Wall Street experienced a turbulent first session of the year on Tuesday. The S&P 500 lost 0.57% to 4,742 pts, while the Dow Jones gained 0.07% to 37,715 pts. Above all, it was the Nasdaq which fell by 1.63% to 14,765 pts, weighed down by Apple, the victim of an analyst downgrade. On the Nymex, a barrel of WTI crude costs $70. On the bond markets, the yield on the 2-year T-Bond is 4.33%, compared to 3.94% on the 10-year bond and 4.09% on the 30-year bond.
In terms of indicators, the final American manufacturing PMI index for December 2023 stood at 47.9, in a contraction zone below the 50 mark, compared to a FactSet consensus of 48.2 and a level of 48. ,2 also in preliminary reading.
Construction spending in the United States for the month of November 2023 increased by 0.4% compared to the previous month, compared to +0.5% of FactSet consensus and +1.2% for the revised reading of the month prior. The previous reading for October was +0.6%. Year-on-year, November construction spending climbed 11.3%.
Elsewhere in the world, the Markit/Caixin Chinese manufacturing PMI for December stood at 50.8 versus the consensus 49.9.
In Europe, the final Spanish manufacturing PMI index stood at 46.2 in December, compared to 45.3 for the Italian index, 42.1 for France and 43.3 for Germany. These indices reflect a significant contraction in manufacturing activity. The final Eurozone manufacturing index for December stood at 44.4, compared to 44.2 consensus and 44.2 also for the flash reading. The British CIPS manufacturing index came in at 46.2, compared to the consensus of 46.4.
Black gold prices ultimately reacted little to the latest developments in the conflict in the Middle East. Lebanese Hezbollah has in fact warned that the assassination near Beirut of the number two of the political bureau of Palestinian Hamas, Saleh al-Arouri, was a “serious attack against Lebanon” and a “dangerous development” of the new conflict which broke out there. almost three months ago in the region.
Via Telegram messaging, the Lebanese Shiite movement, aligned with Iran and which supports Hamas, promised that the attack carried out on the outskirts of Beirut to eliminate Saleh al-Arouri and two Hamas commanders would not remain “without response or punishment”…
Values
Apple lost 3.6%, victim of a downgrade from Barclays. The broker is concerned about the potential slowdown in demand for the iPhone. Thus, the research firm revises its recommendation to ‘underweight’ and adjusts its price target from $161 to $160, which would result in a drop of 17% on current prices. “We expect a turnaround after a year in which most quarters missed consensus and the stock outperformed,” Barclays said. “Our controls remain negative regarding volumes and mix for the iPhone 15, and we do not see any features or upgrades likely to make the iPhone 16 more convincing,” tackles the broker, who previously posted a ‘weighted’ advice online’ on the file of the Californian giant from Cupertino.
Nvidia, the big stock market star of the year 2023 on Wall Street, stumbles by 2.7% on strong profit-taking.
ASML (-2.5%), the Dutch seedling giant, listed on Wall Street, has confirmed that the Dutch government has partially revoked its export license for certain lithography systems… Thus, a license for the shipment of the NXT:2050i and NXT:2100i lithography systems in 2023 was recently partially revoked by the Dutch government, affecting a small number of customers in China. The company does not expect the current revocation of its export license or the latest U.S. export control restrictions to have a material impact on its 2023 financial outlook. In recent discussions with the U.S. government, ASML has obtained additional clarification on the scope and impact of U.S. export control regulations.
Rivian corrects by 10%, the designer of electric vehicles having missed the consensus for deliveries for its fourth quarter, with 13,972 units sold against 14,400 consensus. Deliveries were down 10% compared to the previous quarter, while the rise in rates impacted demand. Rivian produced 17,541 units in the last quarter of 2023, representing growth of more than 7% sequentially. Annual production stands at more than 57,000 units, while the group’s guidance was 54,000…
Tesla (stable) is hesitating, while the news remains quite mixed on the file of the electric vehicle giant… In the United States, many EVs have just lost their eligibility for tax credits of up to 7,500 dollars, with the entry into force yesterday of new rules concerning the supply of batteries. The Cybertruck as well as certain versions of Tesla’s Model 3 are therefore removed from the list of eligible vehicles. The US administration published guidelines last month detailing new battery supply requirements to encourage domestic manufacturing.
Operators also fear competition from Chinese manufacturer BYD, supported in particular by Warren Buffett’s firm, Berkshire Hathaway. BYD will sell more than 3 million electric and hybrid vehicles in 2023, including 1.6 million electric passenger cars and 1.4 million hybrids. This represents a jump of 61.9%. The company stopped producing only gasoline and diesel cars in March 2022. For its part, Tesla announced for the fourth quarter the production of around 495,000 vehicles and deliveries of more than 484,000 vehicles. In 2023, vehicle deliveries increased 38% year-on-year to 1.81 million, while production increased 35% year-on-year to 1.85 million units. The group sold a total of 484,507 units over the last quarter, compared to around 483,200 consensus. Production, at 494,989 units, also beats the consensus which stood at 482,300 units.
DoorDash (-2.4%) is seeking to diversify beyond its core business, the Financial Times reported. In an interview, group CEO Tony Xu told the FT that with growing cash flow, “the two main areas of investment are expansion and penetration outside the US, as well as outside restaurants,” adding that the company will maintain a “high bar” before purchasing anything and that this will avoid “inefficient growth…but we’re always looking to reinvest.” Xu told the FT that DoorDash intends to expand through retail and grocery delivery, as well as its advertising unit. The article notes that DoorDash works with companies such as BJ’s WHolesale, Dick’s Sporting Goods and Sephora.
Coinbase falls by 9.8%, while Bitcoin has just reached a 21-month high of $45,000. Traders are speculating on the Securities & Exchange Commission’s verdict on a spot BTC ETF.
Voyager Therapeutics rose 6.6% on Wall Street, while the laboratory has just concluded an agreement with Novartis (+1%) including milestone payments of up to $1.2 billion. The licensing and strategic collaboration agreement with Novartis Pharma concerns the development of potential gene therapy candidates. Novartis will make an upfront payment of $100 million, including a purchase of $20 million of newly issued shares of Voyager.