Pre-market market trends
1. On October 19 (Wednesday) U.S. stock Before the market, the three major U.S. stock index futures fell. As of press time, Dow futures fell 0.35%, S&P 500 index futures fell 0.47%, and Nasdaq futures fell 0.49%.
2. As of press time, Germany DAX index fell 0.16%, the UK FTSE 100 index fell 0.16%, France CAC40 index rose 0.20%, and the European Stoke 50 index rose 0.43%.
3. As of press time, WTI crude oil rose 1.40% to US$83.22 per barrel. Brent crude oil rose 1.02% to $90.95 per barrel.
Market news
US dollar exchange rate against the Japanese yen is approaching 150, and the Japanese government continues to warn of the sharp depreciation of the yen. As of press time, the US dollar-JPY exchange rate approached the important psychological threshold of 150, at 149.63. Japanese authorities reiterated warnings on Wednesday about a sharp decline in the yen against the dollar, with Finance Minister Himchi Suzuki said he was "cautiously" to increase the frequency of exchange rate. Suzuki Town said the government will "response appropriately" in the foreign exchange market according to existing policies. In addition, Bank of Japan Governor Kuroda Haruhiko also reiterated his usual position that the stability of the foreign exchange market is "extremely important" and described the recent weakening of the yen as sharp and one-sided.
Citi : The probability of recession reflected by US stocks exceeds that of other assets, but the risk of pricing is still insufficient. Citi Quantitative Strategist said U.S. stock market prices reflect the possibility of a U.S. recession is higher than any other asset class and may face more losses. Strategists including Alex Saunders wrote in a report dated October 18: "The U.S. stock market reflects the greatest recession risk (but not enough), and earnings expectations need further adjustments. The U.S. bond market has the least pricing risk, but given the hawkish stance of the Federal Reserve , it will take some time for bonds to respond to recession risks." A media survey of Wall Street economists showed that the probability of a recession in the U.S. is 60% in the coming year, up from 50% a month ago. Although, according to Citi, the standard yield curve probability model shows a 34% chance of recession. Economists Eliza Winger and Anna Wong are even more pessimistic, believing that the likelihood of an economic recession in the next 12 months is 100%.
The interest rate for U.S. 30-year fixed mortgage loans climbed to 6.94%, a record high since 2002. The U.S. Mortgage Bankers Association (MBA) data released on Wednesday showed that the 30-year fixed mortgage contract interest rate jumped 13 basis points again to 6.94%, the ninth consecutive month of increase. U.S. mortgage rates continued to climb to 20-year highs, exacerbating the downturn in the real estate market. The association's housing purchase or refinancing application index fell 4.5%, the ninth decline in 10 weeks and remains at its lowest level since 1997.
Euro zone September CPI increased 9.9% year-on-year, slightly lower than expected. Data released by the European Statistics Office on Wednesday showed that the euro zone's consumer price index (CPI) in September increased by 1.2% month-on-month; a year-on-year increase of 9.9%, lower than the previous estimate of a year-on-year increase of 10%. core CPI, excluding energy and unprocessed food, grew 0.9% month-on-month; 6% year-on-year, lower than the previous estimate of 6.1% year-on-year. As inflation is still at a high level, the market expects the ECB to raise interest rates further by the end of the year. The ECB raised a total of 125 basis points in its last two meetings, the fastest tightening of policy on record. Many policymakers have proposed another 75 basis points hike at their Oct. 27 meeting.
UK food prices hit the largest increase in more than 40 years , and the inflation rate returned to double digits in September. Soaring UK food prices pushed UK inflation back to double digits in September, exacerbating pressure on the country's government and the central bank to . The Office of National Statistics announced on Wednesday that the consumer price index rose 10.1% in September, compared with a previous value of 9.9%. That figure is comparable to the 40-year high set in July, surpassing economists' expectations of 10%. Data shows that food prices rose 14.8% from the same period last year, which is also the strongest increase in more than 40 years. Rising furniture and household goods prices were another driving factor, up 10.7% in September.These data put inflation well above the Bank of England’s 2% target, increasing pressure on policymakers to significantly increase key interest rates next month.
Biden 's "wishful abacus": the last batch of oil reserves may be sold at the end of this year, and the crude oil reserves will be supplemented by US$67-72. A senior U.S. administration official said Biden will announce a plan on Wednesday to sell the last part of the U.S. emergency oil reserves by the end of the year and elaborate on strategies to replenish reserves as oil prices fall. Earlier this year, Biden decided to sell 180 million barrels of strategic oil reserves to deal with the possible supply crisis caused by the Russian-Ukrainian conflict. Although the initial plan was to close sales in November, about 15 million barrels remained unsold as summer purchases were lower than expected. The oil will be bid in December and can provide additional oil supply if needed. Biden will also propose plans to supplement emergency reserves in the coming years, provided that WTI crude oil prices are between $67-72 per barrel or less.
stocks message
Procter & Gamble (PG.US) Q1 performance exceeded expectations, but warned that the exchange rate will drag down sales and profits. financial report shows that P&G's net sales in Q1 increased by 1.3% year-on-year to US$20.61 billion, better than the market's expectations of US$20.34 billion; net profit was US$3.939 billion, better than the market's expectations of US$3.867 billion; adjusted earnings per share was US$1.57, slightly better than the market's expectations of US$1.53. The financial report revealed that Q1 sales fell by 3%, representing a second consecutive quarter of decline, showing weak demand. Procter & Gamble expects overall sales in fiscal 2023 to fall by 1%-3% from the previous fiscal year, and maintains its organic sales growth expectation between 3%-5%. The company expects foreign exchange rates to drag down overall sales growth by 6 percentage points in fiscal 2023. The company added that the company's after-tax profit in fiscal 2023 had a negative impact of $3.9 billion due to exchange rate impacts, rising commodity and material costs and rising freight costs. As of press time, P&G's U.S. stocks rose more than 2% before the market trading on Wednesday.
ASML.US (ASML.US) Q3 net sales exceeded expectations by 5.778 billion euros, and the amount of new orders reached a new high. financial report shows that ASMA's net sales of Q3 was 5.778 billion euros, higher than the market's expectations of 5.41 billion euros, and 5.431 billion euros in the previous quarter; net profit was 1.701 billion euros, higher than the market's expectations of 1.42 billion euros, and 1.411 billion euros in the previous quarter; earnings per share was 4.29 euros, compared with 3.54 euros in the previous quarter. The amount of new orders was a record 8.92 billion euros, compared with 8.461 billion euros in the previous quarter. Gross profit was 2.994 billion euros, compared with 2.665 billion euros in the previous quarter; gross profit margin was 51.8%, compared with 49.1% in the previous quarter. Asmay expects net sales in the fourth quarter of 2022 to be between 6.1 billion and 6.6 billion euros, with a gross profit margin of about 49%; the annual sales are expected to be 21.1 billion euros, with a gross profit margin of nearly 50%. Rapid shipments in 2022 will delay revenue recognition to 2023, with the relevant amount being approximately 2.2 billion euros. As of press time, Asmay's U.S. stock market rose more than 5% before the market trading on Wednesday.
Abbott (ABT.US)Q3 sales fell 4.7% year-on-year, raising the annual earnings per share expectations. financial report shows that Abbott's Q3 sales were US$10.41 billion, a year-on-year decrease of 4.7%; net profit was US$1.435 billion, a year-on-year decrease of 31.7%; diluted earnings per share was US$0.81, compared with US$1.17 in the same period last year; adjusted diluted earnings per share was US$1.15, better than the market expectations of US$0.94, and US$1.40 in the same period last year. In addition, Abbott raised its full-year earnings per share guidance for 2022. The company expects full-year diluted earnings per share of $3.75-3.81 (previously expected at least $3.5); adjusted diluted earnings per share of $5.17-5.23 (previously expected at least $4.9). As of press time, Abbott's U.S. stock market fell nearly 2% before the market trading on Wednesday.
Netflix (NFLX.US)'s Q3 performance exceeded expectations in all aspects, and paid users regained their growth momentum. Netflix's Q3 revenue was US$7.926 billion, a year-on-year increase of 5.9%, and the market expects to be US$7.85 billion; diluted earnings per share was US$3.10, a year-on-year decrease of 2.8%, and the market expects to be US$2.12. The net increase of global streaming paid subscription users was 2.41 million, exceeding Netflix's previous expectations and market expectations of 1 million; as of the third quarter, the total number of streaming paid subscribers was 223.09 million, a year-on-year increase of 4.5%, and the market expects to be 221.7 million.In addition, Netflix also expects paid subscription users to grow by 4.5 million in the fourth quarter, with market expectations of 3.9 million. Less than two weeks after
was launched, Apple (AAPL.US) began to reduce the production capacity of iPhone 14 Plus. According to two people familiar with Apple's supply chain, Apple cut production capacity a few weeks after the iPhone 14 Plus was shipped as Apple reassessed demand for the phone. Apple has told at least one Chinese Apple manufacturer to immediately pause production of iPhone 14 Plus components. At this time, the global smartphone market has become weak, with smartphone shipments in the third quarter falling by 9% year-on-year, and demand will not be very high in the next 6-9 months. The people familiar with the matter also said that the two Apple suppliers cut production of iPhone 14 Plus by 70% and 90% respectively. The iPhone 14 Plus was released on October 7, which is cheaper than the iPhone Pro, and the phone goes on sale on October 7. Originally, Apple expected that demand for new phones would be very strong, but unexpectedly, Apple had abandoned its new phone production plan last month.
Important economic data and event preview
Beijing time 20:30 New houses in the United States in September annualized monthly rate
Beijing time 20:30 Canada September CPI annual rate
Beijing time 22:30 United States EIA crude oil inventory changes in the week ending October 14
Beijing time next day 01:00 2023 FOMC vote committee, Minneapolis Fed Chairman Kashkali delivered a speech on "inflation, interest rates and the current situation of the US economy"
Beijing time next day 01:15 US President Biden delivered a speech on energy security
Beijing time next day 02:00 Beijing time next day 02:00 US time next day US President Biden delivered a speech on energy security
Beijing time next day 02:00 The Federal Reserve announces economic status brown book
Beijing time the next day 04:00 US President Biden delivered a speech on the bipartisan infrastructure bill
performance forecast
Thursday morning: Tesla (TSLA.US), IBM (IBM.US), Aluminum (AA.US)
Before the market Thursday: Nokia (NOK.US), Ericsson (ERIC.US), Huaqin Technology (CLPS.US), ATT (T.US), United Pacific (UNP.US), Blackstone (BX.US), Airport (AAL.US)
