The S&P 500 Index (US500) was down 0.02 percent and the Dow Jones Index (US30) was up 0.03 percent as of yesterday’s market closing. The NASDAQ Technology Index (US100) fell 0.18% yesterday.
The US reporting season is still gaining traction. Thanks to a 37% rise in sales, Tesla (TSLA) had a fantastic fourth quarter. According to Tesla, they are prepared for short-term unpredictability in any situation, but they are primarily concerned with the long-term possibilities of autonomy, electrification, and energy solutions. IBM Corporation (IBM) exceeded Wall Street projections for the fourth quarter on Wednesday and posted its strongest annual sales increase in a decade. The business also forecasts an increase in sales year over year. However, despite the positive report, the company’s stock price dropped after it was released. Due to the bad macroeconomic environment, economists do not have faith in corporations to produce such outcomes, which is why they say this. After the tech giant lost another 1,800 employees on Wednesday, Alphabet (GOOGL) shares saw an escalation in losses from the previous day, dropping more than 2%.
The Bank of Canada increased its overnight rate by 25 basis points to 4.5%, as expected. The Board of Governors anticipates keeping the discount rate at its current level, assuming economic developments roughly follow MPR’s estimate, according to a statement that was included. Among the big economies, the Bank of Canada may be the first to stop tightening monetary policy.
Europe’s equity markets were generally lower yesterday. Yesterday, the British FTSE 100 (UK100) was down 0.16%, the Spanish IBEX 35 (ES35) dropped 0.16%, the French CAC 40 (FR40) gained 0.09%, and the German DAX (DE30) was down 0.08%.
The largest economy in Europe, Germany, has effectively weathered the energy crisis and assisted consumers and companies hit by rising energy costs, according to the German government, which indicated on Wednesday that it anticipates economic growth this year rather than a recession. When Germany thought it might run short of the natural gas necessary to run factories, produce electricity, and heat homes this winter, the estimate for 2023 was revised upward to 0.2% growth from a 0.4% decline predicted in October.
Due to record shortages and declining production, the UK is now facing greater risks of recession. Businesses are seeing a decline in activity, factories are reducing production at a record rate, and the labour market is also beginning to show signs of problems. Investors are wagering that, in order to bolster the faltering economy, the Bank of England will change direction and lower its benchmark interest rate later this year. However, the central bank is anticipated to raise rates by 0.25 to 0.5% twice more before the rate decrease.
Germany gave its approval yesterday for Ukraine to receive Leopard tanks. The US also signalled that it would send 31 Abrams tanks at the same time. Following this development, the Russian embassy tweeted that Germany’s approval of the shipment of Leopard tanks to Ukraine is exceedingly risky and escalates the conflict. In the upcoming weeks, the violence is anticipated to intensify.
The Chinese vacation week has reduced market volatility in the energy sector. Analysts anticipate more increases in oil quotes given the present level of OPEC output and their continued optimism regarding the spike in Chinese demand. The increase in strategic crude stocks for the fourth consecutive week is the only thing holding back growth.
Yesterday’s trading on Asian markets was likewise flat. Due to holidays, China’s FTSE China A50 (CHA50) did not trade and will not trade until the end of the week, whereas Japan’s Nikkei 225 (JP225) increased by 0.35%. The Hang Seng (HK50) in Hong Kong did not trade either. The NIFTY 50 in India fell by 1.25%, and the S&P/ASX 200 in Australia finished the day down by 0.30%.
S&P 500 (F) (US500) 4,016.22 −0.73 (−0.018%)
Dow Jones (US30) 33,743.84 +9.88 (+0.029%)
DAX (DE40) 15,081.64 −11.47 (−0.076%)
FTSE 100 (UK100) 7,744.87 −12.49 (−0.16%)
USD Index 101.64 −0.28 (−0.27%)