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CNA
5 days ago
- Business
- CNA
Wall Street edges higher, dollar bounces back amid tariff talks, economic data
NEW YORK :Wall Street edged higher and the dollar rebounded on Tuesday as market participants looked past ongoing tariff wrangling and lowered economic expectations ahead of Friday's crucial U.S. employment report. All three major U.S. stock indexes were up modestly while gold backed down from a near four-week high in opposition to the strengthening greenback. "Today is a day with no big drivers," said Tim Ghriskey, senior portfolio strategist Ingalls & Snyder in New York. "The market is becoming more comfortable with Trump's negotiation style. He comes out with guns blazing and then is, you know, very happy to, you know, put his guns away, having made his point. "He expects a reasonable settlement at least, which he'll call a huge win, of course," Ghriskey added. "But in reality he's not looking to punish our trading partners; he's looking for incremental adjustments to tariffs." The Organization for Economic Cooperation and Development (OECD) said the global economy is on course for a more drastic slowdown than it expected only a few months ago. It cited the fallout from Trump's trade war, and warned that growth will be even weaker as protectionism increases, fuelling inflation and disrupting supply chains. That sentiment was shared by the United Nations' International Labor Organization (ILO), which downgraded its global employment forecast due to worsening economic conditions arising from trade tensions. In economic data, a report from the U.S. Labor Department showed the number of unfilled U.S. jobs unexpectedly rose in April, while new orders for factory-made goods posted a steeper drop than analysts anticipated. Investors are now training their focus on the May employment report, expected on Friday. Economists polled by Reuters expect the U.S. economy added 130,000 jobs last month, with the unemployment rate standing pat at 4.2 per cent. The Dow Jones Industrial Average rose 30.12 points, or 0.07 per cent, to 42,334.83, the S&P 500 rose 12.36 points, or 0.21 per cent, to 5,948.30 and the Nasdaq Composite rose 100.78 points, or 0.52 per cent, to 19,343.39. European stocks were moderately lower as investors exercised caution while awaiting further developments in tariff negotiations, but pared losses in the wake of a report that Euro Zone inflation has eased below the European Central Bank's (ECB) target, paving the way for further policy easing. MSCI's gauge of stocks across the globe rose 0.37 points, or 0.04 per cent, to 883.25. The pan-European STOXX 600 index fell 0.13 per cent, while Europe's broad FTSEurofirst 300 index fell 1.85 points, or 0.09 per cent. Emerging market stocks rose 3.26 points, or 0.28 per cent, to 1,157.03. MSCI's broadest index of Asia-Pacific shares outside Japan closed higher by 0.37 per cent to 609.76, while Japan's Nikkei fell 23.86 points, or 0.06 per cent, to 37,446.81. The dollar bounced back from a six-week low, even as concerns persisted over potential economic damage in the wake of Trump's trade war. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.58 per cent to 99.15, with the euro down 0.49 per cent at $1.1386. Against the Japanese yen, the dollar strengthened 0.74 per cent to 143.75. Yields on 10-year U.S. Treasuries dipped but were off their lows in the wake of weaker than expected U.S. economic data. The yield on benchmark U.S. 10-year notes fell 2.2 basis points to 4.44 per cent, from 4.462 per cent late on Monday. The 30-year bond yield fell 3.3 basis points to 4.9614 per cent from 4.995 per cent late on Monday. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 0.8 basis points to 3.953 per cent, from 3.945 per cent late on Monday. Crude prices extended their gains, supported by roiling geopolitical concerns as the war in Ukraine intensified and Iran appeared poised to reject a U.S. nuclear deal proposal. U.S. crude rose 1.87 per cent to $63.69 a barrel and Brent rose to $65.68 per barrel, up 1.62 per cent on the day. Gold prices retreated from a near four-week high amid profit-taking and in opposition to the strengthening dollar.
CNA
29-05-2025
- Business
- CNA
Markets shrug off US appeals court's decision to reinstate Trump tariffs
NEW YORK :Wall Street closed higher on Thursday, largely shrugging off a decision by a federal appeals court late Thursday reinstating President Donald Trump's tariffs. This came a day after a trade court blocked most of the U.S. president's tariffs going into effect. The S&P 500 ended up 0.4 per cent higher on the day after the appeals court headline. The dollar, on the other hand, stayed lower against its safe-haven peers such as the yen and Swiss franc as investors braced for more trade uncertainty and volatility. It's "a secondary thing even, though it's capturing the headlines right now. Investors are looking forward. Trump has already rolled back most of these tariffs anyway, so these court rulings are just headlines. Trump probably prepared an appeal before the ruling even came out. As far as I'm concerned, as long as the market doesn't tank on the news, it's just a secondary byproduct." MARK SPINDEL, CHIEF INVESTMENT OFFICER, POTOMAC RIVER CAPITAL LLC, WASHINGTON "I think markets are just going to continue to be caught in this pinball machine of court decisions, executive orders and judicial reviews. This is what happens when you don't follow a more sticky legislative process when developing policy. The result of using executive orders is that you're at the mercy of a court that is ruling on, circumscribing, or endorsing those orders. Markets are caught in the middle of all this, and the result is chaos and uncertainty." TIM GHRISKEY, SENIOR PORTFOLIO STRATEGIST, INGALLS & SNYDER, NEW YORK, NEW YORK "The market has become numb to the tariff issue because the changes occur from multiple parties on a daily basis. Last night the U.S. Court of International Trade ruled the Trump doesn't have authority to implement reciprocal tariffs." "That ruling was appealed and the appeal was successful. Now we're back with Trump having authority. Every day there's new news. The time frames are short and there are a lot of countries currently in trade and tariff negotiations. Markets are waiting for an ultimate resolution, which will likely be somewhat favorable to the U.S. overall but they may not be successful everywhere." "Traders will react to news like this as quickly as they can hoping to gain a little advantage. But fortunes aren't made in the stock market by rapidly trading. They're made by investing in companies ... a daily move is just a drop in the bucket." "As we've seen, courts are ruling in opposite ways so its very, very hard to gain any advantage as a trader. And you have a President who makes totally opposite statements on successive days, either huge tariffs or the removal of tariffs." HELEN GIVEN, DIRECTOR OF TRADING, MONEX USA, WASHINGTON "FX markets have become increasingly headline-weary, and the developments over the last 24 hours are no exception. Traders have adopted an 'I'll believe it when I see it' approach to any announcements regarding tariffs, hence the very muted reaction from the U.S. dollar to the headline that Trump's tariffs are, for now, back on the table." "Importantly, the majority of the levies in question have already been paused and will continue to stay on hold until the early July end of Trump's 90-day pause, so traders are giving this court action until then to reach a conclusion and any reaction to further headlines is likely to continue to be smaller than some of the volatility we've seen since April 2nd, albeit in choppy trading."
Time of India
28-05-2025
- Business
- Time of India
Nvidia to have final say on strong earnings season for Big Tech
Nvidia Corp. faces the final test of an earnings season-driven rally that has sent its shares up more than 40% from an April low. The world's most valuable chipmaker reports Wednesday after market close — the last of the Big Tech cohort to do so. Results from Microsoft Corp., Meta Platforms Inc. and others showed that outlooks remain mostly intact despite uncertainty caused by President Donald Trump's shifting tariff plans. The reports, along with cooling trade tensions, have helped fuel a rebound in technology stocks that were at the heart of last month's S&P 500 rout. 'Tech results have generally been positive, and in some cases, exceptional,' said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. 'I think continued strength in Nvidia will support the overall tech trend.' Nvidia shares have soared as its biggest customers pledge to keep spending heavily on equipment for artificial intelligence computing and as new buyers emerge from governments in the Middle East. The stock remains down 9% from its January peak. The focus in the firm's first-quarter earnings report will be the supply of computer systems based on its new Blackwell chips, which faced manufacturing hiccups that hampered sales in the fourth quarter amid heavy demand. The Santa Clara, California-based company is projected to deliver around $19 billion in net income on revenue of $43 billion in the first quarter, up 31% and 66%, respectively, from the same period a year ago. Another thing investors will be watching closely is profit margins. In February, Nvidia said higher costs associated with the ramp up of Blackwell production would weigh on gross margins in the first quarter. Gross margins should return to the 'mid-70s' by the end of the year from a projection of roughly 71% in the first quarter, Chief Financial Officer Colette Kress said at the time. 'We did see a slowdown in margins last quarter and if we see them shrink again, that could bring the stock down,' said Andrew Rocco, a stock strategist at Zacks Investment Research. 'I don't think we'll see a huge surprise with this report one way or the other but there is a risk with the outlook.' The earnings report has the potential to be complicated owing to US export restrictions of advanced semiconductors to China aimed at slowing the country's technological progress. Last month, Nvidia wrote off about $5.5 billion in inventory of chips designed explicitly to comply with previous US curbs. Chief Executive Officer Jensen Huang has criticised the US policies, which he said will cede a market that could be worth $50 billion in 2026 to Chinese rivals. Wall Street estimates appear to vary widely on the impact of the restrictions, creating the potential for a 'messy' quarter, Morgan Stanley analysts led by Joseph Moore wrote in a research note published Tuesday. Nvidia and other technology giants were among the biggest decliners in last month's rout that sent the S&P 500 to the brink of a bear market. Many of the stocks have recouped much of the losses after Trump temporarily paused the stiffest levies and earnings showed demand remains intact. The Nasdaq 100 Index is outperforming the S&P 500 since the reporting cycle kicked off in mid-April. This earnings season has shown that the biggest buyers of AI computing gear plan to keep plowing money into capital spending, a boon for Nvidia and other makers of computing hardware. Microsoft and Alphabet pledged to spend even more next year, while Meta raised its forecast for capital expenditures in 2025. 'It is remarkable how much we've almost come full circle in a few weeks,' said Rob Almeida, global investment strategist at MFS Investment Management. 'The fact that hyperscalers still think they can't afford to not invest is a pretty strong signal for their intentions over the next four quarters.' Despite the rebound in Nvidia shares, the stock's valuation relative to anticipated earnings remains at a discount. Nvidia is priced at 29 times profits projected over the next 12 months, compared with a five-year average of 40, according to data compiled by Bloomberg. The Nasdaq 100 trades around 26 times projected profits. For Krishna Chintalapalli, a portfolio manager at Parnassus Investments, the attraction to Nvidia as the biggest beneficiary of AI spending remains strong. 'I haven't seen anything in the past three months that would suggest the story has dramatically changed,' Chintalapalli said. 'While China is a factor, the Middle East deals suggest broad-based demand for Nvidia chips beyond the US and China.'
Time of India
28-05-2025
- Business
- Time of India
Nvidia to have final say on strong earnings season for Big Tech
Nvidia Corp. faces the final test of an earnings season-driven rally that has sent its shares up more than 40% from an April low. The world's most valuable chipmaker reports Wednesday after market close — the last of the Big Tech cohort to do so. Results from Microsoft Corp., Meta Platforms Inc. and others showed that outlooks remain mostly intact despite uncertainty caused by President Donald Trump's shifting tariff plans. The reports, along with cooling trade tensions, have helped fuel a rebound in technology stocks that were at the heart of last month's S&P 500 rout. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Unbelievable: Calculator Shows The Value Of Your House Instantly (Take a Look) Home Value Calculator Learn More Undo 'Tech results have generally been positive, and in some cases, exceptional,' said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. 'I think continued strength in Nvidia will support the overall tech trend.' Bloomberg Live Events Nvidia shares have soared as its biggest customers pledge to keep spending heavily on equipment for artificial intelligence computing and as new buyers emerge from governments in the Middle East. The stock remains down 9% from its January peak. Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories The focus in the firm's first-quarter earnings report will be the supply of computer systems based on its new Blackwell chips, which faced manufacturing hiccups that hampered sales in the fourth quarter amid heavy demand. The Santa Clara, California-based company is projected to deliver around $19 billion in net income on revenue of $43 billion in the first quarter, up 31% and 66%, respectively, from the same period a year ago. Another thing investors will be watching closely is profit margins. In February, Nvidia said higher costs associated with the ramp up of Blackwell production would weigh on gross margins in the first quarter. Gross margins should return to the 'mid-70s' by the end of the year from a projection of roughly 71% in the first quarter, Chief Financial Officer Colette Kress said at the time. 'We did see a slowdown in margins last quarter and if we see them shrink again, that could bring the stock down,' said Andrew Rocco, a stock strategist at Zacks Investment Research. 'I don't think we'll see a huge surprise with this report one way or the other but there is a risk with the outlook.' The earnings report has the potential to be complicated owing to US export restrictions of advanced semiconductors to China aimed at slowing the country's technological progress. Last month, Nvidia wrote off about $5.5 billion in inventory of chips designed explicitly to comply with previous US curbs. Chief Executive Officer Jensen Huang has criticised the US policies, which he said will cede a market that could be worth $50 billion in 2026 to Chinese rivals. Wall Street estimates appear to vary widely on the impact of the restrictions, creating the potential for a 'messy' quarter, Morgan Stanley analysts led by Joseph Moore wrote in a research note published Tuesday. Nvidia and other technology giants were among the biggest decliners in last month's rout that sent the S&P 500 to the brink of a bear market. Many of the stocks have recouped much of the losses after Trump temporarily paused the stiffest levies and earnings showed demand remains intact. The Nasdaq 100 Index is outperforming the S&P 500 since the reporting cycle kicked off in mid-April. This earnings season has shown that the biggest buyers of AI computing gear plan to keep plowing money into capital spending, a boon for Nvidia and other makers of computing hardware. Microsoft and Alphabet pledged to spend even more next year, while Meta raised its forecast for capital expenditures in 2025. 'It is remarkable how much we've almost come full circle in a few weeks,' said Rob Almeida, global investment strategist at MFS Investment Management. 'The fact that hyperscalers still think they can't afford to not invest is a pretty strong signal for their intentions over the next four quarters.' Despite the rebound in Nvidia shares, the stock's valuation relative to anticipated earnings remains at a discount. Nvidia is priced at 29 times profits projected over the next 12 months, compared with a five-year average of 40, according to data compiled by Bloomberg. The Nasdaq 100 trades around 26 times projected profits. Bloomberg For Krishna Chintalapalli, a portfolio manager at Parnassus Investments, the attraction to Nvidia as the biggest beneficiary of AI spending remains strong. 'I haven't seen anything in the past three months that would suggest the story has dramatically changed,' Chintalapalli said. 'While China is a factor, the Middle East deals suggest broad-based demand for Nvidia chips beyond the US and China.'
Yahoo
13-03-2025
- Business
- Yahoo
Apple Shares Are Losing Haven Allure as Headwinds Deter Bulls
(Bloomberg) -- For years, investors have talked of Apple Inc. as a potential port of safety in times of market turmoil. That hasn't been borne out this time around. Trump DEI Purge Hits Affordable Housing Groups NYC Congestion Pricing Toll Gains Support Among City Residents Electric Construction Equipment Promises a Quiet Revolution Open Philanthropy Launches $120 Million Fund To Support YIMBY Reforms Prospect Medical's Pennsylvania Hospitals at Risk of Closure The iPhone maker has tumbled in recent sessions, extending its year-to-date underperformance amid a growing number of risks that are overshadowing its traditional high-quality characteristics. While Apple offers steady earnings growth and sits on a mountain of cash, headwinds form a daunting list for would-be bulls: it is heavily exposed to tariff uncertainty and China, its artificial intelligence offerings have repeatedly fizzled, and its lucrative partnership with Google parent Alphabet Inc. is potentially at risk. It trades at a premium to megacap tech peers despite slower revenue growth, suggesting that the haven case is harder to make for Apple and other big-tech names. 'People like to park in Apple, but right now the stock is expensive, and not only is growth slow, but the catalysts for growth are absent,' said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. 'It doesn't seem like AI is doing much for it, the environment is very uncertain, and it is very at risk with tariffs and China. While it isn't as controversial as Tesla, it seems like it is just treading water, and it has been a while since we've seen anything truly innovative from it.' Shares have dropped 14% this year, and are coming off their biggest three-day decline since November 2022, a selloff that took the stock to its lowest close since September. The stock fell an additional 0.8% on Thursday. The Nasdaq 100 Index is down 7% in 2025, and Apple is responsible for nearly a fifth of that decline, according to data compiled by Bloomberg. The CBOE Apple VIX, which tracks a market estimate of future volatility for the stock, has risen 56% off a February low. Recent volatility reflects rising geopolitical risk, especially with respect to tariffs. President Donald Trump recently doubled levies against China to 20%, a potentially significant development for Apple, which counts the country as both as a key manufacturing hub and a major market; it got about 17% of its fiscal 2024 revenue from the greater China region, according to data compiled by Bloomberg. Bloomberg Intelligence analyst Anurag Rana calculates that Apple faces a 100-150 basis point dent on operating margin and a 1-2% hit on sales growth if the surcharge carries on the full fiscal year. Investors are hoping Apple will get an exemption, as it did during Trump's first term, and it recently announced domestic spending plans that were seen as a way to curry favor. Avoiding tariffs might remove an overhang on the stock, but wouldn't represent much of a catalyst otherwise at a time when investors are anxious to see more robust growth. Revenue has fallen in five of the past nine quarters, and while analysts expect 4.7% growth in fiscal 2025, this is less than half the 11.8% pace expected for the overall tech sector, according to Bloomberg Intelligence. This is despite Apple trading at 28 times estimated earnings, well above its 10-year average, and a premium to every other Magnificent Seven stock except Tesla Inc. 'There's so much uncertainty from tariffs, and doubts that it can grow enough to overcome both risks like that and the valuation hurdle,' said Scott Yuschak, managing director of equity strategy at Truist Advisory Services. 'It isn't the stock I'll worry about first, since its balance sheet is stable and there are other pricey stocks where the businesses aren't as durable, but I do wrestle with it.' Yuschak is not alone. Fewer than two-thirds of the analysts tracked by Bloomberg recommend buying the stock, making Apple the least-loved Magnificent 7 stock outside Tesla. Investors had been optimistic that the iPhone 16, the first to be compatible with AI features, would entice consumers to trade up for the latest model. However, demand has underwhelmed so far, and in the latest example of its struggles with the cutting-edge technology, it is indefinitely delaying the release of its AI-infused Siri digital assistant. In a potential positive, however, Apple will use Alibaba's technology to bring AI features to Apple products in China. Last week, Alibaba said its latest AI model had performance that is comparable to DeepSeek's despite requiring a fraction of the data. Ed Cofrancesco, chief executive officer of International Assets Advisory, noted that Apple had avoided the kind of heavy AI spending of other big tech companies that is coming under increased scrutiny. 'This isn't your play if you're looking for a stock that will triple, but if the economy cools, it's likely to be a safe haven given the quality and stability of its earnings and balance sheet, and its decades of showing it can pivot in the face of changing conditions,' he said. 'There are a lot of land mines in the road ahead, and Apple is better situated to navigate them than other names in tech.' Tech Chart of the Day Intel Corp. shares jumped 14% on Thursday after the chipmaker named Lip-Bu Tan as its CEO. Tan is signaling that he'll stick with his predecessor Pat Gelsinger's plan to make chips for other companies, even as he vows to learn from past mistakes. Top Tech Stories Alibaba Group Holding Ltd. unveiled a new version of its AI assistant mobile app that incorporates its latest in-house model, another in a series of product rollouts intended to help the company keep pace with Chinese artificial intelligence rivals. Adobe Inc. gave a disappointing outlook for revenue growth in the current quarter despite a recent focus on monetizing its new generative artificial intelligence features. Alphabet Inc.'s Google is lobbying state lawmakers to reject legislation that would require app stores to broadly share user age information with app developers—language backed by Meta Platforms Inc.—in favor of its own proposal to protect children online. The US Federal Trade Commission is moving ahead with a sprawling antitrust probe of Microsoft Corp. that was opened in the waning days of the Biden Administration, signaling that Donald Trump's new FTC Chair Andrew Ferguson is going to prioritize scrutiny of tech giants. Earnings Due Thursday Earnings Postmarket: DocuSign Inc. (DOCU US) PagerDuty Inc. (PD US) Semtech Corp. (SMTC US) Turtle Beach Corp. (TBCH US) --With assistance from Subrat Patnaik. (Updates to market open.) How America Got Hooked on H Mart How Trump's 'No Tax on Tips' Could Backfire for the Working Class How Natural Gas Became America's Most Important Export Germany Is Suffering an Identity Crisis 80 Years in the Making Disney's Parks Chief Sees Fortnite as Key to Its Future ©2025 Bloomberg L.P.
