Wall Street under pressure, ahead of the Fed, Apple, Amazon and Alphabet
(Boursier.com) – Wall Street fell on Monday, with the S&P 500 down 0.85% to 4,035, the Dow Jones down 0.20% to 33,911 and the Nasdaq down 1.7% to 11,424. The barrel of WTI brand oil fell by 1% to 78.9 dollars. An ounce of gold has stabilized at the level of 1926 dollars. The dollar index rose by 0.1% against the basket of currencies. Operators are very cautious ahead of the Fed meeting and the quarterly accounts of tech giants, especially 3A, Amazon, Alphabet and Apple, which will publish on Thursday evening. Among the country’s top strategists, JP Morgan and Morgan Stanley warned in the short term, agreeing to the recent stock market rally despite monetary policy remaining restrictive.
Wednesday’s decision by the Fed’s monetary policy committee, the FOMC, is likely to be the highlight of a busy macroeconomic week. Markets expect the Fed to slow its rate of tightening to 25 basis points and keep the Fed funds rate between 4.50% and 4.75%. This assumption receives a large majority of economists’ “votes”, with the CME Group’s FedWatch tool giving it a 98% probability.
Expert expectations underscored expectations for a unanimous decision and indicated only minor changes to the policy statement. So the Fed’s statement should reiterate forward guidance that “sustained increases” in the Fed funds rate would be appropriate. Jerome Powell’s press conference may have been relatively warmongering. The Fed chief recently indicated that despite the slowdown in the pace of tightening, the Fed still has work to do on inflation, particularly the still-tight labor market. Powell should also reiterate his cautious stance on the prospect of further easing as markets expect a turnaround in the second half. Thus, the head of the US central bank could confirm his views from the December meeting that the monetary policy will remain tight “for a while”. Additionally, Powell may note that the December SEP (Summary of Economic Projections) points are holding despite the disinflation story being pulled…
The Fed’s monetary statement will be released at 8:00 PM on Wednesday, with Powell’s press conference at 8:30 PM. The following day, investors will follow the monetary announcements of the Bank of England and the ECB. The ECB is likely to raise rates by 50 basis points and send a clear message. The consensus is for a 50 basis point hike from the BoE, although economists are divided on the scale of the move amid an economic slowdown.
Therefore, the week will be very active on Wall Street, of course, the Fed meeting, but also a lot of statistics, as well as the results of several big tech names on the stock market. On Monday, the Dallas Fed’s regional manufacturing index for January 2023 was -8.4, certainly negative and therefore in contraction territory, but above the FactSet consensus of -10. A month ago, the indicator was -20 (corrected data).
Tomorrow Tuesday, the value of the employment index, the S&P Case-Shiller index of home prices and the FHFA indicator, the Chicago manufacturing PMI, as well as the Conference Board’s consumer confidence index will be in the news – also at the Fed’s monetary meeting. begins.
On Wednesday, traders will watch the ADP Private Employment Report, Final Manufacturing PMI, ISM Manufacturing, Construction Spending, JOLTS Job Openings Report, Weekly US Domestic Oil Inventories Report and of course Jerome Powell’s press conference after the Fed’s monetary statement .
On Thursday, markets will follow the Challenger survey on jobless announcements, jobless claims, quarterly non-farm productivity and unit wage data, as well as industrial orders. Finally, the week will end on a high note on Friday with the monthly report on the US employment situation, the final PMI index and the ISM for American services.
As for the quarterly publications of the companies, NXP Semiconductors, GE Healthcare, ball, Core Financial Group and Vortex, discloses its accounts today. tomorrow is tuesday ExxonMobil, Pfizer, McDonald’s, UPS, Caterpillar, Amgen, AMD, Chubb, striker, Mondelez, Marathon Petroleum, General Motors, Sysco, Electronic Arts, Spotify, Snap, International document, Western Digital, Match group or Moody’sthey will reveal their numbers.
wednesday, Meta platforms (formerly Facebook), Thermo Fisher Scientific, T-Mobile USA, Altria, Boston Scientific, Humana, Waste management, Metlife, McKesson, Johnson Controls, Allstate Where AmerisourceBergenwill follow.
Thursday will be particularly enlivened by the accounts of the dayapple, Alphabet and Amazon after retirement! Eli Lilly, Merck, Conoco Phillips, Gene Digital, Bristol-Myers Squibb, Qualcomm, Honeywell, Starbucks, Gilead Sciences, Estee Lauder, Becton, Dickinson, Air Products and Chemicals, The Illinois tool works, Intercontinental exchange, Ford Motor, Ferrari, Sirius-XM, The one who knows, Parker-Hannifin, Clorox, Cardinal Health, NewsCorp, Stanley Black & Decker, Harley Davidson Where Ralph Laurenalso announce on wednesday.
GE Healthcare (+4%) reported an 8% year-over-year revenue increase to $4.9 billion for the fiscal fourth quarter, with organic growth of 13%. Quarterly net income fell to $554 million from $564 million a year ago. Adjusted Ebit came to $844 million versus $827 million a year ago. Adjusted earnings per share were $1.31, compared to $1.36 in the same period last year. Free cash flow more than doubled year-over-year to $987 million. GE HealthCare is reaffirming its 2023 guidance published earlier this month, with organic growth of 15 to 15.5% expected for an adjusted Ebit margin of 5 to 7%. Adjusted EPS is expected to be between $3.6 and $3.75 in 2022, compared to $3.38 in 2022.
SoFi Technologies Wall Street rallied on Monday after the digital financial services company posted an upbeat full-year financial forecast (+16%!). Total deposits at SoFi Bank increased 46% sequentially. For the first quarter, SoFi expects Adjusted Ebitda of $40-45 million, and for the full year, the company expects $260-280 million. Fourth-quarter GAAP revenue rose 60% to $457 million, as full-year 2022 revenue rose 58% to $443 million. Fourth quarter adjusted EBITDA increased 15 times year-over-year to a record $70 million. The fourth quarter’s GAAP net loss of $40 million improved 64% from a year ago. New member additions in the fourth quarter were approximately 480,000.
Ali Baba (-5%), Nio (-6%), Known (-10%), Pinduo-duo (-7%) and other Chinese stocks listed on Wall Street are under pressure on Monday. Mike McCaul, the new chairman of the US House Foreign Affairs Committee, showed yesterday that the risks of conflict between China and Taiwan are indeed very high.
Goldman Sachs (+1%) may leave Russia entirely after restructuring its assets there, according to Reuters, citing two well-informed sources.
Amazon According to Bloomberg, it will end free shipping on grocery orders under $150 in the U.S. (-3%) starting February 28. In an email, Amazon tells Prime members that Amazon Fresh shipping costs will be $9.95 for orders under $50, $6.95 for orders between $50 and $100, and $3.95 for orders between $100 and $150.