SIPA_ap22350558_000001.jpg

Tech stocks are showing strength, the European stock market is rising and so is Wall Street

The Paris stock market, like other European markets, is advancing this Wednesday, and Wall Street should follow suit, fueled by an avalanche of positive results from technology companies that reinforce the image of the sector in great shape.

Around 3:45 p.m., the Cac 40 gained 0.88% to 7,453.3 points on a trading volume of 1.1 billion euros. London’s Footsie 100 gained 0.5%, while the Dax fared much better in Frankfurt, gaining 1.6%.

Siemens Energy (+9.5%) and SAP (+6.7%) anchored the top two spots in the German index after posting better-than-expected quarterly results. Semiconductor equipment maker ASML, Europe’s leading technology cap, rose 7% in Amsterdam after it also reported better-than-expected quarterly profit and revenue, boosted by momentum in its China business. This pile of good news leads the Stoxx index to the the performance of the day in this sector.

Before the sun even rose in Europe, the day got off to a good start with Netflix currently up 11.6% in New York to a two-year high. The global video streaming giant said last night that it managed to attract more than 13 million new subscribers in the fourth quarter, a number that far exceeded analysts’ expectations, thanks mainly to the end of password sharing and revenue-boosting advertising patterns. .

The Nasdaq gained 0.7%, the S&P 500 gained 0.5% and the Dow Jones gained 0.4%.

Tesla is waiting around the corner

More results are on the agenda for the day, but everyone is waiting for Tesla, the first of the Magnificent Seven to be published, to go on the grill. You’ll have to wait until tonight. Analysts expect Elon Musk’s group to sell about 2.2 million cars this year, which would represent an increase of about 22% compared to 2023, according to data compiled by Bloomberg. But achieving that forecast comes with many challenges: automakers, suppliers and even rental companies warn of a decline in interest in electric cars. Tesla has been trying to cope with the slowdown in demand by cutting its prices…scratching its profit margins in the process. ” Negative developments in the global electricity market are very important to Tesla and can reasonably be expected to have a short-term negative impact on the stock. “, wrote Adam Jonas of Morgan Stanley, while emphasizing that Tesla is both an automotive and an energy, artificial and robotics company. The analyst expects “ clearly cautious forecasts for 2024 “.

In the macro economy, investors saw a broadly in-line increase in the composite PMI, a summary of manufacturing and services, which rose 0.3 points to 47.9 in January, according to a preliminary estimate. It is now at its highest level in six months. The Bloomberg consensus number was 48. Contraction in services rose very slightly, while manufacturing fell more sharply. In terms of prices, the overall rate of inflation for the cost of goods and services reached its peak since May.

That was largely driven by services, where net hiring rose and sales prices rose at the fastest pace since June. This situation will concern the European Central Bank, especially focused on inflation in services, responded Bradley Saunders, an economist at Capital Economics. Overall, the PMIs confirm our view that weak demand will weigh on the economy for some time to come, but the strength of price pressures will prompt ECB members to wait until the second quarter to cut rates. “. In the United States, PMI growth exceeded expectations, especially in the manufacturing sector (50.3), which emerged from the downturn.

Still in the Americas, but slightly further north, the Bank of Canada kept its key rate at 5% as expected. Its board of directors wants to see “ core inflation continues to decline steadily “.

The publication disappointed Alstom

In Asia, Hong Kong’s Hang Seng accelerated late in the session after the People’s Bank of China announced a reduction in the amount of cash banks must hold in reserves from February, a measure designed to boost the economy. The governor also said the new agency will be responsible for directing financial institutions to channel more funds into areas Beijing considers strategic … such as real estate.

As for the Cac 40, there was only one company on the table today and the race results are not considered conclusive. Alstom lost 5.5% after reporting lower-than-expected quarterly revenue growth. The French rail group also reported no major progress on its debt reduction plan, a key point of concern for investors.

Leave a Comment

Your email address will not be published. Required fields are marked *