Mixed trend on Wall Street; Micron drops by about 5%, Nvidia by 1.5%

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

16:58

Trading on Wall Street is underway in the afternoon with little changes – Nasdaq is up 0.1%, Dow Jones is down 0.1% and the S&P 500 is unchanged.

The market is affected by the disappointing forecasts of Micron which clouds the rest of the chip stocks and,Nvidia Among them, in addition it was announced earlier that the GDP of the USA increased by 1.4% in the first quarter (on an annual basis), slightly more than the previous quarter, 1.3%, the market is also eagerly awaiting the PCE index that will be published tomorrow.

Today one of the biggest stock splits in the history of Wall Street is launched as the Mexican restaurant chain Chipotle Mexican Grill Split at a ratio of 50 to 1, the company’s first split. Cipoletta is one of the holdings of Bill Ackman’s Pershing Square hedge fund.

Pershing Square’s major holdings are Alphabetical (Google) Chipotle, Hilton and,Restaurant Brands International which owns, among others, Burger King and the Popeyes fast food chain, these constitute about 70% of the total assets managed by the fund, about 10 billion dollars.

16:32

Trading on Wall Street opened this afternoon with little change – the Nasdaq rose 0.1%, the Dow Jones fell 0.1% and the S&P 500 was unchanged.

The chip maker’s quarterly report Micron It was met with disappointment in the market, which puts pressure on other chip stocks, in particular Nvidia , AMD and,Intel .

Although it met expectations, Micron gave a tepid forecast for the second quarter, investors expected more. Bloomberg noted that Micron’s report is a reminder to investors of the risks that exist in the artificial intelligence chip market.

15:32

US Macro – The US Bureau of Statistics has just published that the country’s gross product grew by 1.4% on an annual basis, in line with expectations.

14:50

The mixed trend in Europe continues. The Dax rises by 0.1%, the Potsi sheds its value by 0.3% and the French CAC rises by 0.6%.

H&M Plunges by about 12% after reporting a smaller than expected increase in the company’s profits and providing a disappointing sales forecast for the rest of the year. The world’s second-largest retailer reported operating profit of 7.1 billion Swedish kroner ($672 million), below early forecasts of 7.37 billion Swedish kroner.

12:21

Chip company stock Micron Technology Down about 6% in early trading after last night disappointing investors with the forecasts it published in its financial reports. The company surpassed the forecasts in the line of profit and revenues, which amounted to approximately 6.81 billion dollars. Looking ahead, the company expects adjusted earnings per share to be $1.08 on revenues of $7.6 billion in the current quarter. The analysts expected the forecast for the company’s earnings per share to be $1.05 on revenues of $7.6 billion.

10:34

European stock markets are currently trading in a mixed trend. The DAX is up 0.4%, the FTSE sheds 0.1% and the French CAC is up 0.1%.

The futures contracts are traded by the hour in falling rates.

08:38

This morning in Asia, the main indexes are trading lower. The Nikkei sheds about 1.1% of its value, the Hang Seng plunges about 2%, the Shanghai Stock Exchange falls by 0.5% and the Kospi index loses its value by 0.4%.

In the US, futures are trading lower this morning.

Last night on Wall Street, the main indices closed in a mixed trend: the Dow Jones and the S&P 500 rose by 0.1% each, and the Nasdaq index added about 0.5% to its value.

The star of the evening was Amazon which jumped about 4% to an all-time high and traded for the first time with a market value of over 2 trillion dollars. In the meantime, Amazon joined the group of only public companies in the world that are traded at a value of 2 trillion dollars or more and among them Microsoft , Dark , Nvidia and,Alphabetical .

Against the backdrop of Amazon’s gains, Bank of America analysts raised their target price for the stock from $210 to $220, a price that represents an upside of 12%.

At the same time, this morning (Thursday) CNBC reported that Amazon plans to launch a new store on its website that will include fashion and lifestyle items at low prices that will allow Chinese sellers to ship the goods directly to consumers in the US.

The launch of the store actually marks Amazon’s attempt to fight the growing competition from e-commerce companies Temu and Shane, which have strong ties to China. Temu and Shane have expanded their presence in the US in recent years, attracting a large share of American consumers with low prices on clothing, electronics, home goods and more.

Amazon said that the new store will include a variety of non-branded items, many at prices under $20.

Also a share fdx gathered interest when it jumped more than 15% after releasing its financial results for the fiscal quarter on Tuesday in which it beat analysts’ forecasts in the line of profit and revenue. Following this, the company’s stock recorded the highest jump since 1986 and traded at a high not seen since July 2021.

In the American debt market, bond yields climbed last night during trading, with the 10-year government bond trading at a yield of 4.33%, and the yield on the two-year bond rose to 4.75%.

In the currency market, in Japan, the yen reached a 38-year low against the dollar last night (Wed), which raised speculation that the central bank might intervene again in the Japanese currency market. The yen weakened to a level of 160.82 against the dollar and broke the previous record of 160.03 at the end of April and reached its weakest level since 1986.

In the macro sector, tomorrow (Friday) at 15:30 Israel time, the PCE index (the Fed’s preferred price index) for the month of May is expected to be published in the US. Forecasts in the markets estimate a minimal decrease in the general index to a rate of 2.6%, compared to the current figure of 2.7 %. The core index is also predicted to drop to 2.6% from the current level of 2.8%.

If these forecasts come true, they will indicate a continued gradual moderation in inflation, but not at a level that will allow the Fed to cut interest rates soon. Most of the forecasts estimate that the Fed will initiate monetary easing between the September interest rate decision and the November decision – close to the time of the US elections or right after it.

In its review, the research unit of the American investment giant Blackrock referred to the rally in the US stock market, which is breaking records mainly thanks to the technology sector: “We are less worried than others in the market about the group of technology stocks that lead the profits. This is because, firstly, the enthusiasm for artificial intelligence (AI) is supported by the companies’ performance, which meet and even surpass market profit expectations. Second, the profit margins in the technology sector do lead the market, but these are also recovering in other sectors due to the cooling of inflation.” Therefore, at BlackRock “we continue with an overweight allocation to US stocks for a period of six to 12 months”.

The analysts explain that “the strong profits of the technology stocks are driven by investors who prefer quality. Also, the leading technology companies are very profitable and have large cash reserves, which allows them to invest massively in the establishment of AI infrastructures, such as data centers.”

On the question of whether there is anything that can stop the run in technology stocks, BlackRock notes possible scenarios in which the markets may lose confidence, if it turns out that corporate spending on artificial intelligence has not paid off; if a regulatory change is passed that limits the adoption of AI; And the less likely scenario that other sectors overtake the technology sector is if growth in the US economy accelerates, and inflation falls enough to allow the Federal Reserve to lower interest rates by a higher rate than expected.