(Boursier.com) — Wall Street ended in sharp decline this Friday evening in a very heavy geopolitical context, while the separatist leaders in eastern Ukraine announced the start of the evacuation of thousands of residents to Russia, while the bombings continued intensify in the region for the second consecutive day, making Westerners fear that Moscow will find there a pretext to invade its neighbor… The DJ lost 0.68% to 34,079 pts. The S&P fell 0.72% to 4,349 pts. The Nasdaq fell another 1.14% to 14.00ç points.
“As of today, February 18, a centralized mass evacuation of populations to Russia has been organised”, announced Denis Pushilin, leader of the self-proclaimed “people’s republic” of Donetsk, specifying that priority would be given to women, children and the elderly. Pro-Russian separatists in Donetsk plan to evacuate around 700,000 people.
Most residents of Ukraine’s separatist-held regions of Donetsk and Luhansk are Russian-speaking, and Moscow has already granted Russian citizenship to many of them.
Meanwhile, Russia has been claiming for several days to have started the withdrawal of some 100,000 soldiers that it had massed on the Ukrainian borders, but Western countries believe that the troop movements conversely reflect an intensification of preparations for a offensive. “We see additional deployments of (Russian) troops towards the (Russian-Ukrainian) border including advanced forces that would be involved in any form of aggression,” US Secretary of State Antony Blinken told the conference in Munich on security.
According to a new estimate delivered Friday by the American ambassador to the Organization for Security and Cooperation in Europe (OSCE), Michael Carpenter, the United States is now assessing the number of soldiers deployed by Russia on the borders of the Ukraine between 169,000 and 190,000, nearly double the 100,000 men counted at the end of January. “This is the largest mobilization in Europe since the Second World War,” said Michael Carpenter.
Despite these growing tensions, which relate more generally to Russian security requirements vis-à-vis the United States and NATO, diplomatic negotiations continue… Antony Blinken accepted an invitation from the Minister Russian Foreign Minister Sergei Lavrov for a meeting at the end of next week.
Russia’s ambassador to the UK said the future meeting could be held in Finland or Geneva, Switzerland, according to Russian news agency Interfax.
ECO AND CURRENCIES
On the monetary front, speculation on the strategy of the US Federal Reserve continues: Thursday, James Bullard, the president of the St. Louis Fed, reiterated his support for a rate hike of 100 basis points of July to stem inflation and her Cleveland counterpart, Loretta Mester, said the pace of increases should be faster than in previous cycles of monetary tightening.
In addition, the US Congress on Thursday approved a text extending federal funding until March 11 in order to avoid a partial closure of the administration (“shutdown”) and the embarrassing spectacle of seeing the operations of federal agencies be interrupted in full crisis around Ukraine. The bill was approved by the Senate within hours of the expiration of the current budget envelope for most federal operations. Democrats and Republicans now have until March 11 to reach an agreement on a broad budget proposal until September 30, the end of the current fiscal year.
Finally, the macro indicators of the day were quite mixed in the United States. On the good news side, resales of existing homes in January came out at a rate of 6.5 million units, against 6.1 million consensus and 6.09 million a month earlier, in revised reading. The median price is up 15.4% year on year to $350,300, data from the National Association of Realtors shows.
The Conference Board’s index of leading indicators, on the other hand, disappointed, posting a decline of 0.3% in January compared to the previous month, against a consensus of +0.2% and a reading revised to +0.7% for the preceding month.
The barrel of Brent rises to $93.60 tonight. The ounce of gold remains firm at $1,898. Bitcoin is pointing to $40,100 and the euro is hovering at $1.13 between banks.
Values
Dupont loses 1.2%. The US industrial materials maker has announced the sale of its mobility and materials division to Celanese, a specialty chemicals group, for $11 billion, as part of its refocus on electronics, automotive and electronics. hydraulic solutions.
Berkshire Hathaway (+0.3%). Warren Buffet’s company, which acquired nearly a million shares of Activision Blizzard ahead of Microsoft’s $68.7 billion takeover of the video game maker, said Thursday that the investment had been made without knowledge of the projects of the Windows editor.
Intel 5.3% drop the day after an investor day in which Pat Gelsinger, Intel’s chief executive, said he expects the group’s profit margin to fall this year, then stabilize for several years before rebounding from 2025 due to the investments decided by the semiconductor manufacturer to meet demand and face fierce competition. In detail, the chip giant estimates that its sales will rise to $76 billion in 2022, before climbing 5 to 9% in 2023 and 2024. Analysts have so far forecast growth of 1% this year, before 3% in 2023 and 8% in 2024. On an adjusted basis, Intel anticipates EPS of $3.50 in 2020 against $3.44 consensus. “I am confident in our acceleration and delivery plan,” the executive said at the event. The adjusted gross margin is expected to fall to 52% this year from nearly 58% in 2021.
So far, Intel has struggled to take advantage of the surge in demand for chips, fueled by the development of working from home, the transition to electric in the automobile or the growth of connected objects. While chip industry sales jumped 26% last year to a record total of $556 billion, Intel fell 4%. Pat Gelsinger outlined a plan to spend tens of billions on new factories that will put him in direct competition with outsourced manufacturing suppliers such as Taiwan Semiconductor Manufacturing and Samsung Electronics. At the same time, he is shaking up Intel’s internal production technology and targeting a return to leadership by 2025. CFO Dave Zinsner has promised him increased financial discipline as Intel tries to regain market share and to enter new sectors.
You’re here (-2.2%). China’s market regulator announced on Friday that Tesla will recall 26,047 Model 3 and Model Y vehicles produced by the US automaker in China.
Shake Shack yields 4.1%. The fast food chain is shaken before the market after having revealed a disappointing guidance for the quarter due to the Omicron variant. The group expects sales of between $196 million and $201.4 million in its first fiscal quarter, while the market was expecting $211 million. Additionally, given the considerable uncertainty and resulting significant economic impact caused by the pandemic, the Company has not provided annual targets. Over the last three months of its financial year, the New York group saw its revenues jump 20.8% on a comparable basis to $203.3 million ($202.6 million consensus).
Deere & Co. fell 3% as the world’s largest maker of agricultural equipment raised its full-year profit forecast, expecting margins to rise on the back of higher prices and solid demand. The group is now aiming for a profit of between $6.7 and $7.1 billion compared to $6.5 to $7 billion previously. In the quarter ended at the end of January, the company recorded a net profit of $903 million or $2.92 per share against $2.27 of consensus. Sales rose 5% to $9.57 billion, versus $8.28 billion expected by analysts. Cost of sales jumped 15.3% to $6.70bn amid production issues related to the late ratification of a union contract and “continuing challenges” posed by supply chain issues and the Covid-19 pandemic.