(Boursier.com) — Wall Street is about to bounce back. The day after another session of sharp decline, the S&P 500 index ending below the threshold of 4,000 points for the first time since March 31, 2021, and the Nasdaq giving up 4.3%, the American place should benefit from purchases cheaply to regain some height. Futures are moving quite clearly in the green 30 minutes from the open, even if the trend remains fragile, to say the least, against a background of rising interest rates and slowing global growth. The health situation in China, which is disrupting supply chains and raising fears of a marked drop in demand, has also weighed on the trend for long sessions.
Investors remain focused on future increases in central bank interest rates, after bullish gestures last week from the US Federal Reserve, the Bank of England and the Australian Reserve Bank. Faced with high inflation, further accentuated by the war in Ukraine, the markets anticipate the continuation of a tightening of monetary policy, particularly in the United States, where futures markets expect another 50bp tightening in June, followed by at least another 50bp hike in July, or even September, according to CME Group’s FedWatch tool.
Inflation figures for April will be published on Wednesday in the United States, China, Germany and France. across the Atlantic, the consensus expects a slight slowdown in price increases to 8.1% in April over one year after 8.5% in March, the strongest rise since 1981. The pace of growth in the ‘core’ CPI, which excludes the most volatile elements, should also slow to 6% over one year after 6.5% in March.
A sign of the slight lull in the markets on Tuesday, the index VIX volatility, nicknamed “the fear index”, fell 4.4% around 33.2 pts. However, it remains well above its 200-day moving average (21).
On the corporate front, 87% of S&P 500 companies reported first-quarter results. On Friday, the percentage of S&P 500 companies beating analysts’ EPS estimates was above the five-year average, but the magnitude of upside surprises was below the five-year average, the data showed. of FactSet. “Another catalyst that could cause some risk aversion is a fairly disappointing earnings season,” Brian Price, head of investment management at Commonwealth Financial Network, told ‘Yahoo Finance’. “It certainly wasn’t as strong as recent quarters and there is even more ambiguity around the future outlook for EPS given the huge macro uncertainty.”
In the bond markets, yields are falling a bit but still close to their multi-year high. The performance of T-Bond at 10 years fell 5.1 basis points to 2.983%, but remained close to its highest level since November 2018. The rate of T-Bond at 2 years relaxes 0.6bp to 2.588%. The Treasury is due to issue 45 billion three-year securities on Tuesday, 36 billion ten-year securities on Wednesday and $22 billion in 30-year securities on Thursday.
Up slightly this morning, oil prices fell again after dropping more than 5% on Monday on fears of a slowdown in demand fueled by prolonged confinements in China and monetary tightening in Western countries. And this while discussions around a possible embargo on Russian oil continue in Europe. The barrel of American light crude WTI (June futures contract) fell 0.5% to $102.6 on the Nymex, while the Brent North Sea fell 0.7% to $105.2 for the July contract.
gold gained 0.3% to $1,860 an ounce for the June Comex futures contract. On the crypto side, the bitcoin drops another 3.6% over 24 hours, around $31,755 on Coindesk, victim of general risk aversion.
In the currency market, the dollar index is trading at its 20-year highs against a basket of benchmark currencies, at 103.7 pts (+0.1%). euro is almost stable against the greenback, at $1.0551 on the interbank markets in New York.
VALUES TO FOLLOW
* You’re here is almost at a standstill in China. In April, the automaker delivered just 1,512 vehicles from its Shanghai plant, according to data from the China Passenger Car Association. Data to be compared to nearly 66,000 shipments in March and the monthly record of nearly 71,000 vehicles delivered in December 2021. In addition, an internal Tesla memo consulted by ‘Reuters’ shows that the American group has suspended the essential of its production in its Shanghai factory as the Chinese economic capital entered its sixth week of confinement due to Covid-19. The factory, which makes Tesla’s Model 3 and Model Y, reopened on April 19 after a 22-day shutdown, the longest since the site opened in late 2019. But like many of the hundreds of companies that have reopened factories in Shanghai in recent weeks, Tesla is not escaping the difficulties of getting production lines back up and running while keeping workers on site in a “closed loop” system. Even if they manage to get everything right, these companies depend on vendors facing similar challenges.
In addition, the automaker must recall about 130,000 vehicles in the United States due to an overheating problem that could lead to a malfunction of the central touch screen, announced the National Highway Traffic Safety Administration (NHTSA). According to the regulator, overheating of the infotainment system’s processor could prevent the central display from displaying images from the rear-view camera, warning lights and other information. The recall covers 2021 and 2022 Model S and X and its 2022 Model 3 and Y. The electric vehicle maker will provide an over-the-air software update to fix the issue, according to NHTSA.
* Novavax plunged more than 20% in pre-session on Wall Street despite the announcement of the first profitable quarter in its history. The laboratory delivered only 31 million doses of its Covid-19 vaccine in the first quarter out of the two billion it plans to sell this year. Novavax, however, reiterated its 2022 revenue forecast of between $4 billion and $5 billion, saying it expects vaccine sales to accelerate in its key markets in the current quarter. “We expect to see further gains in these markets in the coming months as demand continues with recent Covid surges around the world,” Chief Commercial Officer John Trizino said. In the first quarter, the firm posted a net profit of $203 million ($2.56 per share) against a loss of $223 million a year earlier for revenues of $704 million. The consensus was positioned higher with an anticipated EPS at $2.65 and expected revenue at $806.8 million.
* AMC Entertainment is gaining pre-market traction after the movie theater operator reported better-than-expected quarterly revenue and a reduced net loss on the back of the success of big-budget movies like “The Batman.” Over the first three months of the year, the firm suffered an adjusted loss per share of 52 cents for revenues of $758.7 million. Data better than expected by analysts. “Our results for the first quarter of 2022 represent AMC’s best first quarter in two full years. We continue our post-pandemic recovery trajectory, in addition to quintupling revenue and improving adjusted EBITDA by nearly 80% versus to a year ago,” AMC CEO Adam Aron said.
Ticket sales have increased more than fivefold from the previous year, when cinemas were still mostly closed due to the coronavirus pandemic. However, they are still far from the levels that prevailed before the pandemic: regularly more than a billion dollars in the first three months of the year. While it will probably take years for box office receipts to return to pre-health crisis levels, the release of several blockbusters over the summer (“Top Gun: Maverick”, “Jurassic World Dominion “…) could help movie theater chains get back on their feet faster.
* Microsoft announced Monday evening its intention to cover the travel costs that could be incurred by its employees in the context of a voluntary termination of pregnancy while the US Supreme Court could put an end to the constitutional right to abortion.
* Meta Platformsthe parent company of Facebook, plans to reduce the amount of commissions paid to press groups as part of a reassessment of the partnerships concluded in recent years, understands the specialized site ‘The Information’, citing sources familiar with the matter.
* Match Groupthe owner of Tinder, is suing Google, a subsidiary of Alphabet, in California for anti-competitive practices within the Play Store, the Internet giant’s application store.
* Verizon, Comcast, AT&T. Twenty internet service providers in the United States have pledged to lower their prices or increase the speed of their packages for millions of low-income households, US President Joe Biden said on Monday.
* Lucid Group. The American manufacturer of electric vehicles has announced its intention to market high-end sedans in Europe later this year in order to expand its presence beyond the United States.
* Blackrock announced its intention to oppose certain shareholder resolutions during general meetings this year, deeming certain proposals, in particular on climate change, too restrictive and “incompatible with the long-term financial interests of its clients”.
* Carlyle Group has reached an agreement with White Mountains Insurance Group to acquire insurance broker NSM Insurance Group for $1.78 billion in cash.