Day: August 5, 2024

ISM Services Calm Financial Markets, Showing Stability in the Sector

Posted on by Skerdian Meta

The US ISM services data for July, which showed that the sector is in robust condition, helped the markets recover after a particularly pessimistic start today. Following the worst day for the Japanese stock market in nearly forty years, US traders stepped in to stabilize the market as investors grappled with the unwinding of the carry trade and rapid deleveraging in an uncertain economic climate.

US Services remain robust

Continue reading “ISM Services Calm Financial Markets, Showing Stability in the Sector” →

Positive Earnings Report Boosts Tyson Foods Stock

Posted on by Timothy St. John

Tyson Foods (TSN) released its third quarterly fiscal earnings report and came out ahead of the estimates from the Zacks Investment Research firm.

Tyson Foods just posted their quarterly earnings.

The company, famous for its frozen chicken offerings, posted quarterly earnings of $0.87 per share, which is dramatically up from last year’s $0.15 per share. It also beat out the estimate of $0.61 per share, and the stock price soared to gain 3.62%.

 

The company has managed to surpass estimates for its earnings for each quarter over the last year, beating estimates this quarter by 43%. The company’s revenue for the quarter added up to $13.35 billion, which managed to beat the anticipated revenue by 1.42%. Compared to last year at this time, the company is up, beating those revenue numbers by 1.5%.

Will the Current Stock Price Hold?

Should investors expect some pullback on the stock price after today’s unexpected jump? That mostly depends on what the company’s management has to say about their earnings report and what they announce for future plans. Tyson’s share price has jumped nearly 14% this year so far, and that beats out the S&P 500’s gain for the year.

The expectation for Tyson Foods after four better-than-expected quarters of earnings for the company is that this trend will continue. However, the stock market is currently very low, suffering from the negative effects of a poor jobs report. With unemployment higher than analysts anticipated, it is expected that the stock market will continue to suffer for the short term.

Tyson stock has proven to beat out analyst estimates before, though, so this one is hard to predict. We would not count this stock as one to overlook for now. Investors should consider Tyson Foods because of its strong performance in spite of a down market. The stock is not likely to outperform the market by a large margin, but it could be a standout investment during the current downturn.

 

 

Dax 30 and Stock Markets Reverse Higher After the Crash

Posted on by Skerdian Meta

Dax 30 and stock indices had another terrible day today, but they found some support at last and have managed a decent bounce. Risk trades had a devastating European session marked by a complete flight to safety across all markets. This shift soon led to a sell-everything mode as precious metal prices dropped. Silver plummeted by about 7% to $26.50, while gold lost more than 3%, nearing $2,364. The price of copper futures also fell below $4. USD/JPY dropped to 141.60, more than 20 cents down from the highs a month ago, as the carry trade unwound, causing the Nikkei to suffer its worst decline since 1987. Continue reading “Dax 30 and Stock Markets Reverse Higher After the Crash” →

Wall Street’s “Fear Index” Records Its Largest Intraday Surge in History

Posted on by Ignacio Teson

The most closely watched investor anxiety gauge on Wall Street recorded its largest intraday surge in history on Monday morning, as U.S. stocks tumbled amid growing fears that the United States may be entering a recession.

The CBOE Volatility Index (VIX) reached a peak of 65.73, about 42 points higher than last Friday’s close, as Wall Street began the week following a global market sell-off, which at one point saw Japanese stocks surpass the losses of “Black Monday” in 1987.

The VIX rose 34 points to its highest level since March 2020. During the day, however, traders softened their spirits.

This volatility spike comes after an unusually long period of calm in the market, during which the S&P 500 went 356 sessions without a 2% or greater drop, the longest streak since 2007.

It has been an unusually long period where stocks kept rising, and it was assumed that all one needed to do was wait, and eventually, they would go up. At some point, this disconnects from reality.

The recent collapse in global equity markets is more a reflection of a liquidation of “carry trade” operations, which investors use for leverage, than a sudden shift in the economic outlook for the United States.

Instead, the likely explanation lies in a fresh and significant unwinding of “carry trade” positions, where investors borrow money from economies with low-interest rates, such as Japan or Switzerland, to finance investments in higher-yielding assets elsewhere.

The Japanese yen has surged more than 11% against the dollar since hitting its 38-year low just a month ago.

Commodities Fall Dragged Down by Recession Fears in the U.S.

Posted on by Ignacio Teson

Commodities such as oil, natural gas, metals, and agricultural products continued to follow the global equity market’s decline this Monday, as fears of a U.S. recession fueled concerns about demand.

Commodities had already been affected in recent weeks, weighed down by the sluggish Chinese economy, their main buyer, with crude oil falling around 5% last week, copper hitting four-month lows on the London Metal Exchange (LME), and corn nearing its lowest level since 2020.

Oil was down around 1-1.5% this Monday in a volatile session, less than the losses in major stock indices, as fears of a U.S. recession and its potential implications for oil demand were somewhat mitigated by price support from rising tensions in the Middle East.

Geopolitical factors, such as concerns over supply disruptions in the Middle East and the growing belief that OPEC will not withdraw its voluntary production cuts, are providing relative support to oil prices compared to equities.

[[USOIL-graph]]

Copper prices fell by more than 3%, reaching four-and-a-half-month lows, as the deteriorating demand outlook in China and the United States, the world’s two largest economies, triggered a sell-off in the metal used in energy and construction.

Gold, meanwhile, was down by 2.7%.

European contracts for gas, electricity, and coal also declined. Benchmark European gas for the next month dropped more than 5% in early trading, reaching 35.17 euros per megawatt hour.

Wall Street trims losses despite prevailing fears.

Posted on by Ignacio Teson

The tech sector leads the losses, with Nvidia’s shares standing out, dropping as much as 10% earlier.

So far, intraday movements have been optimistic, with a reduction in losses and gains throughout the day. However, the overall trend remains negative.

The three major Wall Street indices are falling sharply this Monday morning. The stock averages are retreating amid a massive sell-off driven by investor concerns about the U.S. economy.

The main Dow Jones index, composed of 30 giants, is down 2.28%, standing at 38,832.43 points. The S&P 500, with 500 components, falls 2.82% to 5,196.02 points, and the tech-heavy Nasdaq Composite drops 3.46% to 16,195.79 points.

[[SPX-graph]]

All three indices posted significant losses last week. The Dow Jones fell by 2.10%, the S&P 500 declined by 2.06%, and the Nasdaq saw the steepest drop, losing 3.35%.

Volatility has reached levels not seen since March 2020, when the COVID-19 pandemic struck the markets with widespread crashes. The VIX index, known as the “fear gauge” and a measure of market volatility, has surged by 100%.

Among the hardest-hit sectors is technology (-5%), with Nvidia’s shares leading the declines, plummeting by 10%. Within the Dow Jones, all stocks are down, led by Intel, which has fallen by 6.49%.

Intel’s shares closed Friday with a loss of 26%, marking their worst drop in 50 years, after announcing a cut of 15,000 jobs, the suspension of its dividend, and issuing guidance that was deemed disappointing.

Mexican Peso Drops 2.5%, Reaching Its Lowest Level in Two Years

Posted on by Ignacio Teson

The Mexican peso leads losses in the foreign exchange market due to growing fears that the United States is approaching a recession and that a Federal Reserve interest rate cut may come too late.

The Mexican peso is falling sharply this Monday morning. The local currency is leading declines, driven by investor concerns that the United States is edging closer to a recession and that a Federal Reserve rate cut might be delayed.

The spot exchange rate stands at 19.6548 pesos per dollar. Compared to Friday’s official close of 19.1624, according to data from the Bank of Mexico (Banxico), this movement represents a loss of 49.24 cents, equivalent to a 2.57% decline.

[[USD/MXN-graph]]

In just the last three sessions, the peso has accumulated a loss of around 5.5% after reports on Thursday showed that U.S. manufacturing activity fell to its lowest level in eight months, followed by a weak labor market report on Friday.

Mexico is highly sensitive to the outlook for the U.S. economy, its main trading partner. Additionally, the Mexican peso has been under significant pressure since the local elections on June 2, when Morena secured a landslide victory.

Since then, the peso has accumulated a loss of more than 15%.

Gold Bounces Above $2,400 After the Crash Stops at 50 Daily SMA

Posted on by Skerdian Meta

On Friday, Gold nearly reached its all-time high from last month, but reversed and fell below $2,400 today, however the 50 daily SMA stopped the fall. The surge in July was driven by a shift to risk aversion as the U.S. economic outlook dims. This spike was not merely a reaction to worsening economic prospects around the world, but also to rising geopolitical tensions in the Middle East, which have historically boosted Gold’s allure as a safe haven. However, gold tends to perform well during bad times, but not when the situation becomes extremely dire, as evidenced in the last two trading days. Continue reading “Gold Bounces Above $2,400 After the Crash Stops at 50 Daily SMA” →

Ether Tumbles 20% Following $46M ETH Transfer by Major Trading Firm

Posted on by Arslan Butt

In a recent, noteworthy financial manoeuvre, a wallet reportedly linked to Jump Trading, a prominent player in the cryptocurrency arena, transferred a substantial sum of 17,576 Ether (ETH) to centralized trading platforms. This revelation was made by the on-chain analytics firm Spot On Chain.

This substantial movement of Ethereum tokens is part of a broader financial strategy, possibly signalling upcoming liquidations.

This transaction precipitated a significant decline in Ether’s value, plunging by 20% and reaching a seven-month low of just under $2,100 during Monday’s trading session in Asia.

Continue reading “Ether Tumbles 20% Following $46M ETH Transfer by Major Trading Firm” →