(Boursier.com) — Wall Street climbs again this Friday, continuing its surge from the day before. The S&P 500 gained 0.57% to 4,324 pts, the Dow Jones 0.19% to 33,730 pts and the Nasdaq 1.09% to 13,345 pts. Yesterday evening, the technological composite index had regained 0.83% and the DJIA 0.35%. Operators seem to be overcoming their fears linked to the risk of an imminent “shutdown” (government shutdown) and those concerning the Fed’s lastingly restrictive policy… Unless some consider only an economic slowdown linked to the shutdown and the auto strike is ultimately part of the Fed’s work to reduce inflation…
On the Nymex, a barrel of WTI crude lost 0.9% to $90.9. An ounce of gold lost 0.1% to $1,877. The dollar index lost 0.1% against a basket of reference currencies. On the bond markets, the yield on the 2-year T-Bond fell slightly to 5.03%, compared to 4.52% on the 10-year and 4.66% on the 30-year. A slight relaxation is thus observed on long rates.
The goods trade deficit in the United States for the month of August 2023 stood at $84.3 billion, compared to a market consensus of $90 billion and a revised reading of $90.9 billion for the previous month. . The previous reading for July was a $91.2 billion deficit.
Personal income of American households for the month of August 2023 increased by 0.4% compared to the previous month, in line with the market consensus. Personal household expenditure, also up 0.4% compared to the previous month, should be compared to a consensus of +0.5%. The ‘core PCE’ price index is rather reassuring, up only 0.1% compared to the previous month against +0.2% consensus (+3.9% over one year)… Thus, the measurement The Fed’s preferred inflation rate shows its lowest increase since September 2021… Earlier in the day, the inflation figures in the euro zone had already pleasantly surprised, with improvements in France and Germany in particular.
The Chicago PMI manufacturing index for September 2023 stood at 44.1, compared to the market consensus of 48 and 48.7 a month earlier. This index therefore sinks below the 50 mark, signaling a sharp contraction in manufacturing activity in the region in question.
The University of Michigan’s final U.S. Consumer Sentiment Index for September 2023 came in at 68.1, compared to the consensus 67.7 and the preliminary reading of 67.7. The UoM’s measure of inflation expectations stood at 3.2%, compared to 3.1% previously.
John Williams, president of the New York Fed, also speaks today.
Note that the markets were also somewhat reassured yesterday by the more moderate comments of several central bankers, Thomas Barkin and Austan Goolsbee in particular.
Values
Nike jumped 7% on Wall Street, following a publication marked by a profit significantly higher than expectations and slightly short revenues. The stock was trading at its lowest level since September 2022. For its first fiscal quarter, the group posted adjusted earnings per share of 94 cents, compared to a consensus of 74 cents and a level of 93 cents a year earlier. Revenues totaled $12.94 billion in the quarter ended in August, very slightly below the market consensus, while they stood at $12.69 billion for the corresponding period, a year earlier. The gross margin, on the other hand, beat the consensus, at 44.2%, compared to 43.7% consensus and 44.3% a year before. Net profit was $1.45 billion, compared to $1.47 billion a year earlier.
The group appears quite confident about its prospects. Management underlines the solidity of consumption. “We continue to see very, very strong consumer demand for our brands and for our products,” says CFO Matthew Friend. These few comments on “very strong” demand therefore seem to satisfy Wall Street, with management having also reassured regarding the outlook in China, despite the current slowdown.
Nvidia (+2%). French competition authority reportedly raids local offices of US processor giant Nvidia, indicated the Wall Street Journal yesterday Thursday. The authority revealed this search on Wednesday morning without specifying the practices targeted or the group concerned, just specifying that the “raid” concerned the graphics card sector. This week’s operation would follow a broader investigation into the cloud computing sector over concerns that industry groups are using their access to computing power to exclude smaller competitors, Reuters adds. The Wall Street Journal therefore affirms that this week’s operation was indeed aimed at Nvidia, a graphics and AI chip giant and a big star on Wall Street in recent months. The WSJ raises suspicions of anti-competitive practices.
BlackBerry (-2%) and Veritas Capital are only conducting initial discussions for the time being, according to Bloomberg, citing people familiar with the matter. The agency’s report said that during yesterday’s conference call, BlackBerry CEO John Chen said he saw a better chance that the company’s strategic review would be completed before the expiration of his contract in November, but he did not comment on speculation surrounding Veritas’ purchase of BlackBerry. Last night, BlackBerry published a loss per share of 4 cents for its second fiscal quarter, compared to a consensus of -2 cents and a deficit of 5 cents per share a year earlier. The former star of personal assistants achieved quarterly revenues of $132 million, in line with market expectations, compared to $168 million a year earlier.
Microsoft (+1%) had considered selling its Bing search engine to Apple (+1%) around 2020, according to Bloomberg. People with knowledge of the matter say a possible deal would have replaced Google as the default search engine option on Apple devices. Microsoft executives spoke at the time with Apple’s services chief Eddy Cue, who had previously renegotiated the Google deal. However, the discussions were exploratory and never reached an advanced stage, the agency indicates. Bloomberg’s sources add that Apple, which is receiving billions of dollars from Google to give its search engine a prominent place on the iPhone and other devices, decided not to acquire Bing because of the money generated by its agreement with Google, but also its concerns about Bing’s ability to compete with Google…
Furthermore, according to the Wall Street Journal, Apple reportedly met with Chinese officials in recent months to discuss new rules preventing it from offering programs in China from foreign publishers available on its application store.
Nio (stable), the Chinese manufacturer of electric vehicles listed on Wall Street, remains surrounded on the stock market today. The Reuters agency cites two sources affirming that the group would study an alliance with Mercedes-Benz, within the framework of which the German would invest in the capital of the Chinese in exchange for technological collaboration.
carnival (-4%), the American cruise giant, corrects on Wall Street following its quarterly publication, although marked by historic revenues. For its third fiscal quarter, the group generated a net profit of $1.07 billion, compared to a loss a year before. The Miami group posted earnings per share of 79 cents, as well as adjusted EPS of 86 cents compared to a consensus of 73 cents. Quarterly revenues totaled $6.85 billion, compared to a consensus of $6.7 billion. Quarterly adjusted EBITDA of $2.22 billion exceeds June guidance.
Booking volumes in the third quarter continued at “significantly elevated” levels, setting a new record for the quarter. For the quarter started this time, Carnival anticipates a loss per share ranging from 10 to 18 cents. For fiscal 2023, adjusted Ebitda is expected between $4.1 and $4.2 billion, including $800 to $900 million in the fourth quarter.