Mixed trend in Asia; The Nikkei plunged by about 2.7%

Trade overview: current reports, trends, indices, stock prices, bonds, foreign exchange and commodities and analyst recommendations

08:32

The trading day in Asia is hourly in a mixed trend. The Nikkei plunged by 2.8%, the Shanghai Stock Exchange rose by 0.1%, the Hang Seng rose by 0.9% and the Kospi index fell by 0.5%.

Futures in the US are trading in a positive trend.

Last night (Thursday), on Wall Street, on the last trading day of the month, trading closed with sharp declines and erased all monthly gains and even interrupted the longest streak of monthly gains since 2021 (six months).

The S&P 500 fell 1.6%, while the Nasdaq fell 2.7%. Both indexes are on track for a second consecutive day of declines. The Dow Jones fell 0.8%.

Microsoft fell 6%, its worst day in two years, since October 26, 2022, when it fell 7.7%. So it happened a month before the public launch of Microsoft-backed OpenAI’s ChatGPT, which ignited the massive AI investment wave.

Amazon Jeff Bezos’ retail giant, published last night (Thursday) the financial reports for the third quarter of this year. Amazon beat forecasts and reported quarterly revenue of $158.9 billion, when Wall Street analysts predicted revenue of $157.3 billion. In the line of earnings per share, the company reported $1.43, thus surpassing the forecasts of analysts who predicted earnings per share of $1.14. The stock is currently trading at an increase of about 4.5% in late trading.

Intel posted another drop in sales and profitability – not surprisingly – considering its shrinking market share in the personal computer market, the US government’s ban on selling advanced chips to customers in China, and China’s decision to remove Western chips from its telecommunications networks.

Intel’s revenues amounted to 13.28 billion dollars, higher than the expectations of analysts who predicted a quarterly revenue level of 13.04 billion dollars. The revenues still reflect a decrease compared to the revenues of $14.16 billion in the corresponding quarter last year, but this is a lower decrease than the analysts expected. The company’s stock jumps more than 14% in late trading.

The technology giant dark reported revenues of $94.9 billion, thus slightly short of analysts’ forecasts of $94.58 billion. In the line of earnings per share, the company reported 1.64 dollars per share, the analysts’ forecasts were 1.6 dollars per share. The stock is down about 2% in late trading.

stock Lemonade Soared by over 25% after the digital insurance company overcame the forecasts in the third quarter reports it published yesterday (Wed) after the end of trading. Lemonade, under the management of founders Daniel Schreiber and Shay Wininger, reported a 19% growth in revenue to approximately $137 million, a GAAP net loss of $67.7 million (compared to $61.5 million in the corresponding quarter) and a negative EBITDA of $49 million.

The company expects to end the year with revenues of 522-524 million dollars, higher than analysts’ forecasts, and with a negative EBITDA of 151-155 million dollars. The company predicts that 2024 will end with a positive flow and indicates in a letter to investors the acceleration in growth and the transition to a positive EBITDA during 2026.

In the commodity market, oil prices jump this morning (Friday) by about 2%. The price of a barrel of Brent trades around 74.2 dollars and the price of a barrel of WTI stands at 70.7 dollars.

In the American debt market, government bond yields trade in a mixed trend. The 10-year yield drops slightly to 4.27% and the two-year yield trades stably around 4.17%.

In the macro sector, the focus today (Fri) will be on the publication of US employment data. According to forecasts, the addition of jobs to the US economy in October is expected to be 111 thousand, compared to 223 thousand in September. The unemployment rate is expected to remain unchanged, at 4.1 %.

Ofer Klein, head of the research division at Harel, says that the major hurricanes that hit the east of the country are expected to be a negative weight (at least temporarily) on the data. “Despite the strong data, we believe that the central bank will reduce the interest rate by another quarter of a percent in its next decision in light of the drop in inflation and the high level of the real interest rate.”

Leader Capital Markets also stated that “October’s employment figures are expected to be relatively weak mainly due to the hurricanes with a moderate increase of about 110 thousand employed, which will support
in lowering the Fed interest rate by 0.25% in the upcoming decision.”