Technology pushes Wall Street lower as the weekend approaches

(ABM FN-Dow Jones) US stock markets ended mainly lower on Friday. The Standard & Poor's 500 index fell 0.9 percent to 4,967.23 points, and the Nasdaq closed down 2.1 percent at 15,282.01 points. The Dow Jones index rose 0.6 percent to 37,986.40 points.

Bank of America analysts said the rally since October last year had left the stock market “perfectly priced,” meaning any setback could trigger a price reaction.

On a weekly basis, the S&P and Nasdaq indices lost between 3 and 5.5 percent. Sentiment declined due to concerns about interest rates and the tense situation in the Middle East.

Israel carried out a missile attack on Iran last night in response to the Iranian attack last weekend. Initially, oil prices rose sharply, as did the price of gold, and Wall Street futures fell. Bonds were in demand and therefore interest rates fell.

“The fact that safe havens (gold, Treasuries and the dollar) have already retreated from their peak early Friday morning suggests that markets believe this is the end. I would say wait for the official response from Tehran,” Franken Franken said. Edmond de Rothschild Bank.

Meanwhile, expectations of interest rate cuts have fallen significantly, according to investment expert Justin Bleekemolen of online broker Lynx, “with economists now believing the Fed will not cut rates until September or perhaps not at all this year.” Discounts are also increasing, Bleekemolen said. “Inflation recovery.”

Higher oil prices increase costs for consumers and can lead to increased inflation more broadly. Any escalation could affect the timing of future Fed rate cuts.

Next week the US earnings season will continue at full speed, with “4 of the 7 hot stocks reporting with Tesla, Alphabet, Microsoft and Meta. That's when things get really interesting,” says Franken.

The euro/dollar was trading at 1.0652 on Friday evening. Oil prices rose slightly, as did the price of gold. On a weekly basis, oil prices fell by about 3 percent.

Company news

Super Micro Computer shares came under heavy pressure on Friday, falling more than 23 percent. The manufacturer of chips used in artificial intelligence, among other things, decided not to provide interim figures before the final quarterly results at the end of April. Since there is no preliminary update now, investors fear that the results will not be very strong and at most in line with expectations or even worse.

Tech had a rough day anyway on Friday. Shares of Micron, Advanced Micro Devices and Nvidia fell about 5 to 10 percent.

Tesla lost nearly 2 percent. The electric vehicle manufacturer is recalling 3,878 Cybertrucks to repair or replace faulty throttle pedals

Netflix closed down more than 9 percent. The streaming company managed to beat expectations last quarter, but the outlook is still disappointing for investors. Netflix added 9.3 million new subscribers in the first quarter, while the market expected an increase of 5.1 million customers.

Procter & Gamble has increased its forecasts for the current fiscal year. According to P&G, adjusted earnings per share will rise by 10 to 11 percent this year compared to the previous 8 to 9 percent on an annual basis. Last quarter, turnover increased slightly and was slightly below expectations at $20.2 billion. Adjusted earnings per share of $1.52 were better than expected. The share rose by half a percent.

American Express generated more sales in the first quarter and saw a stronger profit increase. This emerged from the credit card company's quarterly numbers on Friday. Expectations were maintained. The stock rose more than 6%, keeping the Dow Jones Index in the green zone. The Dow Jones UnitedHealth heavyweight index closed up 1.6 percent.

Schlumberger saw sales and results increase in the first quarter. It has therefore met expectations and wants to return $7 billion to shareholders in the next two years. This was clearly evident from the results of the American oil service provider on Friday. The stock lost more than 2 percent.

PPG Industries posted higher earnings in the first quarter of 2024 as input costs fell, but revenue declined due to lower volumes in both its high-performance coatings and industrial coatings businesses. The stock fell more than 3 percent.

Paramount Global shares rose more than 13 percent after the New York Times reported that Sony's movie studio division was in talks with Apollo Global management about a bid to buy Paramount.

Source: ABM Financial News

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