Wall Street emerges in scattered order on Thursday, with the S&P 500 down 0.11% to 3,965 pts and the Nasdaq down 0.32% to 10,896 pts, against an appreciation of 0.21% for the Dow Jones to 34,046 pts . The long-awaited inflation numbers in the United States did not bring any notable catalyst, as they came out globally “in line” with economists’ expectations, materializing a continuation of the deceleration of inflation at an annual rate. On Nymex, a barrel of WTI crude rose 1.3% to settle at $78.4. The ounce of gold takes 0.6% to $1,899. The dollar index fell 0.5% against a basket of currencies.
The US inflation numbers published on Thursday did not bring any major surprises. Thus, the US consumer price index dropped 0.1% in December, compared to the previous month, and rose 6.5% in one year. The consensus was stability in relation to the previous month. Excluding food and energy, the US CPI rose 0.3% from November, in line with the FactSet consensus. The price index increased by 5.7% in one year, excluding food and energy.
The American labor market also confirms its solidity. Jobless claims fell slightly again last week. The US Department of Labor just announced, for the week ended Jan. 7, that jobless claims reached a level of 205,000, down 1,000 from the previous week. The consensus was positioned at 220,000. The four-week average is 215,500, down from 1,750. Finally, the number of unemployed persons compensated in the week ended December 31 reached 1.634 million, a drop of 63 thousand in seven days (consensus of 1.710 million).
Inflation was therefore at the center of concerns this week on the economic calendar with this December consumer price index, but the announcements turned out to be fairly neutral. According to CME Group’s FedWatch tool on Thursday, the probability of a 25 basis point Fed rate hike on Feb. 1 is 93%, compared to a 7% chance of a 50 basis point move. basis points. The federal funds rate is currently between 4.25 and 4.5%.
Also note that the US Treasury Department will announce its December budget deficit tonight at 8 pm. Finally, the news would not be complete without the participation of Fed officials such as Patrick Harker, James Bullard and Thomas Barkin.
Walt Disney (+3%) rose on Wall Street, following the announcement of the appointment of Mark Parker as chairman of the board of directors. Parker has served as executive chairman of Nike and a member of the board of directors of Disney for the past seven years. Parker will succeed Susan Arnold, who will not run again due to Disney policy’s 15-year term limit. He will take over as chairman after the company’s annual shareholder meeting in 2023. Disney also last night recommended that shareholders vote against activist investor Nelson Peltz, who is trying to stake a claim on the company’s board.
Alphabet (stable). In fact, Alphabet’s unit dedicated to life sciences will cut 15% of its workforce and abandon some programs, reports Bloomberg. More than 200 positions are affected by this reorganization, Verily said. “We are making changes that enhance our strategy, prioritize our product portfolio and simplify our operating model,” said Stephen Gillett, CEO of Verily. The Alphabet entity will also discontinue the Verily Value Suite, medical software and some early-stage products such as microneedles for drug delivery.
BlackRock (-1%) is the latest US finance company to cut its workforce as part of broader cost cuts, with plans to lay off around 500 employees. The Financial Times reports that BlackRock plans to cut 500 positions from its global workforce as the world’s largest asset manager grapples with the fallout from the massive market downturn. The job cuts would amount to a reduction of about 2.5% in its total workforce of nearly 20,000 people, about a third of them in the United States.
Taiwan Semiconductor (+6%!), the Wall Street-listed Taiwanese chipmaker, on Thursday announced a nearly 80% rise in its quarterly earnings to TWD296 billion, while strong sales of advanced chips helped to defy a broader industry downturn that hit cheaper core chips. Fourth-quarter revenue increased 27% year-on-year to 625 billion New TWD. Taiwan Semiconductor therefore generated EPS of NT$11.41 in the fourth quarter against the consensus FactSet of NT$11.10. Revenue, which amounted to $19.9 billion, on the other hand, does not match the FactSet consensus and previous guidance of $19.9 billion to $20.7 billion. Operating profit is NT$325 billion compared to a FactSet consensus of NT$319 billion. The 52% operating margin compares to a 49-51% guidance.
Even so, the group is cautious and has just reduced its investment plan for 2023, evidencing the deterioration of demand prospects. TSMC now expects to spend between $32 billion and $36 billion, down from $36.3 billion in 2022, and projects first-quarter revenue in the range of $16.7 billion to $17.5 billion, which would represent a year-on-year decline. However, management says it is convinced of a resumption of activity in the second half, with product launches, including technologies such as artificial intelligence.
T-Mobile US (stable) is considering acquiring Mint Mobile, the low-cost wireless provider backed by actor Ryan Reynolds, according to people familiar with the matter cited by Bloomberg. The second-largest mobile service provider in the United States is said to be in talks with Mint Mobile, said the sources, who asked not to be identified because the matter is not public. No final decision has been made and Mint Mobile may choose to remain independent or sell itself to another party. Ryan Reynolds owns about a quarter of Mint Mobile, which offers cheap cell phone plans on the T-Mobile network starting at $15 a month.
Tesla (-3%). The expansion of Tesla, the Texas-based electric car maker, in Shanghai has been delayed, according to Bloomberg. The agency cites people familiar with the matter, who point out data problems that could curb the American manufacturer’s ambition to continue developing in China. The so-called “phase three” expansion was originally scheduled to start in the middle of the year and would have doubled the plant’s capacity to about 2 million cars a year, Bloomberg sources said, asking not to be identified. are not authorized to speak publicly.
Some Chinese central government officials have expressed concern that a US company connected to Elon Musk’s space internet initiative, Starlink, has such a large presence in Asia’s largest economy, the report said. While Tesla cars lack Starlink equipment, which would allow users to bypass the Great Firewall of China, Beijing is increasingly concerned about data security and social stability.
American Airlines jumped 4% on Wall Street after raising its fourth-quarter profit target on strong holiday demand. The US airline now sees adjusted earnings per share for the period ranging from $1.12 to $1.17, versus previous estimates of between $0.5 and $0.7. The consensus would therefore be largely outdated. The group also plans a 16-17% increase in revenue compared to the pre-pandemic fourth quarter of 2019. American Airlines will report its results on Jan. 26.