Wall Street is still closing deep on fears of a fall recession of the United States. Many are beginning to accuse the Federal Reserve of waiting too long to reduce rates. The fear is that the possible reduction in the cost of borrowing in September will not prevent the onset of recession. And so the Dow Jones is closing up 1.5%, the S&P500 up 1.8% and the Nasdaq up 2.4%.
3:30 p.m. US stock markets fell sharply after unemployment figures of 4.3%. Five stocks to track
Wall Street opens the August 2 session with a sharp decline, after the previous day’s sell-off. At 3.30pm the Dow Jones fell 1.2%, the S&P fell 1.7% and the Nasdaq lost 2.5%. Red confirms profit-taking after the Fed’s confirmation of a rate cut in September, an event already discounted by the market. Adding to the picture were disappointing macro data on the manufacturing PMI index and the American labor market, which highlighted an increase in the unemployment rate to 4.3%.
“We currently consider recessionary fears premature, as the negative data in the ISM contrasts with the positives in American GDP growth which stood at +2.8% in the second quarter”, said UBS strategists. “These numbers suggest the US economy is headed for a soft landing rather than a recession,” the analysts concluded.
Treasury yields fell after the Fed meeting and a series of negative macroeconomic data. The 10-year government bond is at 3.84%. The euro-dollar exchange rate rose 1% to 1.09. Brent and WTI fell 2.7% and 3.1% respectively.
1. Contract of sales for Amazon
At 3:30pm the title of Amazon lose 10%. The e-commerce giant’s quarterly earnings were growing, but fell short of expectations and the company expects a further slowdown in the third quarter. The company founded by Jeff Bezos closed the three months ended June with a turnover of 147.98 billion, compared to 134 billion in 2023, but below the 148.56 billion expected by analysts. Online platform sales grew 5% compared to a 7% increase last quarter. Although growing, the quarter’s performance did not convince the market. What worries analysts is the weak guidance the company has given for the rest of the year. The technology giant expects turnover between 154 and 158.8 billion for the third half of the year.
The slowdown in sales This can be attributed in part to the fact that consumers continue to be cautious about spending. CEO Andy Jassy said consumers are buying cheaper items, meaning there is a lower average selling price on the products sold. “More discretionary and expensive items like computers, electronics or TVs are growing faster for us than we see elsewhere in the industry, but slower than we see in a more stable economy,” he explained. said Jassy.
2. Apple beating financial expectations but losing ground in China
The actions of Apple they gained 2.3% at 3.30pm after the tech giant reported better-than-expected quarterly results, despite a slight decline in iPhone sales and the continued erosion of market power in China . The Cupertino company reported revenue of $85.78 billion, up 5% from a year ago, beating analysts’ estimates of $84.53 billion. Services, which include revenues from Apple shop, Apple pay, Apple TV+, Apple music, Apple Arcade and iCloud remained the most profitable segment, contributing 28% of total revenue and growing 14.1% to 24.21 billion.
However, the biggest revenue contributor, iPhone sales, fell 1% from last year, mainly due to the continued decline in China. Apple has lost further market share in the country due to strong competition from local rivals and the weakening of the spending power of citizens.
3. The splash of Intel it infects all chip manufacturers
At 3:30pm the title of Intel it is in free fall of 28% after closing the last session at -5.5%. The company closed the quarter in the red, posting a net loss of 1.61 billion compared to a net profit of 1.48 billion ($35 per share) a year earlier. Adjusted EPS stood at just 2 cents per share, far from the 10 cents analysts had estimated. Turnover also fell, marking a 1% drop in the second quarter of 2024 to 12.83 billion. The next few months also look tough for the company. Intel in fact, it estimated a net loss of 3 cents for the third quarter, with a turnover between 12.5 and 13.5 billion, disappointing market estimates. The poor results and forecast caused panic in the markets about the future evolution of the entire sector, dragging semiconductor stocks lower around the world.
- Also read: Semiconductors, Intel crashes on Wall Street and drags the entire sector down. The reasons for the decline
4. Chevron: decreasing refining margins
The title of Chevron down 2.3% at 3.30pm. The oil company reported second quarter results, which missed Wall Street estimates due to industrial pressure from investors. refining margins less and according to natural gas prices. The company had previously warned that oil production would drop last quarter and that the closing of two refineries in California would affect the division. Chevron reported a profit of 4.4 billion, equivalent to 2.43 dollars per share, compared to 6 billion dollars last year. Revenue rose 4.7% to 51.18 billion, higher than expected. Chevron it is not the only one to suffer from declining refining margins. Other major oil groups, such as Shell and BP, also earned less by selling fuel in the second quarter after two years of stellar profits and having to increase production for a demand that did not ever fulfilled.
The group Chevron The Corp also said it plans to move its headquarters to Houston from San Ramon, California as part of the company’s strategy to cut costs.
5. Nvidia it fights on two fronts: the market and the government
At 3:30 pm the sharing of Nvidia they lose 2.5%, carried by the effect Intel. In addition to selling chip stocks that affect the entire sector, Nvidia It also faces the US Department of Justice opening an antitrust investigation against the semiconductor maker to verify complaints of alleged abuse of a dominant market position for artificial intelligence chips.
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