Wall Street is heading in the green this Monday with Apple and Tesla, before a week marked by numerous statistics and quarterly company publications, but also by the Fed’s monetary meeting. The S&P 500 gained 0.30% to 5,115 pts, the Dow Jones 0.17% to 38,305 pts and the Nasdaq 0.38% to 15,988 pts. On the Nymex, a barrel of WTI crude lost 1.2% to $82.8. An ounce of gold gains 0.1% to $2,348. The dollar index lost 0.1% against a basket of reference currencies.
In economic news this Monday, the Dallas Fed’s regional manufacturing index for the month of April stood at -14.5, strongly negative, which signals a clear contraction in manufacturing activity in the region considered. The consensus was -11 over the period. The indicator was -14.4 in March.
The Employment Cost Index, the S&P Case-Shiller and FHFA Home Price Indexes, as well as the Chicago PMI and the Conference Board Consumer Confidence Index, will be announced tomorrow.
The ADP report on private employment, the ISM and PMI manufacturing indices, the JOLTS report on job openings and the DoE weekly report on domestic oil stocks will be announced on Wednesday, but it is mainly the Fed which will attract attention in the evening, with its monetary press release which will be followed by the traditional press conference by Jerome Powell. It is extremely likely that the Fed will once again leave rates unchanged between 5.25 and 5.5%, given the still high level of inflation, as well as the resilience of employment and the economy American. The whole question is therefore to know when the American central bank will finally be able to relax its policy. According to the CME Group’s FedWatch tool, the probability of a new status quo on Wednesday is approximately 97%. There is even more than 88% probability that the central bank will still leave its rates unchanged on June 12, after the next meeting, and even more than 70% probability that the status quo will persist on July 31 . It is therefore possible that the Fed will only start reducing rates in September or November…
On Thursday, operators will follow the Challenger, Gray & Christmas study on company layoff announcements, the balance of international trade in goods and services, weekly unemployment registrations, quarterly non-agricultural productivity figures, as well as American industrial orders.
Finally, on Friday, the monthly government report on the employment situation for the month of April will be announced. The final composite PMI index for April and the services ISM will also be revealed on the same day. John Williams and Austan Goolsbee from the Fed will also speak on Friday.
The quarterly financial results season continues on Wall Street, with this Monday NXP Semiconductors, Welltower, Arch Capital, ON Semiconductor and MicroStrategy, as well as Domino’s Pizza and Paramount.
Eli Lilly, Coca-Cola, McDonald’s, PayPal, 3M, Air Products & Chemicals, Illinois Tool Works and Eaton report Tuesday before market, while Amazon, AMD, Stryker, Starbucks and Mondelez report after the close.
Mastercard, Qualcomm, Pfizer, ADP, CVS Health, KKR, Marriott, MetLife, Estée Lauder, DoorDash, AIG, Allstate, Johnson Controls, Yum! Brands and Kraft Heinz, announced in particular on Wednesday.
Apple will dominate Thursday evening with its latest financial results. Amgen and Booking Holdings will also release Thursday evening. ConocoPhillips, Cigna, Regeneron Pharmaceuticals, Zoetis, Moody’s, Motorola Solutions, Monster Beverage, Coinbase, Block Inc, Cummins, Intercontinental Exchange and Southern Company will also be there on Thursday…
Values
Tesla soars 11% on Wall Street, stimulated by hopes regarding the Chinese deployment of its FSD. Elon Musk went to China yesterday for a “surprise visit”, reports Reuters. People with knowledge of the matter said the multibillionaire wanted to meet with senior Chinese officials to discuss Tesla’s introduction of Full-Self Driving assistance software in China, and that he also wanted permission to moving data collected in China overseas to improve Tesla’s self-driving algorithms. According to local media, Musk met Prime Minister Li Qiang in Beijing, but also Ren Hongbin, head of the organizing committee of the Beijing auto show, which is currently taking place and where Tesla is not represented…
Also importantly, Chinese Internet search giant Baidu struck a deal with Tesla to grant the Texas automaker access to its mapping license for data collection on Chinese public roads, two people familiar with it said. of the file cited by Reuters. The agreement would remove a final regulatory obstacle for Tesla’s driver assistance system, FSD, which could thus be offered in China according to sources. In China, intelligent driving systems must obtain a qualification in mapping before they can operate on public roads. Foreign companies must therefore partner with domestic companies that have obtained the license – and of which Baidu is one.
Apple (+3%), the Californian technology giant from Cupertino, would renew negotiations to use the technology of the artificial intelligence startup OpenAI in its new iPhone operating system this year, Bloomberg understands. People familiar with the matter said the companies were talking about a possible deal and how OpenAI features could be used in Apple’s iOS 18. The report states that Apple is also still in talks to license the Gemini chatbot from Google (Alphabet).
In other news, Bloomberg reports that Apple’s iPad has been added to a list of products and services from major technology companies affected by strict new European Union rules aimed at stopping potential competition abuses. before they settle down. Apple has six months to ensure its tablet ecosystem complies with a series of preventative measures under the EU’s flagship digital markets law. Apple’s iOS mobile operating system and App Store, as well as the Safari browser, are already targeted. Apple challenged its designation for certain services at the EU General Court in Luxembourg.
Finally, Bernstein has just raised his recommendation on the Apple file from ‘market performance’ to ‘outperformance’ before the accounts, deeming it wise to buy at the current low by taking advantage of the “fear” of the markets.
Alphabet (-2%) consolidates on Wall Street this Monday, after having exceeded $2,000 billion in market capitalization last week thanks to solid quarterly results accompanied by a first dividend and copious share buyback plans. In addition, Google has clarified its intention to invest three billion dollars in data centers in Indiana and Virginia, due to the demand generated by AI.
Domino’s Pizza (+3%) climbs on Wall Street, while the restaurant chain beat the consensus for its first quarter. Global revenues increased 7.3% from a year earlier, excluding currency effects, to $4.36 billion. Profit stood at $3.58 per share, also exceeding analysts’ estimates ($3.4 consensus). The group benefited from the attraction of American consumers for its loyalty program. The pizza chain has also developed new promotional offers attracting consumers in a context of persistent inflation. Like-for-like quarterly sales in the United States rose 5.6%, compared to a 4% consensus. The group’s CEO, Russell Weiner, also talks about the successes of the preparation and delivery activities. Domino’s revamped its loyalty program last year and sealed a delivery partnership with Uber Eats. Lower costs and higher franchise fees supported margins in the quarter.
SoFi Technologies (-8%), personal finance group, has just raised its 2024 forecasts following accounts higher than expectations for the first fiscal quarter. The group reported another profitable quarter and estimated that 2024 remained a year of transition. SoFi had first-quarter revenue of $645 million for GAAP net income of $88 million. Total adjusted net revenue increased 26%. Annual adjusted net revenues are anticipated between 2.39 and 2.43 billion. Adjusted Ebitda is expected to be between $590 and $600 million, a margin of 25% for revenue growth of 15 to 17%. Annual GAAP net income is expected to be between $165 million and $175 million, or EPS of 8 cents to 9 cents.
Paramount Global (+5%). According to Bloomberg, the Redstone family, controlling shareholder of Paramount, and the CEO of Skydance Media, David Ellison, offered concessions to other investors in Paramount’s capital, while some shareholders wanted the group to study other alternatives. Remember that Shari Redstone is considering selling her stake in David Ellison’s Skydance media firm. Bloomberg earlier this month cited sources familiar with the matter as saying that Skydance would hold exclusive discussions with a panel of independent Paramount directors as part of the potential deal to acquire the Redstone family’s National Amusements holding company. National Amusements directly or indirectly owns 77% of Paramount’s voting stock, giving it control of the movie studios and TV networks.
