Supported by the ignition of Microsoft and VISA’s financial reports, the market sentiment was stabilized. US stocks opened higher in early trading on Wednesday (27th). As the US dollar index hit a 5-year high, demand concerns after the surge in China’s epidemic, oil prices pared their losses, and energy stocks led the gains. The Nasdaq rose as much as 1.7% and then went out to close at the lowest closing price (12,488.93 points) since December 14, 2020. TSMC’s ADR fell more than 2.7%, and it closed 0.49% in half.
In political and economic news, Ukrainian-Russian tensions continued, with Gazpro stating that it had completely suspended gas supplies to Bulgaria and Poland because they did not pay in rubles. According to the market, if the EU implements a phased oil ban on Russia, Germany intends to support it.
The global epidemic of new coronary pneumonia (COVID-19) continues to spread. Before the deadline, data from Johns Hopkins University in the United States pointed out that the number of confirmed cases worldwide has exceeded 511 million, and the number of deaths has exceeded 6.22 million. More than 11.5 billion vaccine doses have been administered in 184 countries worldwide.
The performance of the four major U.S. stock indexes on Wednesday (27th):
Focus stocks
Among the five kings of technology, Microsoft stands out. Apple (AAPL-US) fell 0.15%; Meta (formerly Facebook) (FB-US) fell 3.32%; Alphabet (GOOGL-US) fell 3.75%; Amazon (AMZN-US) fell 0.88%; Microsoft (MSFT-US) ) rose 4.81%.
Dow Jones components ended up in the red. Boeing (BA-US) fell 7.53%; Cisco (CSCO-US) fell 3.12%; Verizon (VZ-US) fell 1.92%; Visa (V-US) rose 6.47%; Salesforce (CRM-US) rose 2.7%; Kaito Heavy Industries (CAT-US) rose 1.74%.
More than half of the half-constituent stocks closed in the black. AMD (AMD-US) fell 0.29%; NVIDIA (NVDA-US) fell 1.99%; Qualcomm (QCOM-US) rose 1.20%; Intel (INTC-US) fell 0.66%; Applied Materials (AMAT-US) fell 0.10% ; Micron (MU-US) fell 0.91%; Texas Instruments (TXN-US) rose 0.56%.
Taiwan stock ADR was mixed. TSMC ADR (TSM-US) fell 2.71%; ASE ADR (ASX-US) fell 0.72%; UMC ADR (UMC-US) rose 3.20%; Chunghwa Telecom ADR (CHT-US) rose 0.43%.
Corporate News
Microsoft (MSFT-US) rose 4.81% to $283.22 a share. Benefiting from the huge increase in the demand for cloud services and software for remote office work due to the epidemic, Microsoft announced its financial results for the third quarter of the 2022 fiscal year after the market on Tuesday. Both profit and revenue were better than expected, and the sales of Microsoft’s smart cloud business unit increased by 26%. Among them, cloud business revenue such as Azure increased by 46%.
Visa (V-US), the world’s largest credit and debit card company, rose 6.47% to $214.11 per share. VISA reported revenue of $7.189 billion and adjusted earnings per share of $1.79 in the second quarter of fiscal 2022 due to a recovery in international travel, both beating market expectations. The company also expects revenue to accelerate beyond pre-pandemic levels.
Boeing (BA-US) tumbled 7.53% to $154.46 a share, weighing on the industrial sector on Wednesday. Boeing’s latest earnings report both missed analysts’ adjusted losses and revenue as profits eroded as the cost of producing commercial and defense planes soared.
General Motors (GM-US) rose 1.63% to $38.66 a share. Revenue in the first quarter rose 11% year-on-year to $35.98 billion, lower than expected. Adjusted earnings per share were $2.09, better than expected. The company saw a gradual easing of the automotive chip shortage, so it maintained its full-year forecast. .
Analog IC maker Texas Instruments (TXN-US) edged up 0.56% to $169.39 a share. In the first quarter of fiscal year 2022, Texas Instruments reported earnings per share of $2.35, and revenue rose 14% to $4.9 billion, beating market expectations. However, due to China’s epidemic blockade measures, customers have stopped or reduced production, and Texas Instruments’ financial forecast is not good. .
Market rumors that Beyond Meat’s plant-based meat burger will become a permanent product on McDonald’s menu, this news inspired Beyond Meat (BYND-US) to surge by 21% during the session, and then McDonald’s responded to the news wrong, and Beyond Meat took back in late trading. Part of the gains, it closed up 7.57% at $38.22 per share.
Economic data
- The initial monthly growth rate of U.S. wholesale inventories in March was 2.3%, expected to be 1.5%, and the previous value of 2.5%
- The initial monthly growth rate of U.S. retail inventories in March was 2%, expected 1.4%, and the previous value was 1.1%
- The monthly growth rate of the US March seasonally adjusted existing home sales index is expected to be -1.7%, the previous value – 4.1%
- U.S. merchandise trade balance in March at -$125.3 billion, compared with -$106.3 billion previously
Wall Street Analysis
The Fed’s tightening policy, the European energy crisis, China’s measures to control the epidemic, and the impact of the Russian-Ukrainian war have contributed to the downturn in US stocks. The S&P has fallen 7.7% so far in April, the Nasdaq has fallen 12.2%, and the Dow Jones has fallen nearly 4%.
Matt Stucky, equity portfolio manager at Northwest Mutual, mentioned that more than three months ago, the futures market was pricing in only three to four rate hikes for all of 2022. Markets now expect the federal funds policy rate to be around 2.7% by the end of the year. So this is a marked intensification of the Fed’s tightening policy throughout the year, which is one of the main reasons for the heightened volatility.
Analysts are advising investors to prepare for more market volatility in the near term, said Kathy Entwistle, managing director of Morgan Stanley Private Wealth Management. “The supply chain has always been an issue, and then came China, inflation, which is well known. And it happens all the time, but everyone is in an environment where there’s nowhere to go and the Fed’s action will eventually happen, and that’s going to affect the markets.
Kari Firestone, chairman and chief executive of Aureus Asset Management, said the U.S. stock market is trying to stabilize and expect more companies to deliver really strong, reliable earnings and forecasts so that investors can feel confident returning to the stock market.
The figures are updated before the deadline, please refer to the actual quotation.
