Daily markets: profits are concentrated

Overview of the day

Asia-Pacific stock markets were mostly mixed today, with Japan’s Nikkei falling 2.0%, China’s Shanghai Composite and Shenzhen Component down 0.1%, while the Australian ASX 200 fell 0.7%. South Korea’s Kospi added 0.7% and Hong Kong’s Hang Seng rose 0.1%. As of noon, major European stock indices were all in the red and futures in the US market point to a second day of losses. Once again, corporate earnings will be the focus of trade today as the vector and speed of these reports improves in a light economic data schedule.

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International economy

At its April meeting, the Royal Bank of Australia left its cash rate unchanged at a record 0.1% and policymakers affirmed their commitment to maintain very favorable monetary conditions until at least 2024. , when inflation is durably within the target of 2-3%. There are many “very favorable” policies around the world.

Also today, the People’s Bank of China left both its 1-year prime rate and 5-year rate set at 3.85% and 4.65% respectively.

Germany’s PPI came stronger than the 3.3% expected yoy in March to 3.7% yoy, from 1.9% in February. On a MoM basis, the PPI was also stronger than the expected decline to 0.6% in March from 0.7% in February, dropping to 0.9% – more of those base effects that we expect to see in months ahead as we compare opening activity to declining demand levels from last year as pandemic lockdowns were just beginning.

The UK unemployment rate unexpectedly fell to 4.9% in February, from 5% in January, from which it is expected to drop to 5.1%. Average earnings including bonuses in February increased less than expected to 4.5% in the three months ending February 2021, which was the smallest increase in three months and after the increase of 4.8 % of three months ended January 2021, a pace at which it was expected to stay. In response, the pound sterling rose by around $ 1.40 for the first time in a month.

Domestical economy

Later today in the United States, we will receive the regular weekly retail sales report from the Redbook as well as the weekly API Crude Oil Inventory report.

The steps

The market started this week with a slight pullback. The S&P 500 fell 0.5% yesterday, the Nasdaq fell 1.0%, the Dow 0.4% and the Russell 2000 fell 1.4%. The US dollar fell 0.4% and Treasuries were mixed with higher longer yields as shorter maturities fell. The Bitcoin-hit weekend continued yesterday, with the cryptocurrency sitting just above its 50-day moving average, down more than 10% from recent highs, but still up more than 90% since the beginning of the year. Actions related to the cryptography of Coinbase (COIN), Marathon Digital Holdings (MARA), and Riot Blockchain (RIOT) were down on the day, down 2.6%, 8.7% and 8.4% respectively.

Actions to watch

Investors will consult the quarterly results and analyze the forward-looking comments of Abbot Labs (ABT), AutoNation (AN), Johnson & Johnson (JNJ), Lockheed Martin (LMT), Philip Morris International (afternoon), and Proctor & Gamble (PG) among other things before the US stock markets started trading today.

Yesterday afternoon BMW (BMWYY) delivered fairly strong preliminary first quarter results, with automotive EBIT margins of 9.8%, the highest EBIT since 2017. The company recorded sales growth in all major regions and all of the cars owned by the rental.

Actions of Interactive Platoon (PTON) closed down 7.3% yesterday as the company battles a regulatory warning regarding the safety of its Tread + treadmill after a child was killed in an accident involving one. The Consumer Product Safety Commission said people should stop using the machine if they have small children or pets in the home and are asking the company to recall the product. On Saturday, Peloton called the warning “inaccurate and misleading”.

MarketWatch reports the United States House, in a 321-101 vote, approved a bill sponsored by Rep. Ed Perlmutter, a Colorado Democrat, that would prohibit banking system regulators from penalizing banks or credit unions who do business with a “legitimate cannabis company,” Their service providers or state or local governments having jurisdiction over the companies. How appropriate for today’s date: 4-20.

PayPal (PYPL) announced the launch of crypto on Venmo, a new way for Venmo’s more than 70 million customers to buy, hold and sell cryptocurrency directly in the Venmo app.

IBM (IBM) posted first quarter revenue that grew 1% (before adjustment for currency fluctuations) beating expectations of 2.4%, with all segments showing beats except for the finance division . Operating EPS was up 7.3% and pro forma profit was $ 1.77 per share, down $ 0.07 from a year ago, but $ 0.14 as of above consensus estimates. The company reiterated its expectations for higher revenues and adjusted cash flow between $ 11 billion and $ 12 billion for the year.

United Airlines (UAL) reported operating income slightly above the $ 3.2 billion originally reported for the first quarter, but the loss of $ 7.50 per share was worse than expected. Passenger revenue per available seat-mile was 4.7% lower than forecast and available seat-miles were 2.3% lower than estimated with a load factor below the 58.9% expected at just 56.8 %. Management cited “strong evidence of pent-up demand for air travel.” (Yes please!)

Volvo AB (VOLVF), the world’s second-largest truck maker, hopes that half of its sales in Europe will be electric by 2030. Today, the company announced three new heavy-duty electric trucks designed for regional intercity transport and city construction. Production of the trucks is expected to start in the second half of 2022.

Axos Financial (AX) announced that its wholly-owned subsidiary Axos Clearing has signed a definitive agreement to acquire certain assets and liabilities of E * TRADE Advisor Services, the custody company of registered investment advisers Morgan Stanley (MS) acquired as part of its acquisition of E * TRADE Financial Corporation in 2020.

J2 Global (JCOM) announced its intention to separate into two independent publicly traded companies – J2 Global and Consensus, by selling at least 80.1% of the outstanding common shares of Consensus to shareholders of J2.

InterDigital (IDCC) subsidiaries renewed their multi-year, worldwide, non-exclusive, royalty-free patent license agreement with Sharp Corporation (SHCAY).

Oprah Winfrey-backed oat milk maker Oatly Group AB has applied for a scholarship in the United States and intends to raise at least $ 100 million.

Genworth Mortgage Holdings, a wholly owned subsidiary of Genworth Financial (GNW) also filed for its IPO.

After today’s market closes, CSX (CSX), Intuitive surgery (ISRG), and Netflix (NFLX) will be among the companies that publish their quarterly results. Investors wishing to prepare for these reports and others should visit Nasdaq earnings calendar page.

On the horizon

  • April 21: EIA Energy Stocks
  • April 22: Jobless Claims, Chicago Fed National Activity Index, Existing Home Sales
  • April 23: PMI Markit Manufacturing and Services, New Home Sales
  • April 26: Durable goods orders, Dallas Fed Manufacturing
  • April 27: S & P / Case-Shiller House Price Index, Conference Board Consumer Confidence, API Crude Oil Inventories
  • April 28: Merchandise trade balance, wholesale stocks, EIA energy stocks, Federal Reserve interest rate decision and press conference
  • April 29: Q1 US GDP (anticipated estimate), jobless claims, pending home sales
  • April 30: Personal income and expenditure, PCE price index, cost of employment index, Chicago PMI, Univ. Consumer sentiment in Michigan
  • May 3: Markit Manufacturing PMI, construction spending, ISM manufacturing, total vehicle sales
  • May 4: Trade balance, IBD / TIPP economic optimism, factory orders, API crude stocks
  • May 5: ADP Employment Report, Markit Services PMI, ISM Non-Manufacturing PMI, EIA Energy Stocks
  • May 6: jobless claims, unit labor costs, non-farm productivity
  • May 7: Non-farm payroll, wholesale stocks
  • May 10: Consumer inflation expectations
  • May 11: NFIB Business Optimism Index, JOLT job postings, Redbook weekly retail sales, API crude oil inventory trends
  • May 12: MBA Mortgage Applications, Inflation Rate, EIA Energy Stock Reports, World Agricultural Demand and Supply Estimates (WASDE) Report, Monthly Budget Status
  • May 13: PPI, Weekly Employment Applications, EIA Natural Gas Inventories
  • May 14: Retail sales, import / export price, industrial production, manufacturing production, capacity utilization, business inventories, Michigan Consumer Sentiment Report, Baker Hughes Oil Rig Count

Thought of the day

“If people never did anything stupid, nothing smart would ever be done.” ~ Ludwig Wittgenstein.

Disclosures

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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About Robert Valdivia

Robert Valdivia

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