North American News
Stocks are more than halfway through the week and major indices are higher
- Can they make it through the next 2 days and close higher on the week
The major US stock indices are all closing higher on the day. Moreover, the indices are also higher on the week with 2 days left to go. When the S&P and NASDAQ index are down for 7 consecutive weeks and the Dow is down for 8 consecutive weeks, closing with a positive week is a big thing.
The final numbers are showing:
- Dow Jones, +191.66 points or 0.6% at 32120.27
- S&P index up 37.25 points or 0.95% at 3978.74
- NASDAQ index up 170.3 points or 1.51% at 11434.75
- Russell 2000 rose 34.33 points or 1.95% at 1799.16
After the close Snowflake revenues beat but earnings-per-share were much weaker than expectations:
- Revenues $422.4 million vs. $412.8 million estimate revenues are up 85% year on year
- Earnings-per-share -$0.53 vs. $0.01 estimate
Although the revenues are up strongly and yoy sales gains are impressive at +85%, companies that don’t make any money are having a tough time. Shares of Snowflake are down -11% in after-hours trading.
Nvidia are expected to be released at 4:20 PM ET with earnings expected at $1.29/$0.67 GAAP on revenues of a $8.12 billion
UPDATE Nvidia:
- EPS $1.36 vs $1.29
- Rev 8.29B vs 8.12B estimate
- Guidance for Revenue is $8.10B vs $8.44B est.
- Shares are down -7%
US treasury sells $48 billion of 5 year notes at a high yield of 2.736%
- WI level at the time of auction was at 2.732%
- High yield 2.736%
- WI level at the time of auction at 2.732%
- Tail 0.4 basis points vs six-month average of 0.0 basis points
- bid to cover 2.44X vs. six-month average of 2.45X
- Directs (a measure of domestic demand) 20.0% vs. six-month average of 17.4%
- Indirects (a measure of international demand) 62.9% vs. six-month average of 63.9%
- Dealers 17.0% vs. six-month average of 18.7%
Atlanta Fed GDPNow falls to 1.8% from 2.4% last
- GDP growth estimates for the 3Q from the Atlanta Fed GDP model
The Atlanta Fed GDPNow estimate for 3Q growth was lower to 1.8% from 2.4% on May 18. Releases from the US Census Bureau (durable goods) and the National Association of realtors (new home sales) has led to the lower forecast.
Commodities
Gold Price Forecast: XAU/USD bulls move in at a key support area on the FOMC minutes and a softer US dollar
- The FOMC minutes failed to underpin the greenback and the gold price is attempting to rally.
- The gold price is breaking out of the correction’s dynamic resistance and bulls eye the prior highs near $1,865 for the sessions ahead.
- Breaking: FOMC Minutes sink the US dollar a touch despite inflation risk skewed to the upside
At $1,851, the price of gold is down around 0.8% on the day as the US dollar breaks higher from a two-day losing streak on Wednesday. The yellow metal has slid from a low of $1,841.60 to a high of $1,868.11 so far on the day but has found some solace on the basis that there has been no mention of larger rate increases within the Federal Open Market Committee minutes of the May meeting.
The minutes that came out at 2 p.m. EDT (1800 GMT) failed to support the US dollar any higher on the day so far. The greenback slid on the release within a 102.449 and 101.728 range for the day. In his most hawkish of questions and answers, the US Federal Reserve Chair Jerome Powell told the Wall Street Journal that he was adamant that the central bank would continue hiking rates until there is clear and convincing evidence that inflation is under control.
“In particular, Chair Powell has reiterated on several occasions the Fed’s guidance of implementing additional 50bp rate hikes at the June and July FOMC meetings, and we expect the May meeting minutes to provide further colour about those plans,” strategists from TD Securities explained.
However, the minutes lacked any mention of a faster pace of larger rate increases which has given risk appetite a boost in the late New York session. All three major US stock indexes fluctuated earlier in the session amid concerns about a cooling economy, but in recent trade, the benchmarks are tracking higher on the day to session highs. The S&P 500 is now over 1% in the green while the Dow is up around 0.7% with the NASDAQ printing 1.41% higher. US 10-year Treasury yields, which hit 3-1/2-year highs earlier in May, have since fallen back towards the six-week lows printed earlier on Wednesday after data showed new orders for US-made capital goods rose less than expected in April.
The dollar was already under pressure prior to Wednesday’s recovery due to the European Central Bank chief Christine Lagarde flagging an end to negative interest rates in the eurozone in the third quarter. Her comments have implied an increase of at least 50 basis points in the deposit rate and fueled speculation of bigger hikes this summer. This too is giving the gold bugs some relief.
Analysts at TD Securities, however, warn that ”the recovery in the yellow metal remains on shaky ground as Fed Chair Powell signalled a willingness to sacrifice some economic growth in an effort to tame inflation, suggesting the Fed is comfortable with more pain before taking the foot off the brake, which should ultimately still weigh on precious metals.”
”In the midst of the latest bounce, the number of traders long the yellow metal remains elevated, while the breadth of traders short has just started to rise from near-record lows, highlighting there is still plenty of positioning to be unwound should the Fed remain steadfastly hawkish.”
US weekly oil inventories -1.019M vs. expectations of -0.737M
- Weekly oil inventory data
- Crude oil inventories -1.019M vs. a draw of -0.737M estimate. The private data released showed a surprise build of 0.600M
- Gasoline inventories -0.482M vs. a draw of -0.634M estimate. The private data showed a larger than expected draw of -4.200M
- Distillates +1.657M vs. expected build of 0.917M estimate.
- Cushing -1.061M vs. last week’s -2.403M
EU News
European major indices close higher on the day
- German DAX, +0.64%. France’s CAC, +0.9%
The major European indices are all closing higher. Preliminary closes are showing:
- Euro stocks index +0.89% at 3679
- German DAX +0.64% at 14012
- France’s CAC +0.90% at 6309
- UK’s FTSE 100 +0.53% at 7524
- Spain’s Ibex +1.44% at 8758
- Italy’s FTSE MIB +1.56% at 24249
In the European debt market, the benchmark 10 year yields are closing mixed:
Other News
Axios: White House senior advisors are on a secret visit to Saudi Arabia
- Looking for a possible arrangement between Saudi Arabia, Israel, and Egypt to increase oil production
Axios is reporting that 2 White House senior advisors are in a Saudi Arabia on a secret visit (although it is not secret anymore) in an effort to persuade Saudi Arabia, Israel and Egypt to increase oil production.
Cryptocurrency News
Ethereum whale scoops up 86.7 billion Shiba Inu while large wallet investors shed SHIB
- Large wallet investors have shed their Shiba Inu holdings recently, however, BlueWhale0073 continued accumulating SHIB.
- The Ethereum whale scooped up 86.7 billion Shiba Inu tokens to their portfolio despite the recent drop in Shiba Inu price.
- Analysts note that Shiba Inu price has moved above the descending trendline and could begin its recovery soon.
Ethereum whales have accumulated Shiba Inu consistently through the meme coin’s bloodbath. While most large wallet investors have shed their Shiba Inu holdings, BlueWhale0073 has scooped up more SHIB tokens for their portfolio.
Ethereum whale increases Shiba Inu holdings
Based on data, a crypto intelligence platform that tracks activity of the 100 largest Ethereum whales, “BlueWhale0073” has added an impressive amount of Shiba Inu to their portfolio.
Large wallet investors recently reduced their holdings of the meme coin, as it plummeted in the recent bloodbath. Despite the volatility in Shiba Inu price, the Ethereum whale identified as “BlueWhale0073,” has scooped up 86.7 billion SHIB tokens.
The whale has bought nearly 90 billion Shiba Inu tokens, worth over $1 million. The whale sold Shiba Inu tokens soon after the purchase. The volatility in the Shiba-Inu-themed cryptocurrency has created opportunities for large wallet investors to trade SHIB in a large quantity.
The whales wallet address currently holds stablecoins USDT and USDC and altcoin, Chainlink.
The top 100 Ethereum whales have decreased their holdings in Shiba Inu from $833 million to $544 million. The recent decline is a driver of bearish sentiment among investors and Shiba Inu holders.
The amount of Shiba Inu tokens held by Ethereum whales has now diminished.
Analysts predict recovery in Shiba Inu price
Analysts have evaluated the Shiba Inu price trend and predicted a recovery in the meme coin. Crispus Nyaga, a leading analysis bullish on Shiba Inu. The analyst notes that Shiba Inu has managed to move above the descending trendline and SHIB is likely to continue its climb.
Nyaga believes the target for Shiba Inu price is $0.000014.