic level of 32 million in 2019.
Stocks in China gained after vice premier Sun Chunlan, the leader for the implementation of Covid-19 policy for the last three years, said new infections are at "low level."
Chunlan sought to reassure residents ahead of the Lunar New Year but infections are expected to surge after the holiday period.
Stocks also advanced after the People's Bank of China left its key lending rates unchanged for the fifth month in a row.
One-year Loan Prime Rate was left at 3.65% and five-year rate used for the mortgage market was held at 4.3%.
The Shanghai Composite index advanced 0.8% to 3,264.81 and the Hang Seng index jumped 1.8% to 22,044.65.
Hong Kong stocks advanced after the city's jobless rate declined for the eighth month in a row.
Stocks in Mumbai traded down for the second day in a row after investors reacted to local corporate earnings news.
Global weakness also contributed to market weakness after Microsoft announced a plan to lay off 10,000 employees and Google's parent Alphabet said it plans to eliminate 18,000 jobs.
The Sensex index decreased 0.4% or 236.66 points to 60,621.77 and the Nifty index declined 0.4% or 80.20 points to 60,621.77.
The Indian rupee traded higher to 80.98 against the U.S. dollar and the yield on 10-year Indian government bonds closed higher at 7.34%.
- Arjun Pandit
- 20 Jan, 2023
- Mumbai
Asian markets advanced after rate hike worries in the U.S. eased and China left its key lending rates unrevised.
The Nikkei 225 index inched up 0.6% to 26,553.53 and the yen eased to 129.50 against the U.S. dollar.
Japan's inflation in December surged to 4.0% from a year ago to the highest level since 1991 on the yen weakness and a surge in international commodities prices.
Airline and travel stocks were in demand after Prime Minister Fumio Kishida announced a plan to downgrade Covid-19 disease to a seasonal influenza in the spring.
The major policy change since nearly three years of pandemic, Japan will end mask requirements, review border controls and end quarantine requirements.
The shift in policy comes after three years of strict social mobility restrictions as the nation prepares to live with the virus despite hundreds of deaths daily linked to coronavirus infections.
“We will step up moves toward living with the coronavirus to restore normalcy to Japan,” Prime Minister Kishida announced today.
Japan's international arrivals surged 15-fold to 3.1 million in 2022 from the previous year, but the number of arrivals are significantly down from the pre-pandemic level of 32 million in 2019.
Stocks in China gained after vice premier Sun Chunlan, the leader for the implementation of Covid-19 policy for the last three years, said new infections are at "low level."
Chunlan sought to reassure residents ahead of the Lunar New Year but infections are expected to surge after the holiday period.
Stocks also advanced after the People's Bank of China left its key lending rates unchanged for the fifth month in a row.
One-year Loan Prime Rate was left at 3.65% and five-year rate used for the mortgage market was held at 4.3%.
The Shanghai Composite index advanced 0.8% to 3,264.81 and the Hang Seng index jumped 1.8% to 22,044.65.
Hong Kong stocks advanced after the city's jobless rate declined for the eighth month in a row.
Stocks in Mumbai traded down for the second day in a row after investors reacted to local corporate earnings news.
Global weakness also contributed to market weakness after Microsoft announced a plan to lay off 10,000 employees and Google's parent Alphabet said it plans to eliminate 18,000 jobs.
The Sensex index decreased 0.4% or 236.66 points to 60,621.77 and the Nifty index declined 0.4% or 80.20 points to 60,621.77.
The Indian rupee traded higher to 80.98 against the U.S. dollar and the yield on 10-year Indian government bonds closed higher at 7.34%.