Here is what to remember from the stock market news of Wednesday April 25.
The markets: Tech shines!
The Paris Stock Exchange closed down this evening, -0.17% at 8092 points, affected by company results which did not really convince investors. The majority of today’s publications lead to corrections, in particular Kering which fell by 6.87% after forecasts of a notable drop in its operating income for the first half. We will tell you more about it in the rest of this Journal, largely dedicated to the dividend season which is beginning. Given the current geopolitical context, and the more cautious approach of central banks regarding rate cuts, the market is looking for stability. Should you look for it in the Nasdaq? Technology sectors are showing signs of recovery, encouraged by the continued rise of artificial intelligence. This is particularly the case for Texas Instruments which gained 8%, following the publication of good results. Tesla also impresses, discover this in this edition. Furthermore, tensions on rates are increasing following the publication of orders for durable goods in the United States, up 2.6% in March, with a sharp increase in the transport sector. These data, in addition to the IFO business climate index in Germany, do not allay concerns about inflation, nor uncertainty about future rate cuts from the Fed and the ECB.
Values: Kering, STMicroelectronics and Voyageurs du monde
Kering Kering suffers a new fall on the stock market: -6.87% 326.15. The luxury giant revealed disappointing quarterly results, heavily punished by the market. Its sales contracted by 10% at the start of the year, weighed down by its flagship brand Gucci. The outlook for 2024 confirms a drop in operating income compared to the previous year, with a forecast drop of 40% to 45% for the first six months! The reason is the persistent difficulties of Gucci, which represents the majority of the group’s revenues. Weak sales, particularly in Asia-Pacific and particularly in China, constitute a major challenge for Kering. The polarization of Chinese customers, preferring either very high-end products or more affordable items, affects Gucci, which is perceived as neither high-end nor accessible enough. The group is banking on an improvement in the second half, with the launch of new collections and the introduction of new products. Management expects a significant improvement in operating margin over the period. The stock has fallen 17.5% since the start of the year, and very soon, we will update our long-term recommendation. STMicroelectronics Conversely, it is a solid success for STMicro which signs the best performance in the CAC: +5.39% 39.22 (-12% in 2024). The positive dynamics of the American Texas Instrument in the semiconductor market are propelling shares in the sector globally. Texas Instrument’s results, considered a leading indicator for the entire valuable chip industry, indicate a resumption of orders after resellers’ stocks were exhausted, which is interpreted as a favorable signal for the sector as a whole. together. Texas Instrument, however, recorded a 16% drop in revenues in the first quarter compared to the previous quarter, but its outlook for the rest of the year is significantly more optimistic. Above all, its forecasts are more encouraging than those anticipated by the market. STMicro is therefore soaring due to sectoral correlation but be careful… the group will publish its own quarterly data tomorrow World travelers The tailor-made tourism specialist soars this evening by 8.53% 140 after announcing a share buyback plan worth 130 million euros, equivalent to approximately 20% of its capital. This initiative echoes the amount raised in 2021 during the health crisis to strengthen its cash flow. The buyout decision comes after a period of strong recovery in activity, with turnover for 2023 up 39.5% and net profit up 47.6%. This buyback operation will be carried out at 150 euros per share, with a significant premium compared to the current price. It is seen as an opportunity for shareholders to liquidate their holdings at an attractive price. The share eligible for the PEA-PME has gained 10% since the start of the year.
Tomorrow’s headlines: Two major meetings
This weekend promises to be very interesting. Tomorrow, a heavyweight weapon will focus the attention of investors: Microsoft, Alphabet (Google), Herms, Airbus, Schneider Electric, Sanofi, BNP Paribas, Vinci, Pernod Ricard and… STMicroelectronics. The stock market impact will be felt until this weekend, to the extent that the Americans will publish their results after the European close, due to the time difference. But that’s not all. Uncle Sam will present an estimate of its first quarter growth. The figures should clearly make the euro zone blush with jealousy, we’ll talk about it again tomorrow evening.
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The world after: MorningStar’s top 10
Some food for thought for your stock market portfolios! High-dividend stocks are a pillar of financial stability for investors. In France, several companies stood out in the first quarter for their stock market performance but also for their very attractive dividends. Faced with a growing interest in serene investment strategies, the search for dividends is emerging as a crucial approach for many investors. The independent financial media MorningStar highlights the 10 best-performing French fixed income stocks that have healthy financial balance sheets. In short, excellent balance sheets and big dividends. What are these 10 ppites? Rubis, Renault, Accor, Coface, Bureau Veritas, Spie, Nexans, Scor, Publicis and Stef
The glossary: DIVIDEND
Back on an essential basis! A dividend is a portion of a company’s profits distributed to its shareholders. It represents the remuneration that shareholders receive in exchange for their investment in the company. Dividends are generally paid periodically, every year or more rarely every quarter. The amount distributed to each shareholder is proportional, it depends on the number of shares held. Companies can choose to reinvest part of their profits rather than distributing them in the form of dividends, which is often the case in growth phases where they prefer to use these funds to finance new projects or to strengthen their cash flow.