Major indexes rise despite mixed earnings results

The Dow Jones Industrial Average rose on Friday, notching its best month since January.

The blue-chip index closed 272 points, or 0.8 per cent, higher at 34,098.16. The S&P 500 added 0.83 per cent to finish at 4,169.48. The Nasdaq Composite advanced 0.69 per cent to end at 12,226.58 as investors parsed the latest crop of technology earnings.

The Dow finished April 2.5 per cent higher, its best monthly showing since January, when the average ended up 2.8 per cent. The S&P 500 logged a 1.5 per cent monthly gain — its second positive month in a row — while the Nasdaq ended the month only slightly higher.

Just over half of S&P 500 companies have reported earnings thus far. Of those companies, 80 per cent have beaten expectations, according to data from FactSet.

Amazon shares closed down nearly 4 per cent. When reporting first-quarter results, the online retailer said its cloud business decelerated, though it did beat Wall Street’s expectations for revenue in the quarter.

Snap tumbled 17 per cent following a revenue miss. Pinterest shares dropped 15.7 per cent after issuing disappointing second-quarter revenue growth expectations. First Solar slid more than 9 per cent after missing Wall Street expectations for the first quarter.

Not every tech stock was down following their respective releases. Intel shares climbed 4 per cent after the semiconductor firm beat estimates on the top and bottom lines.

Data released Friday morning showed the personal consumption expenditures price index rose 0.3 per cent in March, which was in line with economist expectations. The index is a key gauge of inflation for the Federal Reserve, which has a policy meeting scheduled for next week.

Also of note, shares of troubled First Republic Bank plunged more than 43 per cent after CNBC’s David Faber reported that the most likely outcome for the regional bank is the Federal Deposit Insurance Corporation taking receivership. The stock has lost more than 97 per cent of its value since the start of the year.

Looking ahead, the US Federal Reserve is expected to raise rates for a tenth – and possibly final – time this week, with many analysts predicting a 25 basis point increase despite growing signs that the American economy is slowing down.

The US and the EU’s critical minerals agreement is expected to provide a wider range of benefits by removing trade barriers from Joe Biden’s Inflation Reduction Act. The agreement includes cobalt, graphite, lithium, manganese and nickel and will act as a free-trade agreement, making electric vehicles containing EU-extracted critical minerals eligible for subsidies.

The price of iron ore has come under pressure this week, as weak demand in China, caused by a subdued peak construction season and a focus on completing existing projects, rather than new ones, has caused the price to fall.

On Friday, the S&P500 sectors closed mostly higher. Energy was the standout, whilst Utilities lagged behind.

Futures

The SPI futures are pointing to a 0.7 per cent gain.

Currency

One Australian dollar at 8:00 AM is buying 66.11 US cents.

Commodities

Iron ore futures are pointing to a 0.9 per cent fall.

Gold was flat. Silver added 0.07 per cent. Copper gained 0.17 per cent and oil rose 2.7 per cent.

Figures around the globe

Across the Atlantic, European markets closed higher. London’s FTSE added 0.5 per cent, Frankfurt gained 0.8 per cent while Paris closed 0.1 per cent higher.

In Asian markets, Tokyo’s Nikkei gained 1.4 per cent, Hong Kong’s Hang Seng added 0.3 per cent and China’s Shanghai Composite closed 1.1 per cent higher.

On Friday, the Australian sharemarket closed 0.22 per cent higher at 7309.

Ex-dividends

Healthco Healthcare and Wellness REIT (ASX:HCW) is paying 1.875 cents unfranked

Dividends payable

Harvey Norman Holdings (ASX:HVN)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

Disclaimer

The views, opinions or recommendations of the commentators in this presentation are solely those of the author and do not in any way reflect the views, opinions, recommendations, of Sequoia Financial Group Limited ABN 90 091 744 884 and its related bodies corporate (“SEQ”). SEQ makes no representation or warranty with respect to the accuracy, completeness or currency of the content. Any prices published are accurate subject to the time of filming and shouldn’t be relied upon to make a financial decision. Commentators may hold positions in stocks mentioned and companies may pay FNN to produce the content at times. The content is for educational purposes only and does not constitute financial advice. Independent advice should be obtained from an Australian Financial Services Licensee before making investment decisions. To the extent permitted by law, SEQ excludes all liability for any loss or damage arising in any way including by way of negligence.
Copyright 2023 – Finance News Network