Wall Street’s four consecutive sessions of gains will likely not be followed by a fifth one after Meta’s plunge.Facebook’s parent company released disappointing results and outlook, which caused the share to drop 20%.Elsewhere, central banks are taking different approaches to combat rampant inflation.Meta Platforms is still making a lot of money, but which is no longer as serene as it used to.
It published growth forecasts more in line with the old world than the new.
That means relatively low, because TikTok is getting more popular by the day and the change in Apple ‘s privacy policy is putting a strain on Meta’s universal ad pumping model.To add insult to injury, Facebook’s daily active users dropped for the first time in the group’s (relatively) young history between two quarters.By a small number, but this carries heavy symbolism: 1.93 billion active users in Q3 versus 1.929 billion in Q4.
The market was probably right to be wary of valuing Meta less generously than the other digital giants.
In this case, Meta was already under scrutiny for multiple reasons: the use of customer data for commercial exploitation, competition practices, lack of content regulation on its platforms, data leaks, and so on.
All this to say that the rebound of tech stocks will take a bit of a hit today because of Meta, but not only.Spotify (which is Swedish, not American but listed on Wall Street) was losing 10% after the bell after its numbers and the “Joe Rogan effect”, and Qualcomm wasn’t looking too hot either on a somewhat short outlook.There are still plenty of corporate releases today, including Amazon at the close.
In Europe, the Bank of England released its monetary policy decision.It expects inflation to peak at 7.25% in April, due to higher energy prices.
Inflation should then fall back, but still remain at about 5%.As expected, it has decided to raise its key rate by 0.25 percentage points to 0.5%.
“Unfortunately, we’ve got a squeeze from energy prices, and you see the Ofgem announcement this morning, and in order to counter the threat, and the risk that we see of further pressure coming from the labour market, I’m afraid we do have to raise bank rates.” Said BoE Governor Andrew Bailey.
“This is a lot of pressure on households, and we have to be very clear, a lot of pressure on those households who are less able to afford it.”
Also today, the European Central Bank took a different approach and announced that it was keeping its key rates at zero.
However, it is starting to reduce its asset purchase program, with £20 billion of government bonds coming to maturity in March.
Future moderate rate hikes, “if the economy evolves in line with the report’s projections,” are “likely to be appropriate in the coming months,” the minutes state.
Economic highlights of the day:
In the United States, we have new weekly unemployment claims, productivity and wages of Q4, PMI indices, durable goods orders and the ISM services index.
The dollar is down to EUR 0.8785.The ounce of gold is gaining ground at USD 1804.
Oil is slightly down at USD 87.69 for WTI and USD 88.94 for Brent.The T-Bond is yielding 1.77% over 10 years (-1 point).Bitcoin is stabilizing at around USD 37,000 per unit.
On markets:
* Meta Platforms – Facebook’s owner falls 19% in pre-market trading after it issued a lower-than-expected revenue forecast Wednesday, with the group blaming Apple’s privacy changes and competition, including from TikTok.
* Qualcomm – The semiconductor maker reported record sales for the final three months of 2021 on Wednesday night and said it expects sales for the current quarter to beat Wall Street expectations thanks in part to solid demand in China.However, the stock is down 1.7% in pre-market trading.
* Apple , Alphabet – South Korea’s telecom regulator said Thursday it expects Apple and Google’s parent company to come up with proposals that are more in line with the law prohibiting major platforms from imposing their payment systems on developers in order to finalize the law on online app stores.Apple also urged the U.S.Congress on Wednesday not to approve a bill Thursday that would regulate app stores.
* Tesla – The National Highway Traffic Safety Administration (NHTSA) announced Wednesday that it is investigating complaints from motorists about their Tesla vehicles braking without reason.
The automaker also issued a recall of 817,000 vehicles sold in the U.S.for a seatbelt-related problem.Tesla shares are down 2.5% in premarket trading.
* Merck & Co said Thursday it expects sales to grow up to 18% this year from 2021, mainly due to molnupiravir, its COVID-19 treatment.
* Biogen said Thursday it expects this year’s profit to fall short of analysts’ expectations due to expected weak sales of its Alzheimer’s treatment as the U.S.health agency CMS limits the number of patients who can receive the treatment.The stock is down 3.4% in pre-market trading.
* Eli Lilly reported better-than-expected quarterly earnings on Thursday, thanks in part to strong sales of its diabetes drug Trulicity and its antibody treatments for COVID-19.
* Johnson & Johnson – The company announced Wednesday that it plans to take a $610 million charge in its first-quarter financial statements related to the discontinuation of bermekimab, a treatment for skin diseases.
* Ralph Lauren raised its full-year forecast Thursday after adjusted quarterly profit beat analysts’ expectations, sending the stock up 7% in premarket trading.
* Metlife – The insurer on Wednesday reported adjusted earnings and revenue for the last three months of 2021 that beat analysts’ expectations.
* T-Mobile US – The telecom operator reported better-than-expected quarterly profit on Wednesday and said it expects to sign up five million more subscribers this year.The stock jumped 7.4% in premarket trading.
* British media and telecommunications group BT Group said Thursday it has opted to enter into exclusive talks with Discovery to create a joint venture between BT Sport and Eurosport instead of exiting the sports business by selling its subsidiary to DAZN, which had made an offer.
* Spotify – The Swedish music streaming group said Wednesday it expects subscriber numbers for the current quarter to be below Wall Street expectations.
The stock drops 9% in trading before the New York Stock Exchange opens.
* Best Buy announced Thursday that it has signed an agreement with Amazon to use AWS, the online retail giant’s cloud infrastructure.
* Novavax – Germany’s vaccine commission, announced Thursday that it recommends the U.S.company’s COVID-19 vaccine in adults.
Britain also approved the vaccine for use in adults.Novavax shares gained 3% in pre-market trading.
Analyst recommendations:
Advanced Micro Devices : Punto Casa de Bolsa upgrades to buy from hold.PT up 14% to $140 Amazon : UBS keeps Buy rating.Previously set at USD 4700, the target price is lowered to USD 4550.
Alphabet C: UBS is keeping its Buy rating.The target price differs slightly and is now set at USD 3900 versus USD 3800.Bunzl : Goldman Sachs downgrades from neutral to sell targeting GBp 2650.C.H.
Robinson : Stifel upgrades to buy from hold.PT up 15% to $106.Electronic Arts : Barclays adjusts price target to $127 from $152, keeps equalweight rating Exelon : RBC Capital Markets downgrades to sector perform from outperform.PT up 7.3% to $46.Exxon : Argus upgrades to buy from hold, sets $92 price target General Motors : Citigroup adjusts price target to $100 from $96, reiterates buy rating Gilead Sciences : Morgan Stanley adjusts price target to $69 from $72, keeps equalweight rating Meta Platforms : Mirae Asset Daewoo moves to trading buy from buy.
PT up 10% to $356 NXP Semiconductors : KeyBanc adjusts price target to $260 from $255, keeps overweight rating Sirius XM Holdings : Barrington adjusts target price to $7.50 from $8, maintains outperform rating Starbucks : Cowen adjusts price target to $115 from $125, keeps outperform rating United Parcel Service : UBS adjusts price target to $274 from $266, maintains buy rating Vodafone : JP Morgan is positive on the stock with a Buy rating.Previously set at GBp 165, the target price has been raised to GBp 170.W.R.
Berkley Corporation : Wolfe Research upgrades to outperform from peerperform.PT up 21% to $106
Receive by email Stocks mentioned in the article Change Last 1st jan.ADVANCED MICRO DEVICES, INC.
2.93% 123.6 -14.11% ALPHABET INC.0.14% 2865.86 -1.08% AMAZON.COM, INC.13.54% 3152.79 -5.44% APPLE INC.-0.17% 172.39 -2.92% AUSTRALIAN DOLLAR / BRITISH POUND (AUD/GBP) -0.50% 0.5225 -2.05% BARCLAYS PLC -1.81% 200.75 7.27% BEST BUY CO., INC.
-0.28% 96.83 -4.69% BIOGEN INC.0.62% 221.53 -7.67% BITCOIN (BTC/EUR) 0.11% 36310.897896 -11.35% BITCOIN (BTC/USD) 0.10% 41567 -10.75% BRITISH POUND / US DOLLAR (GBP/USD) -0.51% 1.3528 0.51% BT GROUP PLC 2.71% 191.1 13.51% BUNZL PLC -0.44% 2716 -5.75% C.H.ROBINSON WORLDWIDE, INC.-0.93% 88.73 -17.56% CANADIAN DOLLAR / BRITISH POUND (CAD/GBP) 0.00% 0.578952 -0.85% CANADIAN DOLLAR / US DOLLAR (CAD/USD) 0.04% 0.783 -0.30% CITIGROUP INC.
2.05% 66.08 9.42% DISCOVERY, INC.-0.10% 28.9 22.77% ELECTRONIC ARTS INC.0.31% 137.71 4.40% ELI LILLY AND COMPANY -1.04% 242.27 -11.37% EURO / BRITISH POUND (EUR/GBP) 0.60% 0.84606 0.10% EURO / US DOLLAR (EUR/USD) 0.01% 1.1447 0.58% EXELON CORPORATION -0.62% 43.52 6.41% EXXON MOBIL CORPORATION 2.17% 81.41 33.04% GENERAL MOTORS COMPANY -3.43% 51.29 -12.52% GILEAD SCIENCES, INC.-2.28% 63.9 -12.00% INDIAN RUPEE / BRITISH POUND (INR/GBP) 0.00% 0.009903 -0.72% INDIAN RUPEE / US DOLLAR (INR/USD) 0.00% 0.013398 -0.23% JOHNSON & JOHNSON -0.65% 171.63 0.99% LONDON BRENT OIL 1.93% 92.74 16.81% MERCK & CO., INC.
-0.57% 78.56 2.51% META PLATFORMS, INC.-0.28% 237.09 -29.51% METLIFE, INC.1.86% 68.99 10.40% MORGAN STANLEY 1.78% 104.11 4.21% NEW ZEALAND DOLLAR / US DOLLAR (NZD/USD) -0.75% 0.66138 -2.52% NOVAVAX, INC.0.95% 89.33 -37.56% NXP SEMICONDUCTORS N.V.-0.11% 198.12 -13.02% QUALCOMM, INC.0.21% 179.47 -1.86% RALPH LAUREN CORPORATION 0.81% 118.63 -0.19% S&P 500 0.52% 4500.53 -5.57% S&P GSCI CRUDE OIL INDEX 1.55% 505.919 22.74% SIRIUS XM HOLDINGS INC.
1.65% 6.78 6.77% SPOTIFY TECHNOLOGY S.A.9.18% 174.43 -25.47% STARBUCKS CORPORATION -0.98% 95 -18.78% T-MOBILE US 0.13% 120.94 4.28% TESLA, INC.
3.61% 923.32 -12.63% UBS GROUP AG -0.74% 18.69 13.82% UNITED PARCEL SERVICE INC -1.71% 224.79 4.88% US DOLLAR / BRITISH POUND (USD/GBP) 0.00% 0.739208 -0.51% VODAFONE GROUP PLC 0.85% 134.72 19.56% W.R.BERKLEY CORPORATION 0.92% 89.76 8.95% WTI 2.02% 91.949 19.61%.
