Dow and Nasdak shake when oil plummets

After attempting further rebounds at the start of Friday’s session, the US rating failed again. The Dow Jones went into the red frankly after sinking the 30,000-point psychological bar yesterday, down 0.77% to 29,695 points. The S & P 500, currently in the “bear” territory, fell 0.66% to 3,644 points. Meanwhile, Nasdaq floats and scores between 0.14% and 10,659 points. The US index was loose enough yesterday evening, with the Dow giving up 2.4% and the Nasdaq 4.1%. Operators remain very nervous in the face of record inflation, and in the face of further monetary tightening prospects, while the economy is already showing signs of significant weakness. But at Nymex, the barrel of WTI crude has fallen by 5.2% and is now at $ 111. One ounce of gold goes from 0.4% to $ 1,842. The dollar index soared 1.3% against a basket of currencies. Bitcoin has been around $ 20,000 since the recent price drop.

This Friday is the Day of the Four Witches on Wall Street. This can lead to increased (but less) volatility in the market. Held four times a year (the third Friday of June, March, September and December), this stock market event marks the simultaneous expiration of four types of contracts: index and stock options, and index and futures. Correspond. stock.

According to the Fed on Friday, US industrial production in May 2022 increased by only 0.2% compared to the previous month, while market consensus was 0.4% and the revised reading from the previous month was 1.4%. Manufacturing production was down 0.1% compared to April, compared to a consensus of + 0.4%. Finally, capacity utilization was 79%, but consensus was 79.2% and last month was 78.9%.

The Conference Board’s May 2022 key index, as expected, has fallen 0.4% compared to the previous month in line with consensus after a comparable decline in April.

Finally, the Fed’s head, Jerome Powell, intervenes in Washington, but the US central bank has just raised interest rates on the Federal Reserve by 75 basis points, 1.5-1.75%. In 1994, of course, to fight galloping inflation. Markets fear that this accelerated monetary tightening by the Fed will cause a recession.

Powell’s speech today for an introductory remark to the conference on the international role of the dollar did not provide new guidance on monetary policy. The Federal Reserve has confirmed the bank’s commitment to return inflation to a 2% target and ensure financial stability to encourage the international community to hold and use the dollar.

Neel Kashkari, the federal government of Minneapolis, said a 75 basis point rate hike is likely to occur in July. The Federal Reserve Bank and the ECB will have sufficient credibility to curb inflation without causing the severe recession that occurred 40 years ago. “The Fed and ECB are fairly reliable, suggesting that a soft landing is possible,” said Bullard, who may not have read the latest US statistics correctly.

value

Adobe (-4%) announced Thursday evening performance and sales above market expectations for the second quarter, but made cautious forecasts, citing “uncertainty” situations and due to the war in Ukraine. I was disappointed to quote the negative currency effects and fallouts. The second-quarter group, which ended June 3, was known for its InDesign, Photoshop, and Acrobat products and generated a net profit of $ 1.18 billion, up 6% over the year. Adjusted net income per share was $ 3.35, but FactSet consensus analysts expected it to be $ 3.31. Quarterly sales reached $ 4.39 billion, an increase of 14% year-on-year, slightly higher than expected, at $ 4.34 billion.

Meanwhile, management lowered its annual forecast to $ 13.50 per share, with revenue of $ 17.65 billion, while analysts expected $ 13.66 and $ 17.85 billion, respectively. In December, Adobe forecasts EPS of $ 13.70 and revenue of $ 17.90 billion for the fiscal year ending at the end of November. Thus, Adobe has joined a cohort of technology companies such as Microsoft and Salesforce, reporting that the stronger dollar has had a negative impact on earnings and has led to a downward revision to its annual forecast. Supported by a rate hike from the Federal Reserve Board to curb inflation, the dollar recently hit a 20-year high against a basket of currencies such as the euro, yen and pound sterling.

A stronger dollar, on the one hand, makes US exports less competitive, and on the other hand, earns in other currencies and reduces the dollar-converted income in multinational accounts.

Twitter (-1%). Elon Musk, who is currently planning to acquire Twitter, has spoken to platform staff for the first time since offering $ 44 billion two months ago. At a virtual town hall meeting, Mask hinted that Twitter should be downsized and said it needed to be rationalized. He was also asked about the moderation of the site and its political trends. He described himself as moderately open to free speech, and social networks had to tolerate extremes “within the law,” according to him. Billionaires want the network to reach at least 1 billion users, compared to the current 229 million. He also went back a bit to his previous comments on this subject and showed that promotion would continue to be important in the group’s model. He would say something like “I’m not against advertising. You probably talk to advertisers and say,” Hey, make sure your ads are as interesting as possible. ” “

Musk did not reveal details about the final decision on the deal, nor about the possibility of a price revision expected by Wall Street. In response to a question about potential layoffs, he stated that he would need to “for staffing and rationalization of spending.” Employees also wanted to know more about Mask’s vision of remote work. So far, there is a lot of freedom in remote work, and billions of billionaires have already expressed hostility to this subject on Tesla and believe it impossible to design a good product. By teleworking and calling on employees to return home or at the risk of being considered resignation.

Mr. Musk said Twitter staff should move towards working in the office, but expressed his willingness to make some exceptions. Bias should “strongly support face-to-face work, but remote work may be tolerated if someone is exceptional.”

Snap (-1%), the parent company of Snapchat’s free time application for video and photo sharing, will test the paid subscription feature, The Verge shows. A spokeswoman, Liz Markman, told The Verge that the company is conducting “initial internal testing” of Snapchat Plus. This gives users early access to features and other benefits. Keep in mind that Snap has continued to unscrew on Wall Street, especially since the quarterly mix results were announced at the end of May, with warnings about earnings and profits for the second quarter ending at the end of June.

Alibaba (+ 1%) is making progress on Wall Street, but according to Bloomberg, the People’s Bank of China has accepted Ant Group’s request for a potential IPO. Reuters has also reported the rumor, and China’s central bank has accepted Ant’s request for permission to set up a financial holding company to resume plans to introduce FinTech giants, which had been delayed for a long time by authorities. Regulatory barriers. Ant Group is a subsidiary of e-commerce giant Alibaba.

China’s e-commerce group JD.com surged 4% on Wall Street. JD.com will certainly explore the possible expansion of food delivery. These plans were confirmed by JD Retail’s general manager Xin Lijun in an interview with Bloomberg. This will allow China’s e-commerce giants to compete directly with Alibaba and Meituan, which dominate the business in China.

US Steel (Stable), a US steel group, is resisting strong forecasts for the second quarter. Therefore, yesterday evening, the group announced that it expects adjusted net income in the range of $ 3.83 to $ 3.88. David B. Burritt, President and Chief Executive Officer of US Steel, said: “Our broad end-market exposure allows us to remain resilient and is in demand from a diverse customer base, including the resurrected energy market.”

Centene (stable). Health insurers have raised their financial forecasts in terms of profits and added $ 3 billion to their share buyback program. The group also plans to reduce its real estate footprint. Therefore, these wonderful intentions to create value are welcomed. The group is currently expecting adjusted earnings per share in the range of $ 5.55 to $ 5.7 in 2022. A $ 1 billion debt repurchase plan has also been announced. Premium and service revenues for 2022 are currently expected to be between $ 134.3 billion and $ 136.3 billion.

Seagen rose 16%, but according to the Wall Street Journal, American pharmaceutical giant Merck (stable) would have been studying the acquisition of a biotechnology company. The WSJ cites sources familiar with this issue. Negotiations have been going on for some time, according to the newspaper, but there are no imminent deals. Seagen currently weighs nearly $ 30 billion on Wall Street and Merck & Co weighs $ 215 billion. The WSJ has also shown that other suitors also evaluate Seagen files.