This update follows last week’s earnings reports and the changes they created within the market. Scroll down to see forecasts for this week.
US Market:
After its recent earnings report, Tesla (TSLA) shares were up about +23% for the week, according to data provided by S&P Global Market Intelligence. Even though it is consistently volatile, In the fourth quarter, Tesla’s total revenue grew by 37% year over year, and net income increased by 59%.
Another company to benefit from last week is Meta Platforms (META). According to an early Friday report by the Wall Street Journal, Meta is finally “beginning to see a route to recovery” from the advertising income downturn the business has been experiencing since Apple’s (AAPL) adoption of its app monitoring privacy policy modification.
Following the release, META share prices are nearly +2.5% higher. After a challenging year in 2022, the stock has gained more than 20% since the beginning of 2023. Over this week, Meta rose by almost +9%. The announcement of Meta Platforms’ Q4 financial results is set for Wednesday, February 1, 2023, following the close of business.
Speaking of financial results, the U.S. economy finished 2022 in solid shape even as questions persist over whether growth will turn negative in the year ahead. Fourth-quarter Gross Domestic Product (US GDP), the sum of all goods and services produced for the October-to-December period, rose at a 2.9% annualized pace, slightly better than expected. Growth rate was slightly slower than the 3.2% pace in the third quarter. Consumer expenditure, which makes up over 68% of GDP, rose by +2.1% during the period, a somewhat slower rate than the previous period’s 2.3% gain but still positive.
On a less positive note, Intel’s (INTC) gloomy prediction had caused a ripple across the investing landscape. Over the past couple of years, the term “Worst earnings report in our history of covering this company” was mentioned more than once. However, this time, it really is. Intel’s shares (-7.20%) were expected to start the day at $27.20, about 10% lower, while they were traded around $50 a year ago.
Forex:
In the foreign exchange market, the rupee fell by about 10% against the dollar on Thursday in Pakistan, as the central bank gave up trying to defend its exchange rate in the face of pressure to protect its dwindling foreign reserve. The euro (EURUSD) was -0.23% lower at $1.08895, but not far from the nine-month high of $1.09295 touched on Monday. Against the yen, the dollar (USDJPY) was up +0.54% at 130.275 yen.
Data on Q4 of the Eurozone’s GDP have begun to trickle out, with Spain reporting on Friday that its economy expanded by 0.2% during the quarter, in line with expectations. The three largest economies in the Eurozone – Germany, France, and Italy, are expected to release data this week. The German economy is believed to have stagnated, according to the Deutsche Bundesbank.
Attention now turns to this week’s central bank meetings, including the Federal Reserve and the European Central Bank. Traders broadly expect the Fed to increase rates by 25 basis points (bps) this Wednesday, a step down from a 50-bps increase in December. Meanwhile, the ECB has all but committed to raising its key rate by half a percentage point this week.
Cryptocurrency:
In terms of compliance, the US SEC is looking into registered investment advisors’ adherence to crypto regulations. According to unnamed sources, the SEC is questioning advisors about their compliance with agency guidelines for handling digital assets belonging to clients. The SEC is inquiring from investment advisors regarding the actions taken by their businesses to gain custody of businesses like FTX.
In blockchains, the Solana (SOL/USD) and Cardano (ADA/USD) are two projects that the crypto space is watching as they are the two best candidates to replace Ethereum as the desired decentralized app (dApp) platform. Ranked at number 8 on CoinMarketCap’s list of the cryptos ranked based on market cap, ADA’s price has printed a 24-hour gain and is up +0.66%. As such, ADA is changing hands at $0.3797. Meanwhile, the price of SOL is down -1.85% over the last 24 hours. As a result, its price is currently trading at $13.97 at press time. Solana was one of the projects that was severely affected by the collapse of the crypto exchange, FTX.
Commodities:
In oil, prices reversed earlier gains on Friday as indications of strong Russian oil supply offset better than expected U.S. economic growth data, strong middle distillate refining margins and hopes of a rapid recovery in Chinese demand. Brent futures (UKOIL) were down 51 cents, or -0.6%, at $86.96 a barrel by 16:29 GMT. U.S. crude fell 65 cents, or -0.8%, to $80.37. Both benchmarks rose by more than $1 earlier in the session but are now poised to break a three-week run of gains.
In gold, prices moved little on Friday as metal markets hunkered down before the release of the Federal Reserve’s preferred inflation gauge, while a recovery in the dollar also pressured prices following better-than-expected U.S. economic growth figures. In addition, gold futures inched lower to $1,929.80 an ounce by 02:02 GMT. The instrument sank -0.8% on Thursday and were set to gain about +0.2% this week.
Earnings:
What to watch out for this week
Events:
Earnings:
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