Wall Street appears in the green this Monday, at its peaks while awaiting a new battery of economic indicators including in particular the inflation figures or those of consumption this week. The S&P 500 gained 0.11% to 5,032 pts, the Dow Jones also gained 0.11% to 38,714 pts and the Nasdaq 0.27% to 16,033 pts. On the Nymex, a barrel of WTI crude dropped 0.1% to $76.8. An ounce of gold fell by 0.6% to $2,027. The dollar index advances 0.1% against a basket of currencies.
On the economic front on Wall Street this Monday, the American budget balance for the month of January 2024 will be known at 8 p.m. (consensus -$21 billion). Minneapolis Fed President Neel Kashkari speaks today, as do Governor Michelle Bowman and Richmond Fed President Thomas Barkin. Bowman said risks remained in the fight against inflation and it was therefore too early to consider an immediate rate cut. Thus, in the immediate future, monetary easing would not be appropriate according to her…
The American consumer price index for January 2024 will be revealed tomorrow at 2:30 p.m. (FactSet consensus +0.2% compared to the previous month or +2.9% year-on-year; +0.3% and +3 .7% excluding food and energy).
On Wednesday, operators will follow at 4:30 p.m. the weekly report from the US Department of Energy concerning US domestic oil stocks, for the week ended February 9. Austan Goolsbee, the head of the Chicago Fed, will also provide some comments.
Thursday, the program will be quite busy, with from 2:30 p.m. weekly unemployment registrations for the week ending February 10 (FactSet consensus 220,000), retail sales for the month of January (FactSet consensus -0.1% compared to the previous month , +0.2% excluding automobiles and +0.4% excluding automobiles and gasoline), import and export prices for January (stable consensus for imports), as well as the Empire State manufacturing index of the New York Fed for the month of February (consensus -11) and the Philadelphia Fed’s manufacturing index for the same month (consensus -8.5).
Also on Thursday, investors will follow the figures for American industrial production for the month of January at 3:15 p.m. (consensus +0.3% compared to the previous month, 78.8% capacity utilization rate). Inventories and sales of companies for the month of December, as well as the NAHB index of the American real estate market for February (consensus 46), will also be known on Thursday, at 4 p.m…. Note also that Raphael Bostic, head of the Fed ‘Atlanta, will take place the same day.
Finally, on Friday, operators will be attentive to the figures for construction starts and building permits for January (2:30 p.m., consensus 1.47 million for construction starts and 1.515 million for permits), to the producer price index of January (2:30 p.m., consensus +0.1% compared to the previous month or +0.7% over one year; +0.1% and +1.8% excluding food and energy), as well as the index preliminary US consumer sentiment from the University of Michigan for the month of February (4 p.m., consensus 80).
The quarterly financial release season is coming to an end on Wall Street, but there are still a few notable announcements this week. Arista Networks, Cadence Design Systems, Waste Management and Principal Financial Group publish this Monday, after market. Coca-Cola, Shopify, Zoetis, Marriott, Moody’s, Ecolab, Datadog, Biogen, GlobalFoundries and Restaurant Brands announce before market tomorrow. Airbnb, AIG, Akamai and Welltower, publish after the close.
Barrick Gold, Global Payments, Martin Marietta, Williams Companies, Kraft Heinz and CME Group, reveal their results before market on Wednesday, while Cisco, Equinix, Occidental Petroleum, HubSpot and Arch Capital are expected after market the same day.
Deere, West Pharmaceutical Services, Hyatt Hotels and Southern Company, publish Thursday, before market. Applied Materials, DoorDash, Digital Realty Trust, DraftKings, Ingersoll Rand, The Trade Desk, Coinbase, Consolidated Edison, Roku and Dropbox, reveal their accounts after the close on Thursday.
Values
Amazon (stable) remains monitored on Wall Street this Monday, while its founder Jeff Bezos declared the sale of nearly 12 million shares of the online commerce giant on February 7 and 8, which represents an amount of more than 2 billions of dollars. The share sale was carried out in five blocks of one to 3.2 million shares. In addition, Bezos also declared to the Securities & Exchange Commission, the American financial markets watchdog, his intention to sell 50 million additional Amazon shares with an estimated value of more than $8 billion. The sale plan is subject to certain conditions and was adopted on November 8. It would be completed by the end of January 2025, according to Reuters, which cites Amazon’s latest annual report.
Lockheed Martin (stable). The United States has validated the sale of Lockheed F-16 fighter jets to Turkey. Thus, the American Congress approved Ankara’s acquisition of 40 F-16 aircraft and 79 modernization kits. This sale represents an amount of 23 billion dollars and follows Turkey’s ratification of Sweden’s membership in NATO.
New York Community Bancorp (+6%), an American regional bank that has been heavily attacked in recent weeks, due to doubts about its financial solidity and a rating agency downgrade, gained 17% on Wall Street on Friday and is still in the green this day. Executives of the establishment acquired securities for $870,000, signaling their confidence after a halving of prices since January 31 and the bank’s announcement of a quarterly net loss and a cut in the dividend. A handful of executives at the Hicksville-based bank bought shares Friday. Alessandro DiNello, who was named executive chairman, bought 50,000, chief executive Thomas Cangemi about 11,000, and several other insiders, including board members, also bought.
VF Corp (+12%). Activist investor Engaged has received support from the group’s founding family for brands The North Face, Vans and Timberland. At least that’s what one of the family’s heirs told Reuters. The founding family of VF Corp is now supporting activist Engaged Capital in its campaign for change. A member of the Barbey family, which owns 15% of VF Corp shares, says his family would like to see two of VF’s 12 directors replaced. Sources close to the matter cited by Reuters also say that Engaged has management candidates, who must be named before February 13. The family member claims the board “lacks urgency,” calling current directors “entrenched” and “bureaucratic.”
Diamondback Energy (+9%), a Texas energy group active in oil and natural gas, has sealed an agreement to acquire Texas oil and gas producer Endeavor Energy in a transaction worth of $26 billion including debt which would create the largest pure-player operator in the Permian Basin. The deal is the latest in a series of major agreements in the American oil sector. ExxonMobil previously agreed to buy Pioneer Resources for about $60 billion, while Chevron agreed to buy Hess Group for $53 billion. Occidental Petroleum, for its part, announced the acquisition of CrownRock for nearly $11 billion.
Diamondback would finance the transaction with 117.3 million shares and $8 billion in cash. Diamondback shareholders would hold 60.5% of the new group and Endeavor shareholders 39.5%.
CymaBay Therapeutics jumped 25% to $32 on the Nasdaq this Monday, while Gilead Sciences has just announced a $4.3 billion agreement to acquire the biotechnology firm. Gilead is thus adding a treatment against chronic liver diseases to its portfolio. Gilead will pay $32.50 per CymaBay share in cash, a premium of more than 26% over Friday’s closing prices. Gilead acquires CymaBay’s lead drug candidate, seladelpar, for the treatment of primary biliary cholangitis. CymaBay submitted a marketing application for the drug to the US FDA in December.
