HK Weekly Recap & Analysis March 27th, 2023
KEY ECONOMIC DATA RELEASES TO WATCH
MARKET RECAP FROM THE PREVIOUS WEEK
March 20, 2023
Amazon is laying off 9,000 workers. Most jobs are being cut in Amazon’s cloud computing, human resources, advertising, and Twitch.
First Republic Bank was being halted on circuit breakers and down 45%.
JPMorgan is advising First Republic on strategic alternatives, including capital raise.
Bed Bath & Beyond plans to hold a special meeting of shareholders to seek approval for carrying out a reverse stock split at a ratio of 1-for-5 to 1-for-10.
Amazon's $1.7 billion purchase of iRobot may be challenged by the US Federal Trade Commission.
FDIC: Bids on Silicon Valley Private Bank are due by March 22, 2023, and bids on Silicon Valley Bridge Bank are due by Friday, March 24, 2023.
UBS Reportedly In Talks to Acquire Credit Suisse
Housing affordability has hit an all-time low, per TrueInsights
Intraday Change for Indices:
S&P 500 +0.96%
Dow Jones +1.19%
Nasdaq +0.20%
March 21, 2023
Sweden's Alecta has sold an entire stake in First Republic Bank for a $727 million loss
Microsoft announced that its new AI-enabled Bing will now allow users to generate images with Bing Chat using OpenAI's DALL-E
US Existing Home Sales Actual 4.58M (Forecast 4.2M, Previous 4.00M)
US Existing Home Sales change Actual 14.5% (Forecast 5%, Previous -0.7%)
Google has officially started opening up limited access to its ChatGPT competitor Bard
US Treasury Secretary Yellen on banking:
Despite recent pressure, the banking system is sound.
I am committed to taking actions that will mitigate financial stability risks.
It is necessary to ensure that the Federal Reserve can provide the liquidity banks require.
Bonuses for staff at Credit Suisse have temporarily been suspended
If the capital raise fails, First Republic Bank is considering downsizing options
The Senate Banking committee will hold a hearing on the SVB collapse on March 28.
SVB'S loans to insiders tripled to $219 mln before it failed
White House: Biden's priorities have been strengthening the banking system and protecting depositors.
Gamestop Earnings
4Q EPS $0.16, est -$0.13
Sales $2.23B, est $2.18B
Nike Earnings
EPS $0.79, est $0.55
Sales $12.40B, est $11.47B
Intraday Change for Indices:
S&P 500 +1.31%
Dow Jones +1.03%
Nasdaq +1.43%
March 22, 2023
SoFi checking and savings members will be able to protect deposits with up to $2 million of FDIC insurance, up from the standard $250K
US Senator Warren has asked the Fed to crack down on large regional banks
US Treasury Secretary Yellen says taxpayers will not be bearing costs related to failed banks and the US banking system is sound
FOMC decides to hike rates by 25bps
US Interest Rate Decision Actual 5% (Forecast 5%, Previous 4.75%)
Fed Chairman Jerome Powell’s Comments:
Isolated banking problems, if left unaddressed, can threaten the banking system; that’s why we took decisive action.
Our lending programs effectively meet banks’ needs and show ample liquidity is available.
All depositors' savings are safe.
The process of getting inflation back down has a long way to go
We will make meeting-by-meeting decisions based on the totality of the data.
Participants only see rate cuts this year within our baseline expectation. If we need to raise rates higher, we will.
US Bondholders prepare to sue swiss over $17 bln Credit Suisse wipeout
Indeed is laying off 2,200 people, 15% of its workforce
Intraday Change for Indices:
S&P 500 -1.70%
Dow Jones -1.67%
Nasdaq -1.36%
March 23, 2023
US Initial Jobless Claims Actual 191k (Forecast 197k, Previous 192k)
US Continued Jobless Claims Actual 1.694M (Forecast 1.6904M, Previous 1.684M)
Block is down 20% after a Hindenburg Research report shows inflated metrics and fraud against consumers
Coinbase is down over 15% after receiving a potential lawsuit from SEC
US New Home Sales - Units Actual 0.64M (Forecast 0.6495M, Previous 0.670M)
US New Home Sales Change MoM Actual 1.1% (Forecast -3.1%, Previous 7.2%)
Credit Suisse set the Euro Note tender consideration amount at €2 billion.
Accenture announced 19,000 job cuts, and their stock went up 7.1%
Ford is projecting a $3 billion loss on EVs in 2023
OpenAI’s ChatGPT can now browse the internet with certain plug-ins
US Treasury Secretary Yellen:
A failure to raise the debt ceiling would lead to a recession or worse.
A debt default would weaken the dollar's reserve currency status.
Intraday Change for Indices:
S&P 500 +0.27%
Dow Jones +0.21%
Nasdaq +1.19%
March 24, 2023
US S&P Manufacturing PMI Flash Actual 49.3 (Forecast 47, Previous 47.3)
US S&P Services PMI Flash Actual 53.8 (Forecast 50.3, Previous 50.6)
US S&P Composite #PMI Flash Actual 53.3 (Forecast 49.5, Previous 50.1)
Fed’s Bullard:
Abandoning the 2% inflation target would be a "disaster," sending the world back to the 1970s.
The United States banking system is still robust, resilient, and in perfect shape.
In response to the strong economy, the 2023 terminal rate was raised by 25 basis points to a range of 5% to 5.75%, assuming financial stress subsides.
Intraday Change for Indices:
S&P 500 +0.66%
Dow Jones +0.46%
Nasdaq +0.37%
THE WEEK AHEAD & EARNINGS
Monday – 03/27/2023
Fed Gov. Jefferson speaks - 5 PM ET
AM Earnings: Express (EXPR), BioNTech (BNTX), H World Group (HTHT)
PM Earnings: PVH Corp (PVH), Noah Holdings (NOAH), Excelerate Energy (EE), Gold Royalty Corp (GROY)
Tuesday – 03/28/2023
Advanced U.S. trade balance in goods - 8:30 AM ET
Advanced retail inventories - 8:30 AM ET
Advanced wholesale inventories - 8:30 AM ET
S&P Case-Shiller home price index (20 cities) - 9 AM ET
FHFA home price index - 9 AM ET
U.S. consumer confidence - 10 AM ET
Fed Gov. Barr testifies to Senate on banks - 10 AM ET
AM Earnings: Walgreens Boots Alliance (WBA), McCormick & Co (MKC), TD SYNNEX (SNX), Elbit Systems (ESLT), Futu Holdings (FUTU), Core & Main (CNM), Evotec SE (EVO), Leonardo DRS (DRS), IHS Holding (IHS ), Lovesac Company (LOVE)
PM Earnings: Micron Technology (MU), lululemon (LULU), Jefferies Financial Group (JEF), nCino (NCNO), Cal-Maine Foods (CALM), Progress Software Corp (PRGS), Dave & Buster (PLAY), SomaLogic (SLGC)
Wednesday – 03/29/2023
Pending U.S. home sales - 10 AM ET
Fed Gov. Barr testifies to House on banks - 10 AM ET
AM Earnings: Cintas Corp (CTAS), Paychex Inc (PAYX), Unifirst Corp (UNF), Kingsoft Cloud Holdings (KC), Sharecare (SHCR), UP Fintech Holding Limited (TIGR), bluebird bio (BLUE)
PM Earnings: Concentrix Corporation (CNXC), Verint Systems (VRNT), RH (RH), H B Fuller Company (FUL), Sprinklr (CXM), Semtech Corp (SMTC), Planet Labs PBC (PL), Franklin Covey Company (FC)
Thursday – 03/30/2023
GDP (2nd revision) - 8:30 AM ET
Initial jobless claims - 8:30 AM ET
Continuing jobless claims - 8:30 AM ET
Boston Fed President Collins speaks - 12:45 PM ET
AM Earnings: Neogen Corp (NEOG), Atour Lifestyle Holdings (ATAT), Altus Power (AMPS), AngioDynamics (ANGO)
PM Earnings: Braze (BRZE), Rumble (RUM), BlackBerry (BB), IonQ, Inc (IONQ), Aehr Test System (AEHR), Arco Platform Limited (ARCE)
Friday – 03/31/2023
Personal income (nominal) - 8:30 AM ET
Personal spending (nominal) - 8:30 AM ET
PCE index - 8:30 AM ET
Core PCE index - 8:30 AM ET
PCE (year-over-year) - 8:30 AM ET
Core PCE (year-over-year) - 8:30 AM ET
Chicago Business Barometer - 9:45 AM ET
Consumer sentiment (final) - 10 AM ET
Fed Gov. Waller speaks - 10 AM ET
New York Fed President Williams speaks - 3:05 PM ET
Fed Gov. Cook speaks - 5:45 PM ET
AM Earnings: I-MAB (IMAB), Consolidated Water (CWCO)
