Tag: Stock market

Asia stocks set to fall as Meta drags on big tech

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian equity markets dropped after Meta Platforms Inc.’s disappointing outlook raised concern on whether the industry that has powered the bull market in equities has run too far.

Equity benchmarks dropped in Japan and South Korea, while futures for Hong Kong also declined. Australian financial markets are shut for a holiday. The yen traded in a narrow range after weakening beyond 155 per dollar for the first time in more than three decades on Wednesday, heightening the chances of intervention.

A $250 billion exchange-traded fund tracking the Nasdaq 100 got hit after the close of regular US trading as the Facebook parent tumbled more than 15%. Meta projected second-quarter sales that were below analyst expectations and increased its spending estimates for the year.

“Meta’s resources are vast, but not infinite,” said Sophie Lund-Yates, an analyst at Hargreaves Lansdown Plc. “The language around spending plans has become bolder once more, and this could be what’s spooking markets.”

In the run-up to the results, the S&P 500 struggled to gain traction, hovering near 5,070 as traders positioned for economic data that will help shape the views on the Federal Reserve’s next steps. Treasuries opened little changed in Asia after yields rose on Wednesday.

In Japan, the yen depreciated to as low as 155.37 per dollar on Wednesday, marking the first time since June 1990 the currency had crossed the 155 level. Traders will be alert to any comments from officials in Tokyo on Thursday that suggest a higher state of readiness for intervention.

Japan’s weak currency is a “big problem,” Japan Airlines Co. Chief Executive Officer Mitsuko Tottori said in a group interview, adding that a stronger rate than the current level of around ¥155 to the dollar would be better.

South Korea’s SK Hynix Inc. said it expects a full recovery in the memory market after AI demand spurred the chipmaker to log its fastest pace of revenue expansion since at least 2010.

Elsewhere, oil held a modest decline, with a risk-off tone in broader markets countering a drawdown in US stockpiles. Gold was little changed.

Earnings Unfolding

The Facebook parent reported revenue of $36.5 billion in the first quarter, an increase of more than 27% over the same period a year ago. It was a small beat, as analysts were looking for revenue of $36.1 billion on average, according to estimates compiled by Bloomberg. Profit more than doubled to $12.4 billion.

“We encourage investors to focus on the positives,” said Tejas Dessai at Global X ETFs. “The company’s fundamentals continue to show strength, and that’s the key story.”

To Mark Hackett at Nationwide, while the cohort of seven tech megacaps has done well in the last two years because of their superior earnings growth relative to the broader market, this advantage could decrease in 2024 and even more significantly in 2025.

“The ‘Magnificent Seven’ are not nearly as powerful as they once were,” Hackett said. “We see this as a positive development for investors looking to diversify away from the recent market leaders.”

For weeks, traders have been scaling back how many rate cuts they expect from the Fed amid a string of resilient economic data. Economists surveyed by Bloomberg predict gross domestic product likely cooled to around 2.5% in the first quarter, with the figures still potentially suggesting persistent inflationary pressures.

“Tomorrow’s pivotal GDP report comes as market participants hope for a soft number that would lead to rate cuts sooner rather than later,” said Jose Torres at Interactive Brokers. “We expect a stronger-than-projected figure. It would be great for revenue growth prospects, but bad for the timing and extent of rate cuts.”

Also Read: Trade Setup for April 25: Nifty looks to end April expiry on a high, but HUL, Kotak Bank may weigh

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Stock Market Highlights | Sensex, Nifty 50 gain for fifth day in a row, longest gaining streak in two months

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stock Market Highlights | Sensex, Nifty 50 showed resilience and rebounded from early losses to close near the day’s high, continuing the winning streak for the fifth consecutive session. This marks the longest winning streak in two months.

The benchmark Sensex rose 487 points to reach 74,339, while the broader Nifty climbed 168 points to 22,570. The banking sector led the rally with the Nifty Bank gaining 306 points to 48,495. Most major banks ended the day in the green. Axis Bank gained 6% on the back of robust Q4 results. However, Kotak Bank stood as the only major bank to end in the red.

Multi Commodity Exchange (MCX) rose 8% amid reports of the company’s plans to introduce new products. Bharat Forage ended 7% higher following a positive brokerage note. Vodafone Idea gained 6% after the listing of its Follow-on Public Offering (FPO). Nestle closed with a gain of nearly 3% as the company’s earnings surpassed estimates.

Dalmia Bharat, Indian Hotels, and Oracle Financial Services Software (OFSS) slipped by 3% on lower-than-expected Q4 results. Laurus Labs reported a beat on its topline but missed margin estimates, leading to a 2% fall.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

360 One Wam surges over 16% on strong growth in Q4 net profit, revenue

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of 360 One Wam Ltd, earlier known as IIFL Wealth Management, gained more than 16% on Wednesday, April 24, after the company reported a strong growth in net profit and revenue for the quarter ended March 2024.

In its earnings report for the quarter and financial year ended March 31, 2024, released on April 23, the wealth management and alternate assets focused company reported a 45.8% rise in revenue from operations in Q4FY24 to ₹573 crore compared to ₹393 crore in Q4FY23.

Sequentially revenue from operations increased 30.4% compared to ₹439 crore in the September quarter.

The financial services provider’s profit after tax (PAT) increased 55.55% YoY to ₹241 crore in March quarter against ₹155 crore in the year ago quarter. On a QoQ basis the company’s net profit increased 24.3% against ₹194 crore reported in the September quarter.

For the full financial year FY24, the company’s net profit stood at ₹802 crore, up 20% compared to ₹668 crore in the preceding financial year.

Its revenue from operations increased 17.9% YoY for financial year 2023-24 to ₹1,846 crore against ₹1,565 crore in the year-ago period.

Following the strong quarterly results shares of 360 One Wam opened higher and further rallied as much as 16.37% to an intraday high of ₹887.1 apiece on the BSE. However, the stock pared some early gains and traded 5.29% higher at ₹802.55 apiece on the BSE at 1:17 pm.

Commenting on the quarterly results, Karan Bhagat, MD and CEO of the company, said, “We are happy to report that the company recorded its highest ever annual profit in FY24. Looking forward, we are optimistic about the substantial wealth opportunity beyond Tier-1 cities and have an expansion plan for our domestic coverage.”

The company expects to leverage the strength of the core platform and innovative competences to fuel high growth in the HNI segment as well as to become a favoured wealth manager in India.

360 One Wam, formerly known as IIFL Wealth Management Limited, has more than $54.6 billion assets under management and it helps over 7,000 HNI and ultra-HNI families to manage, grow and preserve their wealth.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks rise as Tesla buoys US tech giants

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stocks in Asia advanced after a US rally in tech heavyweights, whose high-stakes earnings are considered by Wall Street investors a major test of the equities bull run.

Equity benchmarks rose in Japan and South Korea, while futures for Hong Kong pointed up. US futures gained in early Asian trading. In late US hours, Tesla Inc. soared as the electric-vehicle giant struck an upbeat tone despite a sales miss, the first of the “Magnificent Seven” megacaps to report. The stock halted a seven-day plunge, climbing alongside other members of the group.

Meanwhile, weakness in measures of business activity helped keep alive forecasts for US rate cuts this year, which was positive for equities but weighed on the dollar and Treasury yields.

After hitting several record highs this year, equities have lost traction in the past few weeks on signals the Federal Reserve will hold rates higher for longer. The slide made stocks more attractive as it removed market froth, with investors now focused on earnings, according to Citigroup Inc. strategists.

“We would view the recent pullback as a buying opportunity,” Citi’s Mihir Tirodkar and Beata Manthey said. “Bullish positioning has unwound and now looks more neutral, particularly in the US. The current earnings season could refocus investor attention on solid underlying fundamentals.”

The S&P 500 notched its best back-to-back rally in two months. Nvidia Corp., the poster child of the artificial-intelligence boom, led a surge in chipmakers. Texas Instruments Inc. gave a bullish revenue forecast — a good sign for the chip industry that may help lift Asian producers on Wednesday.

Treasuries were largely steady after briefly extending gains on a solid $69 billion sale of two-year notes — but quickly returned to levels seen ahead of the auction — with 10-year yields little changed.

Oil held a gain as an industry report showed shrinking US crude stockpiles and traders tracked progress toward fresh sanctions against Iran. Gold is little changed.

In Japan, the yen was steady within sight of reaching the psychological 155 level to the dollar, keeping traders on guard for potential intervention by authorities to prop up the currency.

Earnings on Watch

Morgan Stanley’s Mike Wilson said the bar is high for US firms to deliver on earnings, particularly for megacap technology names, which face tough comparisons from the growth they showed last year.

Besides Tesla, Microsoft Corp., Meta Platforms Inc. and Alphabet Inc. are also due to report earnings this week. Profits for the “Magnificent Seven” group — which also includes Apple Inc., Amazon.com Inc. and Nvidia Corp. — are forecast to rise about 40% in the first quarter from a year ago, according to Bloomberg Intelligence data.

The group of tech megacaps is crucial to the S&P 500 since the companies carry the heaviest weightings in the benchmark. After this year’s advance, valuations have gotten lofty. After the latest selloff, the Magnificent Seven still traded at a combined 31 times forward earnings, according to data compiled by Bloomberg.

Also Read: Trade Setup for April 24: Is the recent Nifty recovery set for a temporary pause?

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Stock Market Highlights | Market closes with gains for fourth straight session, Nifty holds 22,400

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stock Market Highlights |  Equity benchmark indices Sensex and Nifty continued their upward trajectory for the fourth consecutive session on Wednesday (April 24), bolstered by a surge in metal stocks and positive sentiments across sectors. The benchmark indices, Sensex and Nifty, notched up modest gains, with Nifty firmly holding above the 22,400 mark.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here’s how follow-on public offering is different from an initial public offering

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Initial Public Offerings (IPOs) and Follow-on Public Offerings (FPOs) are two common methods for companies to raise capital through the stock market. While both involve offering shares to the public, they have distinct differences.

An Initial Public Offering (IPO) is the process by which a private company offers shares of its stock to the public for the first time. This transition from private to public status allows the company to raise capital by selling ownership stakes to investors.

On the other hand, a Follow-on Public Offering (FPO), also known as a Secondary Offering, occurs when a company that is already public issues new shares to the public. This allows the company to raise additional capital without the need for an IPO.

The main difference between an IPO and an FPO lies in their purpose. An IPO marks the initial public offering of a private company’s stock, while an FPO involves a public company issuing additional shares to raise more capital. Both IPOs and FPOs require companies to file registration statements with the SEC. However, the level of scrutiny and disclosure may be higher for IPOs since they involve transitioning from private to public status.

Also Read: Vodafone Idea shares surge over 14% after strong FPO subscription; Here’s what it means

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Stock Market Highlights | Sensex, Nifty 50 gains for third straight session, volatility index slides 20%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stock Market Highlights | Indian benchmark indices Nifty 50 and Sensex continued the upward momentum for the third consecutive session, though closed off intraday highs. The Volatility Index experienced a significant 20% slide, marking its largest single-day fall since May 2019. The Sensex climbed 90 points to 73,738, while the Nifty rose 32 points to 22,368. Nifty Bank gained 46 points to 47,970, and the Midcap Index surged by 518 points to 49,615.

Catch highlights here

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks track US rebound on profit optimism

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian stocks rose after US shares rebounded from a $2 trillion selloff on optimism big tech leaders will announce hefty profits this week.

Benchmark indexes advanced in Japan and South Korea, while futures in Hong Kong also pointed to gains. Contracts for US equities were little changed after the S&P 500 topped 5,000 — halting a six-day rout — while the Nasdaq 100 rose 1%, with Nvidia Corp. leading gains in big tech. Apple Inc. was named a top pick for 2024 at Bank of America Corp. on optimism over its upcoming results.

Investors are waiting to see if earnings will meet the lofty expectations for artificial intelligence this week when about 180 companies in the S&P 500 — representing over 40% of the gauge’s market capitalization — are due to report their results. Stakes are high for the “Magnificent Seven” megacaps, whose profits are forecast to rise nearly 40% from a year ago, according to Bloomberg Intelligence. The focus on earnings comes after a rout fueled by geopolitical fears and signals the Federal Reserve will be in no rush to cut rates.

“Concerns about rising interest rates, stubborn inflation, and geopolitical risks aren’t going anywhere — but this week, the tech sector may be ‘calling the shots’,” said Chris Larkin at E*Trade from Morgan Stanley.

Treasuries were flat in Asia ahead of a flurry of bond auctions that will test investors’ appetite after yields hit the highest in 2024. Australian bonds gained in early trading.

Oil held a modest decline as investors were encouraged after Middle East tensions eased. Gold edged higher after tumbling 2.7% on Monday as haven demand waned.

In Asia, focus returns to China’s role as a major lender to developing nations amid a report the head of its central bank wants creditors engaged in debt restructurings to agree on how to fairly share the burden of relief.

Elsewhere, the yen traded near 34-year low versus the dollar, keeping alive speculation Japanese authorities will step up verbal intervention or take action to support its beleaguered currency.

Strategists at Wall Street’s top banks are split on whether companies can deliver on robust forecasts. While Morgan Stanley’s Michael Wilson said he expects profit growth to improve as the economy strengthens, his counterpart at JPMorgan Chase & Co., Mislav Matejka, argues that hot inflation, a stronger dollar and geopolitical tensions are clouding the outlook.

Nearly two-thirds of 409 respondents in Bloomberg’s Markets Live Pulse survey said they expect earnings to give the US equity benchmark a boost. That’s the highest vote of confidence for profits since the poll began asking the question in October 2022.

The challenge to S&P 500 returns this earnings season is that companies will have to produce earnings — and outlooks — that support the already elevated multiples, according to Megan Horneman at Verdence Capital Advisors.

Indeed, the stakes are high for America’s technology behemoths to start delivering on artificial intelligence promises with their earnings poised to decelerate, according to Bank of America Corp. strategists.

Microsoft Corp., Alphabet Inc., Meta Platforms Inc. and Tesla Inc. report results this week — kicking off earnings for the so-called Magnificent Seven. With AI seen as the key to future profits, its contributions to the earnings mix is a focus for traders, a BofA team including Ohsung Kwon and Savita Subramanian said.

Also Read: Trade Setup for April 23: Reliance Industries to determine Nifty trajectory after 600-point recovery

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Stock Market Highlights | Sensex, Nifty 50 rise 1% each, close at one-week high

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Stock Market Highlights | Indian benchmark indices Nifty 50 and Sensex extended gains from Friday, closing at a one-week high today. Both frontline indices, Sensex and Nifty, rose by 1% each, with all sectoral indices ending in the green. Reliance, along with ICICI Bank, Axis Bank, and L&T, lifted Nifty, while HDFC Bank dragged it down. Sensex surged by 560 points to reach 73,649, and Nifty climbed 189 points to settle at 22,336. Nifty Bank gained 351 points to reach 47,925, and the Midcap Index rose by 400 points to 49,096.

Catch highlights here

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks rebound with earnings, data in focus

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Asian stocks opened higher as focus shifted to a slew of company earnings and economic data this week for insight into the direction of central bank policy.

Benchmarks in Japan, Australia and South Korea all rose more than 1% early Monday, partially recovering after last week’s slump. The dollar was slightly weaker as traders took some comfort in the absence of further escalation from Iran following Israel’s retaliatory strike.

The rebound comes after traders last week were whipsawed by Middle East tensions as well as hawkish comments from Federal Reserve officials indicating reluctance to cut rates anytime soon. US growth and Fed’s preferred measure of inflation are due this week, which will help finesse bets on timing of rate cuts. Investors must also absorb a hefty slate of Treasuries auctions.

Also in focus in the region for Monday is China’s loan prime rates.

The Fed has entered its media blackout period and “the market often softens its Fed expectations during this quiet period,” said Win Thin, global head of markets strategy at Brown Brothers Harriman in New York. “However, the Fed has been sending a consistently hawkish message in recent weeks and markets would do well not to forget that.”

The S&P 500 saw its worst week since March 2023 last week — extending a drawdown from its all-time high to more than 5%. After the gauge’s strongest start to a year since 2019, investors have been increasingly skeptical about how much further the market could go over the near term, even accounting for the continued strength in the economy.

More than half of the “Magnificent Seven” cohort of tech megacaps will report earnings this week — leaving investors wondering whether those firms are going to live up to the high expectations set for artificial intelligence. Profits for the seven biggest growth companies in the S&P 500 — Apple Inc., Microsoft Corp., Alphabet Inc., Amazon.com Inc., Nvidia, Meta Platforms Inc. and Tesla Inc. — are on course to surge 38% in the first quarter, according to Bloomberg Intelligence. When excluding them, the rest of the benchmark index’s profits are anticipated to shrink by 3.9%.

Meantime, conflicts in the Middle East and Ukraine continue to simmer. Ukrainian authorities were jubilant at the approval in the US House of more than $60 billion in aid, with President Volodymyr Zelenskiy vowing the funds will help retake the initiative in its fight against Russia’s invasion.

The limited Israeli strike on Iran and the muted response from the Iranian leadership potentially provide an opportunity for the conflict between the long-term adversaries to scale back, for now, according to RBC Capital Markets.

“It is far from an easy truce and could be tested once again as the broader Middle East backdrop remains fraught, even if the worst outcome did not come to pass,” Helima Croft, head of global commodity strategy at RBC, wrote in a note to clients. “The last two weeks have shown that this war can take sudden escalatory turns and that opposing sides may lack a cogent understanding of the other’s red lines, thereby risking a fog of war dynamic.”

Oil fell after its first back-to-back weekly decline this year as traders weighed the potential next steps from Iran and Israel. Gold slipped.

Elsewhere this week, inflation readings in Australia and Malaysia are due. Bank Indonesia will give a policy decision just as the currency comes under pressure, while earnings at global growth bellwether Caterpillar are due.

Also Read: Trade Setup for April 22: Nifty looks to sustain Friday’s recovery amidst tech sell-off, RIL results

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow