Asian Stocks Set to Advance as US Inflation Cools: Markets Wrap
Asian equity-index futures were buoyed by gains in stocks and bonds on Wall Street as further signs of cooling US inflation prepared investors for Federal Reserve rate cuts.
Contracts for Japanese, Australian and Hong Kong benchmarks climbed early Friday in a sign of robust risk sentiment. The S&P 500 advanced 0.4% Thursday, placing the benchmark within striking distance of its peak and also on pace for its third weekly gain, a run not seen since December. Futures for US equities edged lower in early Asian trading.
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China-to-US Freight Rates ‘No Longer Surging'—Is it All Downhill from Here?
After a series of weeks which saw trans-Pacific container prices double in the wake of a tariff truce between the U.S. and China, ocean freight rates may have already hit their summer seasonal peak. According to Hong Kong-based container shipping researcfh firm Linerlytica, rates have peaked after ocean carriers rolled back general rate increases (GRIs) from the previous two weeks as trans-Pacific capacity injections have still exceeded market demand. More from Sourcing Journal As Houthis Warn of 'War' Amid Israel-Iran Tensions, Red Sea Shipping Still Stagnant Trump Likely to Extend Tariff Pause as Negotiations Take Shape, Treasury Secretary Says Trump Touts Higher Duty Rate for Chinese Imports Under New Trade Deal A weekly update on Monday indicated that carriers are 'struggling to fill the ships' on the pathway to Los Angeles-Long Beach. Drewry's World Container Index (WCI), which saw ocean freight rates skyrocket 117 percent on the trans-Pacific trade lane in the four-week span prior to June 5, experienced a paltry 1 percent weekly jump to $5,914 per 40-foot container. The Shanghai-to-New York route had a major stabilization as well, shooting up 96 percent in a four-week span before inching up 2 percent to $7,285 per container. Overall, week-over-week totals across the WCI remained stable at $3,543 per 40-foot container. 'Global container shipping has addressed short-term capacity shortages and spot rates are now no longer surging, which will come as a relief to shippers,' said Philip Damas, head of Drewry Supply Chain Advisors. As carriers resumed suspended services and new carriers entered the market, Asia-to-West Coast ship capacity rose 16 percent month over month in June and is expected to increase another 8 percent in July, 'with far fewer cancelled sailings than in April/May,' Damas told Sourcing Journal. However, while GRI hikes are a lever ocean carriers often pull to capitalize on a surge in cargo and increase freight rates, the increased capacity forced them to pull back a week after taking effect. 'The June 1 GRI was fully implemented but failed to hold,' said Hua Joo Tan, co-founder of Linerlytica. 'Freight rates are dropping from their early June peak and will continue to fall back due to excess capacity as well as the absence of box shortages and port congestion. The mid-June GRI appears to be doomed for the same reasons.' According to a Thursday weekly update from Flexport, carriers have fully withdrawn planned June 15 GRIs for West Coast destinations. On the East and Gulf Coasts, GRIs remain in effect. Not everyone is anticipating such a quick fall, with Xeneta expecting an element of front-loading to still permeate throughout the original 90-day tariff rollback period. Xeneta's chief analyst, Peter Sand, said that 'mid-high' spot rates—rates paid by shippers in the 75th-highest percentile of the spot market—were the first batch that needed to get goods into the U.S. immediately and refill inventory. This cohort drove the sharpest rise in China-to-U.S. demand right after the rollback was announced May 12, he said. 'As we head into the second half of June, shippers benchmarking themselves against mid-low and average freight rates on the trans-Pacific headhaul will have to pay up as well,' Sand told Sourcing Journal. 'Still a tight market, but not tightening further to lift mid-high, as carriers are busy and soon done with bringing capacity back to the trans-Pacific trade lanes.' Adding onto the uncertainty is the U.S.-China tariff situation itself, which is still up in the air despite the Trump administration's insistence that there will be no more changes. Although representatives from the U.S. and China came to a new trade deal on Wednesday that establishes a combined duty rate of 55 percent on imports from China, there have been scant details surrounding the agreement. Additionally, neither Presidents Donald Trump nor Xi Jinping have officially approved the deal. 'There are still a lot of moving parts on the tariff front and this is unlikely to be the end as far as China tariffs are concerned,' Tan told Sourcing Journal. 'The cargo volume trajectory will also depend on the rest of tariff discussions that are yet to be finalized.' This refers to the other 90-day deadline for U.S. trade partners that were recipients of the reciprocal tariffs. Treasury Secretary Scott Bessent said Wednesday it is 'highly likely' the July 9 deadline would be extended. But with these de-escalations occurring, rates are likely to go on a downward slope if demand for carrier space weakens. 'Looking ahead, the end of the 90-day tariff pause and the probable early end of the peak season are expected to cause another downcycle in demand, another need for ship capacity changes and another sharp fall in spot freight rates from July,' said Damas. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Adobe Stock Slumps as Results Leave Some Waiting for More Signs of AI Success
Adobe shares slumped Friday, as the design software developer failed to impress with its quarterly results, despite topping Wall Street estimates. Several Wall Street analysts indicated Adobe's results didn't suggest enough progress with its own AI offerings to ease worries it could be held back by growing competition and AI disruption. Deutsche Bank said it expects the stock 'to remain range-bound until the company demonstrates more tangible success from AI."Adobe (ADBE) shares slumped Friday, as the design software developer failed to impress with its quarterly results, despite topping Wall Street estimates and boosting its full-year outlook. The stock led S&P 500 decliners by sinking nearly 6% in recent trading to roughly $390, leaving shares down 12% for 2025. "The key investor question remains when (if) AI innovation can move the needle," wrote Morgan Stanley analysts, who added the quarter "brought little to quell the bear concern around AI contribution being unable to reaccelerate growth while bulls must remain patient for encouraging AI metrics to move the needle." Still, the analysts said they are "overweight" on the stock with a $510 target, expecting Adobe AI monetization to ramp up in the next fiscal year. Jefferies analysts, who reiterated a "buy" rating and $590 price target on Adobe's potential growth driven by its AI offerings, echoed the comments, writing that while the firm's earnings showed some AI progress, it was "maybe not enough to appease bears." Jefferies also noted that Adobe's forecast, while higher, would imply a slowdown in growth in the fiscal fourth quarter, though they added they believe it "reflects management's conservatism amid ongoing macro uncertainties." Bank of America, which raised its target to $475 from $424 on Adobe's outlook and AI growth potential, said the company demonstrated "solid execution in a weaker software backdrop," calling it a "break from this reporting season, with most software companies opting not to flow through upside to the full year." Citi analysts, however, were less convinced, citing worries growing competition and AI disruption could hold Adobe back. Citi issued a "neutral" rating for the stock and $465 target. Deutsche Bank analysts, who affirmed their "hold" rating and $475 target, said they "expect the stock to remain range-bound until the company demonstrates more tangible success from AI." Read the original article on Investopedia Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Hims & Hers Health, Inc. (HIMS) Is a Trending Stock: Facts to Know Before Betting on It
Hims & Hers Health, Inc. (HIMS) has been one of the most searched-for stocks on lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term. Over the past month, shares of this company have returned -2.4%, compared to the Zacks S&P 500 composite's +3.6% change. During this period, the Zacks Medical Info Systems industry, which Hims & Hers Health falls in, has gained 10.1%. The key question now is: What could be the stock's future direction? Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision. Here at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock. We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. For the current quarter, Hims & Hers Health is expected to post earnings of $0.17 per share, indicating a change of +183.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.7% over the last 30 days. For the current fiscal year, the consensus earnings estimate of $0.73 points to a change of +170.4%. from the prior year. Over the last 30 days, this estimate has changed +0.6%. For the next fiscal year, the consensus earnings estimate of $1.04 indicates a change of +42.4% from what Hims & Hers Health is expected to report a year ago. Over the past month, the estimate has changed -0.6%. With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Hims & Hers Health. The chart below shows the evolution of the company's forward 12-month consensus EPS estimate: While earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth. In the case of Hims & Hers Health, the consensus sales estimate of $551.84 million for the current quarter points to a year-over-year change of +74.8%. The $2.34 billion and $2.9 billion estimates for the current and next fiscal years indicate changes of +58.5% and +23.8%, respectively. Hims & Hers Health reported revenues of $586.01 million in the last reported quarter, representing a year-over-year change of +110.7%. EPS of $0.2 for the same period compares with $0.05 a year ago. Compared to the Zacks Consensus Estimate of $538.09 million, the reported revenues represent a surprise of +8.9%. The EPS surprise was +66.67%. Over the last four quarters, Hims & Hers Health surpassed consensus EPS estimates two times. The company topped consensus revenue estimates each time over this period. Without considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects. Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is. The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued. Hims & Hers Health is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade. The facts discussed here and much other information on might help determine whether or not it's worthwhile paying attention to the market buzz about Hims & Hers Health. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Hims & Hers Health, Inc. (HIMS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
