North American News
The broader US indices close higher. Dow erases declines. Meta earnings mixed. Stock up
- Nasdaq up 2% on the day. S&P up 1%. Dow unchanged.
The broader broader US stock indices are closing higher in the day with the NASDAQ leading the charge with a gain of 2%. The S&P is up 1%, while the Dow Industrial Average is closing near unchanged.
The final numbers are showing:
- Dow Industrial Average and Rosen 6.9 points or 0.02% at 34092.97
- S&P index rose 42.61 points or 1.05% at 4119.20
- NASDAQ rose 231.78 points or 2.00% at 11816.33
- the Russell 2000 index rose 28.86 points or 1.49% at 1960.81
After the close Meta reported earnings of $1.76 which is a shy of $2.22 expected, but revenues were higher than expected at $32.17 billion versus $31.53 billion. Meta also announced a $40 billion increase in share buybacks. They see Q1 revenues of $26 billion – $28.5 billion which was between the expected $27.25 billion. After hours of trading as the stock up 12% as it reacts to the buybacks. Advertising revenue was also higher at $31.25 billion versus expected $30.86 billion.
US December JOLTS job openings 11.01M vs 10.25M expected
- JOLTS jobs data for the month of December 2022
- Prior was 10.458m
- Hires 4.0% vs 3.9% prior
- Quits 2.7% vs 2.7% prior
- Layoffs 1.0% vs 0.9% prior
- Layoffs and discharges decreased in finance and insurance (-43,000) but increased in federal government (+4,000).
ISM January US manufacturing PMI 47.4 vs 48.0 expected
- ISM manufacturing PMI for January 2023
- Prior month 48.4 (was expecting 48.5)
- Prices paid 44.5 vs. 39.5 estimate. Last month 39.4
- employment 50.6 vs. 49.0 estimate. Last month 51.4
- new orders 42.5 vs. 45.1 last month
- production 48.0 vs 48.5 last month
- order backlog 43.4 vs. 41.4 last month
- new export orders 49.4 vs. 46.2 last month
- imports 47.8 versus 45.1 last month
Atlanta Fed GDPNow estimate for 1Q growth stays unchanged at 0.7%
- First quarter GDP growth estimate from the Atlanta Fed
In their own words:
“The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2023 is 0.7 percent, unchanged from January 27 after rounding. After this morning’s construction spending release from the US Census Bureau and the Manufacturing ISM Report On Business from the Institute for Supply Management, the nowcast of the contribution of inventory investment to first-quarter real GDP growth increased from -1.43 percentage points to -1.40 percentage points.”
Federal Reserve hike rates by 25 basis points, as expected
- Highlights of the FOMC statement on February 1, 2023
- Prior rate was 4.25%-4.50%
- Market pricing suggested a 96% chance of a 25 bps hike
- Repeats that “recent indicators point to modest growth in spending and production and that jobs gains have been robust”
- Statement says “ongoing increases in the target range will be appropriate”
- Unanimous vote
- Says “Inflation has eased somewhat but remains elevated.” in a change from “Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures.”
- Prior “In determining the pace of future increases in the target range” is now “In determining the extent of future increases in the target range”
Commodities
Spot gold soared and currently hovers at around $1,950 a troy ounce
US weekly crude oil inventories +4140K vs +376K expected
- Weekly US petroleum inventories
- Prior was 10440K prior
- Distillates 2320K vs -1300K expected
- Gasoline 2576K vs 1442K expected
- Refinery utilization -0.4% vs +0.5% expected
The price of WTI crude oil tumbles to a new session low
- Trades down to $76.22
The price of WTI crude oil has tumbled lower over the last few hours and currently trades at $76.33. That’s down $2.69 or -3.41%.
EU News
Major European indices close mixed
- German Dax, Spain’s Ibex and Italy’s FTSE MIB close higher
The major European stock indices are closing with mixed results:
looking at the closing levels:
- German Dax rose 52.45 points or 0.35%
- France’s CAC felt -5.31 points or -0.07%
- UK the FTSE 100 fell -10.57 points or -0.104%
- Spain’s Ibex rose 64.10 points or 0.71%
- Italy FTSE MIB rose 104.13 points or 0.39%
Other News
Powell opening statement: We have more work to do
- Comments from Powell in the opening statement of his press conference
- We have covered a lot of ground over the past year
- Full effects of hikes have yet to be felt
- Housing activity continues to weaken
- Consumer spending appears to be subdued
- Fed will likely have to maintain restrictive stance for some time
- The jobs market remains extremely tight
- Pace of jobs gains has slowed and nominal wage growth too, but labor market is out of balance
- Inflation in last three months show a welcome reduction in the pace of increases
- We will need ‘substantially more evidence’ to be confident that inflation is on a downward path
- Long term inflation expectations remain well anchored but the longer inflation remains high, the more likely it is to remain entrenched
- Fed highly attentive to risks from inflation
- The historical record cautions strongly against premature easing
Cryptocurrency News
Bitcoin continues to consolidate near 5 1/2 month highs
- Trades near the mid-August levels
The price of bitcoin has been trading in an up and down range near the 5 1/2 month highs (going back to mid-August).
The range since January 20 has seen the digital currency trade between $22,334 and $23,954. In between those extremes sits the 100 and 200 hour moving averages which are now moving sideways.
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