(Boursier.com) – Wall Street is now oriented sharply higher on Tuesday. The S&P 500 takes 1.32% to 4,449 pts and the Dow Jones 1.17% to 34,815 pts. The Nasdaq advances by 1.71% to 13,560 pts. On the Nymex, the barrel of WTI crude corrected by 4.4% to $102.9, which is a relative comfort, while the ounce of gold for its part fell by 1.5% to $1,957. The dollar index advanced 0.2% against a basket of currencies. Bitcoin goes back to $41,000. On the bond markets, the yield on the 10-year T-Bond has now reached 2.92%, while the 30-year is trading at 3%.
In economic news on Tuesday on Wall Street, housing starts and building permits for the month of March narrowly exceeded expectations, at 1.79 million and 1.87 million respectively (FactSet consensus at the rate of 1 .75 million for housing starts and 1.82 million for permits). The Fed’s Charles Evans and Neel Kashkari will speak during the day.
St. Louis Fed boss James Bullard told CNBC that he wouldn’t rule out a 75 basis point rate hike, even though that’s not his baseline scenario for the meeting. of the May FOMC (May 3-4). Bullard also said the Fed did not want to disrupt markets, but needed to act quickly. He said a benchmark rate of 3.5% was the minimum the Fed needed and that it should try to achieve it by the end of the year. Bullard also touched on the ‘soft landing’ theme, saying he doesn’t think unemployment will rise and may fall further as the Fed raises rates, eventually falling below 3%. This year. He also said GDP growth this year and next would be “above trend.”
For the time being, the markets are expecting rate hikes of 50 basis points at the Fed’s next monetary meetings. The CME’s FedWatch tool shows a nearly 91% chance of a 50bp hike in May, then a roughly 94% chance of a further 50 or 75bp tightening in June.
Tomorrow Wednesday, operators will also be able to follow resales of existing homes, the report on US domestic oil stocks, the Fed’s Beige Book, as well as interventions by Mary Daly, Charles Evans and Raphael Bostic (Fed). Jerome Powell, president of the American central bank, will speak for his part on Thursday.
Markets remain cautious in the face of fears about global growth, after the new estimate of 3.2% provided by the World Bank for this year, adjusted downwards with the health crisis, inflation and the war in Ukraine. Russia begins its military offensive in eastern Ukraine, Volodymyr Zelensky said. Ukraine’s president said on Monday that Russia has launched its military offensive in eastern Ukraine following a recent boost in troops and equipment. Ukrainian troops in Mariupol continue to defy Russian demands to surrender, hampering Moscow’s preparations for an eastward offensive. US officials say the Russian occupation of Mariupol could then free up more battalion groups for use in Donbass. As fighting in eastern Ukraine is expected to intensify, the United States said it plans to begin training Ukrainian troops in the coming days in the use of heavy weapons to combat troops Russians. The White House is also considering new sanctions against Russia and may announce more information in the coming days. EU leaders are also assessing more actions. However, efforts remain complicated by the bloc’s reliance on Russian energy and the need to secure alternative sources.
In business news on Wall Street today, Johnson & Johnson, netflix, Lockheed Martin, Prologis, IBM, travelers, Halliburton, Fifth Third Bancorp, Omnicom, FirstHorizon, Hasbro Where ManpowerGroupwill notably announce their latest quarterly financial results.
Values
Twitter (-2%) remains monitored, after the offer of more than 43 billion dollars from Elon Musk, who had previously risen to 9.1% of the capital of the social media network. Apollo Global Management is reportedly considering participating in Twitter’s takeover bid, according to The Wall Street Journal. The WSJ reports that Apollo had discussions about the possibility of providing capital to support a takeover bid from Elon Musk or another bidder on Twitter. The New York Post previously reported last week that Thoma Bravo was considering an offer on Twitter, and then reported yesterday that Musk was looking for partners for his offer.
Johnson & Johnson (+3%). The American group active in pharmaceuticals and consumer products announced revenues below expectations and lowered its guidance from this point of view, due to disappointing sales of treatments. For the first quarter, J&J posted net income of $5.15 billion, or $1.93 per share, compared to $6.2 billion a year earlier. Adjusted earnings per share were $2.67. Total revenue rose 5% to $23.4 billion. The consensus was $2.59 in adjusted earnings per share on $23.6 billion in revenue. Operational growth nevertheless reached 7.7% over the quarter ended. The group maintains its annual guidance for adjusted profit and “adjusted operating sales”. Guidance on sales of covid vaccines has been suspended. Total revenue is now expected between 94.8 and 95.8 billion, 1.1 billion lower than the previous range.
Halliburton (+1%), oil services giant, announced on Tuesday an 85% increase in its adjusted profit, boosted by the rise in crude prices and its impact on sector demand. The Houston group posted an adjusted profit of $314 million or 35 cents per share for the period to the end of March, compared with $170 million a year earlier. A pre-tax charge of $22 million was taken in the quarter for impairment of assets in Ukraine. Consolidated net income was $263 million or 29 cents per share. Revenues totaled $4.3 billion, compared to $3.5 billion in the corresponding period a year earlier. Operating profit was 511 million, against 370 million a year earlier.
travelers (-4%), the American insurer, announced for the quarter closed a growth of nearly 50% of its profit, with the fall of the losses for catastrophes, and in spite of the losses on investments. Adjusted profit was $1.04 billion, or $4.22 per share, for the period to the end of March, versus $699 million a year earlier. The consensus was $3.57 adjusted EPS. The New York group. Net written premiums increased 11% year-on-year to $8.37 billion. The combined ratio was 91.3%, compared to 96.6% a year earlier.
Hasbro (+4%), one of the American toy giants, announced for its first fiscal quarter a net profit of 61 million dollars or 44 cents per title, against 116 million dollars a year earlier. Adjusted earnings per share were 57 cents, versus a FactSet consensus of 62 cents. Revenue improved 4% year-on-year to $1.163 billion. The consensus was at $1.15 billion. However, betting on strong demand for games, including ‘Magic’ and ‘Dungeons & Dragons’, the group is raising its earnings guidance. Over the quarter, the Monopoly-branded group improved its revenues by 4% to 1.16 billion dollars, against 1.15 billion consensus. For 2022, operating profit is expected to grow by around 5%. The annual revenue impact of Russia’s invasion of Ukraine is estimated at $100 million.
Lockheed Martin (-1%), the American defense contractor, publishes for the first quarter a profit higher than expectations, but a little short income. The aerospace and defense giant reported net income for the quarter of $1.73 billion, $6.44 per share, versus $1.84 billion a year earlier. The FactSet consensus was $6.11 EPS. Revenue, however, declined 8% year-on-year to $14.96 billion, versus market consensus of $15.6 billion. Annual revenues for 2022 are expected to be around $66 billion, for diluted EPS of $26.7 and free cash flow greater than or equal to $6 billion.