Exchange week with Peter Pushkarev – 04/18/2023. Reporting of the 1st quarter of 2023 in the US market: so far positive. J.P. Morgan Chase and Bank of America report.
Report of other US issuers. Economic recovery in China. International Energy Agency report: Demand for petroleum products is expected to grow. Expectations from the Fed meeting on May 3 and the prospects for raising interest rates.
Questionable rate of inflation reduction in the US and Europe. Petr Pushkarev on topics that make sense for traders and investors to pay attention to.
So, friends, the main events of this spring have begun on Western exchanges, and it is possible that they determine the dynamics of movements and until the end of the year this is the reporting season for corporate reporting for the first quarter, of course, many people have been waiting for not only what the results will be, but also what forecasts the companies will give its profit for the rest of the year but actually starts everything from the banking sector from the banking sector perhaps really That’s cool without question I read the same amount of Pimen.
so far It’s really very good very report so powerful here 52% jump in profits for Morgana Chase’s jeep to the level of 4 dollars 10 cents per share, the historically highest revenue of 38.3 billion, respectively, such a sigh of relief escaped from investors, it was with us last Friday, respectively, the value of the banking giant itself jumped by more than 7 percent But this gave such a powerful impetus to the S & P 500 index, it continues and the cession is already included in the prices, as if nothing bad awaits us, investors keep such a Poker Face itself, but at the same time.
This mark of 4,150 plus there are still 20 points higher is not yet given to the broad market and it will probably be higher if it moves higher, this week will be more quiet compared to the events that will unfold further at the end of May, and quieter because, after all, bank statements from some incredible Surprises are no longer expected, and if the profit of large banks, in general, Well, they expected it, taking into account recent events with the original banks of recent claims to all the other banks that actually fell under the distribution, it was recently clear that deposits would flow large banks that the month of March would actually enter as a reporting month that many would make their profits due to high-interest rates Those who have a loan portfolio at lower risk Well, gambling is the largest Bank in this case, it justified the expectations that were assigned to it. But if we take other banks, there is no such an unambiguous picture here.
And we have already seen, in principle, according to reaction 1, even to reports that seem to be good, the reaction is ambiguous. Well, in particular, Bank of America reported on Tuesday Pretty well 94 cents profit versus consensus 81 cents versus 85 cents in the Christmas fourth quarter Well, it would seem like clear evidence that Well, at least the largest loan still use all its opportunities to earn money on a percentage of payments from their customers, however, when they started dive into the details of the report, then the initial growth of almost 3 percent, Bank of America shares jumped, it more or less faded away, the consequences, even into negative territory.
At the time when this video is recorded, the papers left that is, than the date in the details they told us that the total volume of America’s deposits even fell by a couple of percent compared to the last tal 22 years the collection of mission for investment banking services in baby America fell by 20 percent high demand that was enjoyed Trading bonds, that is, fixed income instruments in which investors hide from the problems of possible or already real problems also deals with transaction currencies Raw materials That’s what brought the banks of America the growth of total revenue.
It amounted to this At this moment, a decent amount of 27 percent compared to the same first quarter of 22 years and gave mail a significant part of the revenue of three and a half billion of the total revenue of 26 and 3 tenths with this net interest income is a value that directly shows how much profit the bank receives from accruing interest on loans to its customers; this income has grown by 25 percent; everything is in order. then here are the general Summary figures for how long they began to look at the structure and although the general director of the bank said that the essence of each business segment showed very good results. He said that we were organically rapidly increasing relations with clients, the number of accounts.
However, investors saw that the volume of deposits fell, which caused distortions in that it makes a profit that this is for the most part precisely the sector of guaranteed assets and further already Looking at the details, the shares fell by a couple of percent at the moment when I am now looking at them, respectively, the entire spectrum of results and other banks have already ceased to seem so unambiguous to the market Goldman garden groups initially the first reaction to the release of the data is a drop of 3 percent immediately Here are the first minutes after the release of the report on Tuesday Although It would seem that if it were so formal to look at nothing too bad Yes, a 3 percent drop in ownership than if you look at the results, goldman sachs showed $ 8 79 cents earnings per share the consensus was 8:24 there was a consensus but the emphasis in evaluating these results was on the fact that but here a year ago the earnings were much more it was 10 dollars 76 cents and in fact the decline is very noticeable in the sense that this is the worst quarter the worst of the month from the point of view of exactly the general monetary process.
The revenue did not live up to expectations did not reach noticeably expectations were in the region of 13 billion came out 12 and 2 tenths, that is, it is significantly lower, it is also lower than a year ago Although this is better than the cost of the previous quarter, therefore to say that well, the report is definitely weak, I would not say, however, the reaction is in the form of a decrease in shares Well.
I would even call it somewhat unusual. she earned fewer commissions there. And when comparing precisely these moments, the market went down, too, and subsequently began to behave inconsistently, that is, having gone down, first to win back at the moment, again, when I now record minus 2 percent, but you can call the reaction to the bank report now according to for the most part, such a chatter of its own. This is a chatter instead of reacting more or less unequivocally to the positive where it is from the positive and even where the market seems to have found a negative. In the case of Ax, there is also no unambiguous reaction for a long time at the sight of this, and even GP Mo has somewhat suspended paper Rostov, at least for the first two days of the new week, did not add anything to this growth, that is, in general, the banking sector, which, according to large banks, should have been assessed as without problems.
The sector is estimated as long as the slopes of the sector, respectively, there is not a single market dynamics yet another company from which only good things were expected is Johnson Johnson, and in fact, objectively, in terms of indicators, exactly what is good is. If you look at the maximum results there, the last ones that were there, Johnson and Johnson showed both the best numbers in earnings per share and the best numbers in terms of revenue, that is exceeded expectations It would seem that everything is fine there in all areas of the sale of drugs against cancer in particular And a lot of things are mentioned there that should not seem to raise questions.
However, since Johnson and Johnson already decently rose a couple of weeks ago on positive expectations Did not continue for two and a half percent immediately after the release of the report, that is, where, in principle.
They did not seem to expect a catch, and formally this catch and there seems to be no assessment of any poses of the company itself, however, as you can see, there is also an ambiguous reaction Although it even corrected its expectations on profit for this year in the upward direction, that is, in the positive direction, again, the company itself But this adjustment did not give, nevertheless, the movement of such a clearly positive forecast did not change.
So much Yes, maybe the market was waiting for more, perhaps the explanation lies in it’s either the previous advance plus some nervousness, nevertheless, it definitely beat its maximum values.
The countries that have given theirs, respectively, have already transferred it to Ukraine there. I personally think, from the point of view of investments, there may be no such concepts of morality without us. interestingly, everything that is visible in the report is seen by the market as positive and jumped to new historical highs in the price of the share; for the first time, they are traded above $ 500 per share from those companies that did not report noticeable in the window version made by NVIDIA after the bank increased its position through BC in relation to this company before purchases From the previous position, where they believed that it was bought a few kopecks and could be reduced.
Meaning there is a share in the portfolio, they saw, so to speak, some new estimates of the possibility of a chatbot in artificial intelligence that Will order more chips, respectively, in this case anyway, the dynamics for those companies that I named Nowhere In fact, it was absolutely unambiguous, except for the case of GP Morgan Chase, respectively, remains And the uncertainty, again, at the moment when I will make this record, the netflix report is still unknown, but netflix is certainly not decisive, as it were for the average market temperature in the hospital, but this is a fairly significant issuer here, again, it’s hard to expect bad things lately, it has increased in terms of subscribers, it has increased subscription fees where it eliminated sharing.
It began to take small amounts and, accordingly, failed. It seems that we will see this process from the report, but in general, comes the number of few companies that I took into my portfolio a long time ago and I think that this is the backbone for which the market is held in these bones, in particular, Google is included in Apple for me, while Amazon is not included there at the moment, simply because the main business associated with the supply of online goods is this the main one fades and Amazon himself said this many times, but even the shares of Mason as a technology giant have surfaced somewhat not as great as Google’s, but nevertheless, based on the information that Amazon will provide the ability to create chatbots through its platform.
So that companies will be able to use in fact, the calculated capabilities of Amazon in order to create their own business chats, create their own, generate images, that is, without purchasing scarce technologies for this directly, in fact, renting these areas from Amazon. This is where these papers actually jumped up. Boeing still feels good, which does not last long fell down, so to speak, on news about difficulties with certain suppliers. But this is most likely such news that does not speak much in terms of dynamics; nevertheless, they are waiting for an increase in orders and already an increase in deliveries for the next year will indicate, accordingly, in my opinion, this company, which, regardless of the results of reporting, is such the hidden tiger is ready for what he could not say about the rest of the market as a whole Yes, there are positive moments that support the whole picture now afloat, and among such moments, in particular, the recovery in China.
We see China’s GDP in the first quarter grew by four and a half percent on an annualized basis, this is higher than expected by 4 percent, in particular, a company selling luxury goods lvmh That is, this is Lew Sweetton Hennessy, a company that belongs to a particular Tiffany diode, it reported that it increased its revenue and increased profits and also rose to new historical highs, mainly on sales from China Well, the sect of luxury in general, especially the thing I said about this before, that this is also a kind of protection, this is such a refuge where richer investors try to invest, including in these items with precious stones in items that But for them are not so difficult in terms of buying not to buy Here But nevertheless, yes, that is, I know that the prices only for all these luxury items will subsequently be more expensive, they are invested in this segment, and therefore, for food with discount companies such as waves from which the lowest average check, on the contrary, is usually on the horse’s waiting period crises turn out to be such companies.
Well, you can’t say such as because it’s generally the only one the other day there was news that, in fact, its founder is now on the list as number one among multibillionaires. Well, the moment when they asked for shares of some companies such as Microsoft, for example, yes Or Tesla is cheaper than one and a half ago, respectively, in this case, lmh attracted attention from this side, and growth from China is not called support, this is also here, of course, one must understand to some extent supports the level of oil prices, again, the report which came out from the international energy agency showed that an increase in demand for petroleum resources is expected for gasoline in 23.
That is, here is a combination of production cuts, the decision that was taken by OPEC, along with the fact that here a record increase in demand is possible; together, this keeps the still high oil afloat prices That is, even if in the event of a recession the consequences can go lower at the moment The vector of oil is still directed upwards And this, accordingly, puts pressure in the form of cost on the contrary on the costs of most companies, preventing them from making money naturally, the question is how significant or not significant this factor will be According to the reporting for the first quarter, we will not see this, in fact, because April did not rise in price.
But to what extent the previous combination of factors has already affected or did not affect the profit for the first quarter, and in anticipation of most companies in the industrial sector of the service sector, this is all we are just starting to look at everything will unfold literally soon in our eyes, as for the final figures on inflation that came out in America, but I would n’t really have a video here of some kind of relief that they say, formally, inflation there has decreased, by and large, the reduction in inflation is only nominal and only inflation is general But then what is called food inflation, national indicators that do not include energy prices and do not include food prices, they still consider external volatile factors if you look at this particular part of the report yourself, the pipeo consumer price index, the producer index, here But this one, in my opinion, is far from in order to hide the idea of whether inflation is growing with this, it is no coincidence that futures for the Fed’s interest rate of 87 percent show that they will still be raised by another quarter percent on May 3, yes, apparently the last time this year, although there are risks that the Fed will not simply indicate this level, as the final level, will not issue such a forecast, but simply say We have a pause and we will continue to look at the data here everyone understands that the data can change during the year and if it turns out that, for example, energy prices will put pressure upwards on inflation, then even after 36 months of such a pause, it may be resumed raising rates, which is contrary to today’s expectations of the majority of the market That rates can go down, let’s say after the summer or from the fall of our own Fed says that they should not go down there should be a discussion of the minutes, this is a withdrawal, that is, the minutes of the meeting of the past, it showed that some of the participants said that let’s do it pause, we won’t raise rates at all, which means rates were raised, nevertheless, start this percentage, but the poet still part of the participants said that Let’s raise it immediately by half a percentage point, this is such a rather unusual thing in the protocols.
The level below 400, again, yes, it didn’t make a big shock because everyone knows that there are stronger hawks and the Fed and that they dot there on a scatter chart for higher rates, it’s kind of not a surprise, but nevertheless such a reminder in this regard but it really sounded, but also the fact that another 0.4% increase in inflation over the month happened exactly food inflation And inflation fell only in comparison with a very high settlement point a year ago last year, when, in fact, the hot phase of the conflict in Ukraine began and prices jumped instantly for fuel That’s it, compared to too much fuel prices, inflation has now shown a slight decrease, which is natural.
But if we take month by month month by month, this decline has not yet been observed in America, much less observed in Europe, and in this sense, hawkish statements by representatives of central banks not only the Fed here, but even to a greater extent, the ecb, they in particular lead to the fact that the euro against the dollar for the first time reached a level above one ten in a very long period of time and it is still falling down here, but nevertheless the market does not really understand whether it should invest in the dollar to protect against the possible effects of its session or to remain in the European Union because the euro has a greater chance of a further increase in the interest rate, and here is an element of uncertainty just in the currency market, it gives motivation for more market participants to look for exactly those in the stock market which looks the most concretely reliable or looks like the most growing hype on it That’s exactly why the core of the stock market it pops up faster, despite the fact that the average temperature in the hospital is not much higher and at the first opportunity.
At the first threat of some new risks, it falls I guess that this dynamics will continue until the end of the month, but we will see the specifics only based on the corporate reports of the largest companies and small companies of the huge number of companies that make up the s&p 500 and all this is just starting to unfold before our eyes will not be limited to April, so here every day now the reporting season will bring new information for someone confirmation for someone something will come as a surprise Therefore, the case when you need it seems to me to increase the frequency of viewing what is happening in the market If you really follow this, no conservative investor for many years if you have some kind of short-term interest or in conservative investments you want to choose a more accurate time to enter and other things.
Then carefully monitor the reporting season In my opinion, this is now quite critical How to make trading decisions in trading what skills active investors should have what techniques to master How the news flow affects the market How to identify new trends in the market and the time of their reversals what is the place of Technical analysis in decision-making processes what are trading corridors how to find the bottom of the market according to trading signals book by financial analyst and investor Peter Pushkarev the art of being peaceful for traders and investors who want to find answers to these and other questions, the material is built on the basis of trading experience in the foreign exchange market. However, the same principles, approaches, and techniques are applicable to the classical stock market.