-4.3% of Nasdaq, S & P 500 with less than 4,000 points

Losses increased in the last hour of trading on Wall Street on Monday, with the S & P 500 index falling below 4,000 points for the first time since March 31, 2021 and Nasdaq down 4.3%. Investors succumbed to pessimism about signs of slowing growth in China and the outlook for central bank tightening.

At the closing price, the Dow Jones fell 1.99% to 32,245 points, the broad S & P 500 index fell 3.2% to 3,991 points, and the Nasdaq Composite Index, rich in technology and biotechnology stocks, fell 4.29% to 11,623 points. became. Last week, the S & P 500 and Nasdaq recorded their fifth straight week of decline for the first time in about 10 years. Since the beginning of the year, the three indices have lost 11.2% on DJIA, 16.2% on S & P 500 and 25.7% on Nasdaq, respectively, adding to stagflation and high rate concerns.

Monday’s dollar and bonds acted as a safe haven, but gold fell 1.3%. According to the CoinDesk site, oil fell by about 6% and Bitcoin sank towards $ 30,500 (-12% in 24 hours).

The market was not relieved by the statement of US Treasury Secretary Janet Yellen, who determined that the US financial system was functioning properly, believing that market turmoil could continue. In a hearing text scheduled for the Senate Banking Commission on Tuesday, she said, “As countries continue to face the consequences of a coronavirus pandemic, global growth fluctuations and inequality may continue. There is. “

Russia’s invasion of Ukraine “further increases economic uncertainty,” she continued. “Although the valuation of some assets remains higher than in the past, the US financial system continues to function in an orderly manner.”

China’s foreign trade slows

Investors also responded to reports suggesting an extension of health containment measures in China when China’s foreign trade value clearly showed signs of declining. China’s exports increased by only 3.9% year-on-year, the slowest pace since June 2020, and imports stagnated reflecting the lack of appetite of Chinese consumers facing a coronavirus-related blockade. Did. Omicron wave of Covid-19.

Oil prices plummeted in the news, especially as Saudi Arabia announced in June that it had lowered the selling prices of crude oil it sold to Asia and Europe for more modest demand, as China is the world’s largest oil importer.

Barrels of U.S. WTI light crude (June futures contract) fell 6.1% on Monday night to $ 103.09 on Nymex and North Sea Brent fell 5.7% to $ 105.94 on Monday night. ..

US prices will be the highest since the end of 2018 before falling …

Gold fell 1.3% on Monday to $ 1,858.60 an ounce on the Comex June futures contract. In terms of cryptocurrencies, Bitcoin lost 12% in 24 hours and about $ 30,500 at CoinDesk, a common risk aversion victim.

In the bond market, yields peaked in the morning after November 2018 and then fell again. This is because investors looking for bargains have returned to bonds to benefit from higher interest rates. At the end of the evening, yields on 10-year bonds rose from 10 basis points (1 / 100th point) to 3.03% after rising to 3.20% at the beginning of the day. The two-year T-Bond rate peaked at 2.75% shortly before and then fell 11bp to 2.58%.

In the currency market, the dollar index rose to a 20-year high at 104.19 points against a basket of reference currencies before returning to 103.71 points (+ 0.05%) in the evening. The euro closed the day at $ 1.0560, up 0.09% in the New York interbank market.

Waiting for inflation in April …

Investors continue to focus on future key interest rate hikes from the Central Bank after the bullish moves from the Federal Reserve, the Bank of England and the Central Bank of Australia last week. Faced with high inflation further highlighted by the war in Ukraine, markets expect continued monetary tightening, especially in the United States, where futures markets expect a new tightening of 50 basis points in June. doing. According to CME Group’s FedWatch tool, interest rates will continue to rise by at least another 50bp in July and even September.

Inflation rates for April will be announced Wednesday in the United States, China, Germany and France. Last week, the Fed raised the federal funds rate by 50 bps to 0.75% -1%, began lowering its balance sheet on June 1, and added that it would need to continue its rate hike cycle for the next few months. .. However, its chair, Jerome Powell, felt that the very sharp rise of 75 bp was not a scenario endorsed by the Monetary Policy Committee.

On Monday, Atlanta Fed Chair Raphael Bostic estimated that the Fed could raise interest rates by 50 bps at each of the next few meetings before measuring inflation and its impact on the economy. .. Is required.

In the United States, consensus expects price increases to slow slightly from 8.5% in March to 8.1% in a year. This is the strongest rise since 1981. Increase rate of CPI “core”. Most volatile factors are also expected to slow from 6.5% in March to 6% year-on-year. “The easing of the consumer price index will be mildly comforting, but the acceleration will undoubtedly regain expectations of a 75 basis point rate hike from the Fed,” said an analyst at ANZ Bank.

Value to follow

* BioNTech increased by 3%, supported by quarterly accounts that exceeded analysts’ expectations. US-listed German biotechnology companies more than tripled their net income to 3.7 billion euros per share, compared to 1.13 MdE a year ago and 4.39 per title. It was euro. Its revenue has tripled to € 6.38 billion, largely due to the demand for vaccines against Covid-19 developed by Pfizer. Data that far exceeds analysts’ expectations.

Nonetheless, the company reaffirmed its forecast for a decline in vaccine sales for the full year. Therefore, we expect revenue from vaccines of 13 to 17 billion euros in 2022, compared to 19 billion euros last year. The German company said on Monday that it expects to obtain test data on vaccines to treat the dominant Omicron variant in the coming weeks.

* Southwest Gas Holdings (+ 3.1%) Karl Icahn on Friday after a few months of fighting that ended with a change of group CEO and the granting of four board seats to billionaire investors. And reached an agreement.

* Palantir plunged 21.3% and was overwhelmed by unfortunate publications. Software companies released quarterly financial statements that were lower than analysts expected, and earnings guidance for the quarter was below consensus. Therefore, the Denver-based company forecasts an adjusted operating margin of 20% over the three months to June, compared to 31% in the previous year, with revenue of $ 470 million. , The annual growth rate is only 25% compared to + 49%. 1 year ago. Palantir’s first-quarter sales were $ 446.4 million, compared to $ 341.2 million in the previous year and a consensus of $ 443.4 million. This is due to the strong business operations in the United States. With the exception of items, EPS was 2 cents per share, compared to the market expectation of 5 cents. Operating cash flow reached $ 35 million, equivalent to an 8% margin.

* Rivian fell by more than 20.8%. Ford, the fourth-largest shareholder of electric car makers, reportedly sold 8 million units after the post-IPO lockup period ended on Sunday. US automakers own about 12% of the companies founded in 2019, or just under 102 million shares after acquiring shares ahead of Rivian’s IPO last year, according to CNBC sources. was doing. Rivian, whose market capitalization temporarily exceeded $ 100 billion last year, weighs more than $ 25 billion on Wall Street. Michigan-based groups are struggling to increase production due to supply chain pressure.

* Uber Technologies (-11.6%) quotes a letter from the Group’s CEO to employees, saying CNBC will reduce employment and spending on marketing and subsidies. Dara Khosrowshahi states that Uber’s strategic changes are a necessary response to investor sentimental “earthquake changes.” “The least effective marketing and incentive spending is reduced. We treat recruitment as a privilege and carefully decide when and where to add staff. Manager. According to the report, the company is not adjusted Ebitda, but We will focus on profitability based on free cash flow. The Uber boss also states in this letter that Uber’s food delivery and freight forwarding activities must develop more rapidly.

* Twitter decreased by 3.6%. Elon Musk is thinking big. Billionaire, which recently agreed to buy Bluebird for $ 44 billion, reported Friday that it wants to quintuple its annual social network revenue to $ 26.4 billion by 2028. According to the investor presentation mentioned by the NYT, advertising should account for about $ 12 billion by this period, compared to 45% of the group’s total revenue, or about 90% in 2020, but subscriptions. It should bring another $ 10 billion.

Cash flow should rise to $ 3.2 billion in 2025 and $ 9.4 billion in 2028. E.Musk plans to increase average revenue per user from $ 24.83 in 2021 to $ 30.22 in 2028. More than 11,000 employees by 2025, compared to the current approximately 7,500. Billionaire has promised to “revitalize” the company, increase user numbers, tackle spambots, and reduce the amount of moderation to promote free speech.

In addition, Friday night, Elon Musk and Twitter were found to be the subject of complaints filed by the Florida Pension Fund. In this lawsuit filed in a Delaware court, the Orlando City Police Pension Fund, under Delaware regulations, Elon Musk is a shareholder representing two-thirds of Twitter’s stock, and Tesla approves the operation. To do. Elon Musk is an “interested shareholder” after acquiring more than 9% of Twitter’s stake, which the complaint said would require a delay.

* Apple (-3.3%) and Tesla (-9%) have raised funds following Taiwan’s subcontractor Quanta Services (-6.5%). Their business in China has been affected by the resurgence of the COVID-19 epidemic.

* Lockheed Martin (-2.4%) is the group’s chief executive officer, with plans to nearly double the production of the Javelin missile, an anti-tank weapon that the Ukrainian army has been using since its invasion of Russia. One James Tycklet said on Sunday.