0:01

A listener production. US

0:04

stocks find their footing ahead

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of a tsunami of corporate earnings. And

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Aussie shares expected to lift on Tuesday,

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building on gains from Monday. I'm Tom.

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And I'm Ryan. It's Tuesday, the 23rd of April.

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Welcome to the Comsec Market Update. Ryan,

0:20

a welcome reprieve in the atmosphere as

0:22

far as US stocks in particular are

0:25

concerned. They found their footing in the

0:27

session. As we record now,

0:29

we've just seen the US markets close. The

0:31

Dow Jones up by around 0.7%. The

0:34

S&P 500 up 0.9%. The

0:36

NASDAQ up 1.1%. Spire

0:39

Futures still waiting on the platform up by 0.2%

0:41

although the ASX 200 was up by 0.7%

0:44

yesterday. Well, yes, we did see the ASX

0:46

lift by 1.4% yesterday. We

0:49

saw the stock market rebound after a

0:52

$2 trillion sell-off on Friday as tech

0:54

shares rebounded and tensions in the Middle

0:56

East dim-tom. They have been a

0:59

big talking point. If you

1:01

rank that up against the

1:04

earnings season, the inflation figures,

1:07

where would you rate the

1:09

Middle East issue? Presently

1:11

at the back of the queue. Ahead

1:14

of Apple, Microsoft, Alphabet,

1:16

Tesla, Amazon, Meta, Nvidia,

1:19

all reporting earnings, you have got more

1:21

than $3 trillion worth of

1:23

market cap waiting in the wings

1:26

to report how they fared over

1:28

the course of the last quarter.

1:31

180 S&P 500 companies, more than 40%

1:33

of its market capitalization are due to

1:36

report their results this week, Tom. It's

1:38

amazing, isn't it? It is. It's

1:40

exciting. I think if you put that into context,

1:42

the S&P 500 has fallen by about 5% since

1:45

the beginning of

1:50

the month. For your money, does that give

1:52

you a little more confidence in terms of

1:55

dipping your toe in the water? Do you

1:57

want to see the whites of the eyes

1:59

of corporate earnings? the PCE inflation numbers at

2:01

the end of the week. I'd like to see

2:03

both. I think it's just the standard buy on

2:05

the dip after 5% pullback, the kind of situation

2:08

that wakes people up to put money

2:10

to work. But of course, investors looking

2:12

ahead this week to these hugely significant

2:14

earnings results concerns about what the Fed

2:16

is doing with pushing back any rate

2:18

cuts. We've got a blackout for Fed

2:20

speakers this week. We've got the all-important

2:22

Federal Reserve meeting next week. So we

2:24

won't hear the dulsey tones of any

2:26

of those speakers this week. Yes, we'll

2:29

certainly be mourning their absence. So in

2:31

terms of some of the themes that

2:33

stood out last night, the

2:35

technology space obviously led the improvements.

2:38

The Philadelphia Semiconductor Index was up

2:40

by 1.7% last night. Some

2:44

of the features in that recovery included

2:47

ARM holdings, shares they were up by

2:49

7% of course, a

2:51

noted chip designer, Nvidia, a

2:54

chip maker, up 4% Micron,

2:56

technology and memory. Space

2:58

maker up by around 2%. What

3:02

has stood out to me,

3:04

Ryan, is that we have

3:06

often spoken about the leadership

3:08

of technology. But the Philadelphia

3:10

Semiconductor Index started its sell-off

3:13

in early March. Okay, and from that point, that

3:15

index has fallen by the most part of 20%,

3:17

down by about It

3:20

took another two and a half,

3:23

almost three weeks for the S&P 500 to

3:25

sell off aggressively. Would

3:27

you give it the hallmark of

3:29

being a leader at the moment?

3:31

Well, certainly we are seeing the

3:33

shine come off those AI-related stocks.

3:35

That's the concern at the moment,

3:37

whether that's the beginning of the

3:40

end of that run or whether

3:42

that will continue based on the earnings

3:44

results we're expecting to see. So we

3:47

have seen, of course, on Friday, a 10% drop

3:49

in the video. Today it's advanced 4.4%. We

3:52

have seen some of those other mega cap-grow

3:54

stocks edge higher like Alphabet, Amazon and Apple

3:57

up between 0.5% and 1.5%. The

4:00

one that stands out to me at the moment, Tom,

4:02

is Tesla. It

4:04

is under enormous pressure. It's got a width,

4:06

hasn't it? It does. So it was down

4:08

3.4% hitting a 15 month low. Its

4:11

results are out tonight, which is going

4:13

to be highly anticipated. The

4:16

EV maker cut prices in a number of

4:18

its major markets, including China and Germany over

4:20

the last 24 hours. And

4:22

that follows price reductions in the United

4:24

States. So Tesla's share price is down

4:26

over 40% year to date. It's

4:30

quite the carnage. And

4:32

there's been a laundry list of woes for Tesla. We've had

4:34

a dive in vehicle sales, Elon

4:36

Musk's $56 billion pay

4:38

package, which has been quite controversial. They've

4:41

axed 10% of their staff. All

4:43

eyes will be on whether

4:45

they can explain China's growth decline,

4:48

provide clear guidance on growth, margins and

4:50

cash flow, and confirm development status of

4:52

the Model 2 and detailed plans for

4:54

AI tonight. The bar is extraordinarily high.

4:57

It is. It's

5:00

not the worst one of the worst performing shares

5:02

in the S&P 500. One

5:05

of the things that did stand out though, Tom,

5:07

in contrast to the EV, so we did see

5:09

Finfast auto down 9.5%, Chargepoint down 8.5%, Polstered down

5:11

4.4% and Lucid Group 3.9%. So

5:17

a bad day for the EVs. But

5:19

legacy automakers were strong performers.

5:21

So Ford Motor, for example, led the S&P

5:24

500 in terms of gainers up 6.1%. Musk

5:27

got earnings results on Wednesday and General Motors was

5:29

up about 2% Tom. It's

5:31

true that we are sort

5:34

of distracted. We're looking in

5:36

one direction preoccupied with the

5:38

technology space, whereas your

5:41

very long established

5:43

names can be doing

5:45

extraordinarily well in another

5:47

space, United Airlines stands out

5:49

like that organization

5:52

betted expectations off an extremely low

5:54

base. But since reporting its earnings

5:56

last week Ryan, that shares

5:58

are up 30% less. amazing. It's

6:00

extraordinary right? Yeah, an airline. Yeah, it's a

6:02

brave space to compare that

6:05

to Air New Zealand yesterday which tanked. The

6:08

other company that stood out last night was

6:10

telecommunications giant Verizon. It was down 4.7%. One

6:12

of the worst performers

6:14

after posting mixed quality results

6:16

Tom. Infamatica is another organization

6:18

that did last night so

6:20

this has been apparently reportedly

6:22

in the crosshairs for Salesforce

6:24

as a potential acquisition target

6:27

and that was dismissed overnight

6:29

which saw the shares down

6:31

in double-digit terms. Let's quickly

6:33

move over to what happened

6:35

in Europe this day. So

6:37

what we tended to see

6:40

was communication stocks do quite

6:42

well. Energy stocks did reasonably

6:44

well also. BPS shell to

6:46

tail up by more than a percent. Workman-like

6:49

efforts from European stock indices. The

6:51

stock 600 was up 0.6. The

6:54

footseat up 1.6. The French market up by

6:56

a quarter. The German DAX up by around

6:58

0.7%. The underperforming

7:01

groups there. Technology didn't

7:03

fare so well and materials were flat.

7:05

So that's something to keep an eye

7:07

on as far as our own experience

7:09

is concerned today. If we look at

7:11

the UK footseat 100 index, it's straddled

7:13

record highs overnight. So markets now pricing

7:16

in the likelihood of a rate cut

7:18

in August that has provided some support

7:20

to the footseat 100 along with the

7:22

weaker British pound and also rising

7:24

metal prices as you mentioned and a quick

7:26

shout out to Greece of course our Bostonic

7:28

critic costs is a person

7:30

that has some interest in that country. The

7:33

FX index gained 2% after credit

7:35

ratings agency S&P revised the country's

7:37

outlook to positive from stable. Who

7:39

would have thought that after what we

7:41

saw about a decade ago? Indeed Nick

7:44

could be delighted for the reference

7:46

morning and the futures are

7:48

indicating as I said that we'll be

7:50

up by around 0.2% in local terms

7:52

today. We've got some manufacturing numbers to

7:55

look at. They're not going to move

7:57

the needle. Everyone is in a

7:59

ninja. the crouch and anticipating tomorrow's quarterly

8:01

inflation numbers. That's right. So that's the

8:04

key focus of this week. And we'll

8:06

do a preview of that tomorrow. We've

8:08

got the purchasing manager indexes for the

8:11

services manufacturing sector today, as you mentioned,

8:13

Tom, brambles, Northern Star Resources, Stammoor Resources

8:15

and Strike Energy all issue quarterly production

8:17

updates. Drone Shield hosts an annual general

8:20

meeting. But in terms of the commodity

8:22

markets, it looks like it could be

8:24

a bit of a down day there.

8:27

So that's probably holding back our spy

8:29

futures today. We've seen the US

8:31

oil and Brent prices down about

8:33

0.3% overnight as that risk

8:35

premium associated with the Middle East continues

8:38

to fade from markets. One area of

8:40

particular interest as well was gold. It

8:42

was down 2.8% to 23, 46.40

8:45

US dollars an ounce overnight. That's

8:48

the biggest one day decline intraday

8:50

in about a year. And

8:52

then of course, all futures were pretty steady up 0.3%

8:54

to 108.62

8:57

US dollars a tonne. And the Aussie dollar has

9:00

been creeping higher. It's trading just short of

9:02

64.5 US cents,

9:04

having had a spell below the 64 cent

9:06

mark in the last couple of

9:09

days. It's doing reasonably well, mainly because things

9:11

have calmed down where the US dollar

9:13

is concerned. So we're building up to

9:15

some pretty impressive highlights as far as

9:17

the week is concerned. Calm

9:20

your nerves today because they could potentially be down

9:22

to a challenge in the days ahead. Have a

9:24

great day. We'll talk to you again soon.

9:54

We'll be back.