US core PCE increased by 2.8% in March, exceeding expectations
Technology giant’s strong financial report, Alphabet achieves the best daily increase since 2015
Oil prices have ended two consecutive weeks of decline, with a cumulative increase of 2% this week
As the market weighed the latest inflation data and strong corporate financial reports, the US stock market rose overall on Friday, with the technology sector leading the way, and the Nasdaq achieving its best daily gain since February.
As of the close of the day, the entire US stock market closed higher. The Dow Jones Industrial Average rose 153.86 points, or 0.40%, to close at 38239.66 points; The Nasdaq rose 316.14 points, or 2.03%, to close at 15927.90 points; The S&P 500 index rose 51.54 points, or 1.02%, to close at 5099.96 points.
Popular Chinese concept stocks generally rose, with the Nasdaq China Golden Dragon Index closing 2.45% higher. Xiaopeng Automobile rose 10.73%, NIO rose 8.72%, Ideal Automobile rose 6.69%, JD.com rose 6.12%, Bilibili rose 4.96%, New Oriental rose 4.55%, iQiyi rose 3.53%, and Pinduoduo rose 2.80%.
This week, the Dow Jones Industrial Average has risen 0.7%, the Nasdaq has risen 4.2%, and the S&P 500 has risen 2.7%. Among them, the S&P 500 index and the Nasdaq both achieved their best weekly performance since November last year.
In terms of the bond market, influenced by inflation data, the 10-year US Treasury yield fell by 4 basis points to 4.667%, while the two-year US Treasury yield slightly dropped to 4.987%.
US core PCE increased by 2.8% in March, exceeding expectations
In terms of economic data, according to the latest data released by the US Department of Commerce, the personal consumption expenditure (PCE) price index in the US increased by 0.3% month on month in March, which was consistent with expectations and the previous value was 0.3%; YoY growth of 2.7%, expected value of 2.6%, previous value of 2.5%. After excluding volatile food and energy prices, the core PCE price index in the United States increased by 2.8% year-on-year in March, with an expected value of 2.7% and a previous value of 2.8%; A month on month growth of 0.3% remained unchanged from previous values and expectations. US inflation in March showed almost no signs of easing. In the initial reading of US GDP for the first quarter released this Thursday, inflation in the first quarter also exceeded expectations. The PCE index increased by 3.4%, while the core PCE price index increased by 3.7%.
According to the CME Federal Reserve observation tool, the market expects a 97% probability that the Federal Reserve will remain inactive in May and an 88% probability that interest rates will remain unchanged in June.
In April, the University of Michigan Consumer Confidence Index decreased by 2.2 points to 77.2, slightly lower than market expectations of 77.9. Although the changes were not significant, consumer survey director Joanne Hsu stated that since January, the consumer confidence index has remained stable in a narrow range of 2.5 points, far below the 4.8 points that require statistically significant differences. But while consumers are waiting for the upcoming presidential election, they still show uncertainty about the future economic trajectory. However, there is currently no evidence to suggest that global geopolitical factors are the primary concern for consumers. Consumer inflation expectations for next year have risen from 2.9% to 3.2%, and long-term expectations have risen from 2.8% to 3%.
Technology giant’s strong financial report, Alphabet achieves the best daily increase since 2015
On the company side, boosted by strong financial reports, the stock price of Google’s parent company Alphabet rose by over 10%, marking the best daily increase since July 2015. The company’s first quarter profits and revenue exceeded expectations, and announced its first dividend and a $700 million repurchase plan. The company also stated that revenue increased by 15% year-on-year, which is the fastest growth rate since 2022. Alohabet’s stock price has risen by over 22% so far this year.
Also boosted by strong financial reports, Microsoft’s stock price rose 1.82% to close at $406.32 per share. The company’s performance in the third quarter exceeded expectations, and the Azure business continued to maintain growth momentum.
The stock price of Snap, the parent company of social media platform Snapchat, surged 27.63% to close at $14.55 per share. The company made a profit of 3 cents per share in the first quarter, achieving a revenue of $1.19 billion and a global daily active user base of 422 million, with an average revenue of $2.83 per user, both exceeding expectations. The company’s revenue increased by 21% year-on-year in the first quarter, with advertising revenue of 1.11 billion US dollars. Snap expects its revenue to be between $1.23 billion and $1.26 billion in the second quarter, exceeding analyst expectations; The adjusted EBITDA will be between $15 million and $45 million.
According to the performance released by oil giant Chevron, the company earned $2.93 per share in the first quarter, exceeding expectations and achieving revenue of $48.72 billion, which fell short of market expectations. Part of the reason for the decrease in profits is due to the decline in natural gas prices and the decrease in sales profit margins. Since the beginning of this year, oil prices have risen by over 16%, and gasoline futures prices have risen by 31%, but the impact of the upward trend on profits is limited. Due to oversupply, natural gas prices have fallen by 37% this year. Chevron’s stock price rose slightly by 0.37% to close at $165.89 per share.
According to the results released by ExxonMobil, the company’s earnings per share in the first quarter were $2.06, lower than expected, and achieved revenue of $83.08 billion, exceeding expectations. ExxonMobil’s earnings for the US stock market in the first quarter decreased by 28% year-on-year. The CEO of the company stated that the performance was in line with the company’s plan, and non cash tax and inventory adjustments resulted in lower than expected profits. ExxonMobil fell 2.78% and closed at $117.96 per share.
Mobileye Global, an autonomous driving technology company, fell 5.5% to close at $29.20 per share. Morgan Stanley analysts have downgraded the company’s stock rating from “wait-and-see” to “underweight”, with a target stock price lowered from $26 to $25.
Oil prices have ended two consecutive weeks of decline, with a cumulative increase of 2% this week
In the commodity market, due to inflation data, crude oil futures prices have risen, ending a two-week decline. The WTI crude oil futures for June delivery rose 0.3% to close at $83.85 per barrel. WTI oil prices have accumulated a 2% increase this week. The Brent crude oil futures for June delivery rose 0.6% to close at $89.50 per barrel, with Brent crude oil up a cumulative 2.5% this week.