Walmart gains on strong earnings and guidance
Shares of Walmart rose more than 1.5% in premarket trading after the retail giant on Thursday raised its full-year forecast and reported an almost 8% gain in sales for the fiscal first quarter, pointing to strength in its large grocery business that helped offset weaker sales in clothing and electronics.
Walmart also reported stronger-than-expected adjusted earnings and revenue, according to Refinitiv.
— Tanaya Macheel, Melissa Repko
UBS Global Wealth Management sees three reasons to buy gold
Gold prices dipped slightly Thursday, as investors grew optimistic that U.S. lawmakers could reach a deal to raise the debt ceiling. However, UBS Global Wealth Management is still bullish on the precious metal, citing three reasons:
- "Central bank demand should remain robust:" Mark Haefele, CIO at UBS Global Wealth Management, said 2022 was the 13th straight year that central banks were net buyers of gold, and demand is unlikely to let up anytime soon. "Based on the 1Q23 data from the World Gold Council, central banks are on track to buy around 700 metric tons of gold this year, much higher than the average since 2010 of below 500 metric tons," he wrote.
- Dollar weakness: The dollar index, which tracks the U.S. currency's performance against six others, is down 0.4% year to date, which should be supportive for gold prices. "The direction of a weakening dollar is clear, with the US Fed having signaled a pause in its current tightening cycle after 500 basis points of rate hikes over the past 14 months," Haefele wrote.
- Recession risk: "Overall, recent data coming out of the US showed the country's growth is slowing, with weaker-than-expected 1Q GDP, six consecutive months of contracting manufacturing activity, and the weakest consumer sentiment since November," according to UBS.
— Michael Bloom, Fred Imbert
European equity markets open higher
European markets opened higher Thursday as U.S. debt ceiling talks make progress.
The pan-European Stoxx 600 index was up 0.3%, with most sectors trading in positive territory. Auto stocks led modest gains with a 0.9% uptick, followed by tech, which was up 0.7% at the start of trading.
European markets
— Hannah Ward-Glenton
Sony shares surge 6% as it eyes separate listing for financial unit
Japanese conglomerate Sony Group is mulling a partial spin off of its financial business in the next two to three years.
Sony said that this will be on the consideration that the group will continue to own a portion - slightly less than 20%, Sony says of the spin off.
This is "so that the financial services business can continue to utilize the Sony brand, and continue to generate synergies with Sony Group companies after the execution of the spin-off."
The financial unit reported a revenue of 1.45 trillion yen ($10.74 billion) in the financial year ended March, while operating profit came in at 223.9 billion yen for the full year.
Shares of Sony closed 6.4% higher on Thursday.
— Lim Hui Jie
Japanese stocks extend winning streak, led by energy and technology stocks
Japanese markets extended their winning streak on Thursday, with the Nikkei 225 leading gains in the region and continuing to trade above the 30,000 mark.
The Topix maintained levels not seen since August 1990.
Energy and technology stocks led the Topix, with its top gainers being Sony and electronics company Tokyo Electron.
Meanwhile, Factset revealed that electronics stocks powered the Nikkei, with the top gainer on the index being semiconductor test equipment manufacturer Advantest, followed by Tokyo Electron.
— Lim Hui Jie
Shares of Tencent slide over 3% despite better first quarter results
Shares of Chinese tech giant Tencent in Hong Kong have slid over 3% even as the company reported an 11% jump in quarterly revenue to 150 billion Chinese yuan ($21.4 billion)
This marked its fastest growth in more than a year, as the company saw a big rebound in payment volumes, ad sales, and gaming.
Net profit climbed 10% to 25.8 billion yuan, lower than than the 31 billion yuan expected by economists polled by Reuters.
— Lim Hui Jie, Ryan Browne
Nomura downgrades China's full-year growth forecast
Nomura downgraded its China full-year growth forecast from 5.9% to 5.5%, according to a Wednesday note.
"China's post-Covid recovery has been rapidly losing steam," Nomura's Ting Lu wrote, noting that the latest activity data and high frequency data in May show the momentum has been losing steam "due partly to weak confidence among consumers and business investors."
"As disappointment kicks in, we see a rising risk of slower activity growth, rising unemployment, persistent disinflation, falling market interest rates, and a weaker currency," he wrote.
Nomura added that it is also cutting its 2024 full-year gross domestic product forecast for China from 4.4% to 4.2%. It now expects the second quarter's GDP to grow 7.8%, third quarter to grow 4.9%, and the final quarter of the year to grow 5.0%.
– Jihye Lee
Japan trade deficit narrows in April, imports fall more than expected
Japan's trade deficit has narrowed by almost half in April, falling to 432.41 billion from 854.93 billion a year ago.
Most notably, imports fell by 2.3% year on year, more than the 0.3% expected by economists polled by Reuters.
Exports came in largely in line with expectations, rising 2.6% year-on-year compared to the 3% expected.
— Lim Hui Jie
The Russell 2000 closed above its 50-day moving average for the first time since March
The three major averages weren't the only indexes that had a strong session during Wednesday's trading. The Russell 2000 – the small cap benchmark — surged 2.21% to close above its 50-day moving average of 1,765.83, a first since March 8.
The smaller firms that make up the 2,000-stock index are especially sensitive to the economic cycle. The 50-day moving average, meanwhile, is important for chart technicians: A close above that threshold can indicate that a positive trend for the index is unfolding.
Stocks leading the Russell 2000 higher Wednesday include National Western Life, Qurate Retail and Microvast.
-Darla Mercado, Gina Francolla
Stocks making the biggest moves after hours
Check out the companies making headlines in extended trading.
Take-Two Interactive Software — Shares jumped 8.1% Wednesday during after hours trading. The video game company reported $1.39 billion in adjusted revenue in the fiscal fourth quarter, topping analysts' estimates of $1.34 billion, according to Refinitiv. Meanwhile, the company's estimates for bookings in the first-quarter and full-year missed Wall Street's expectations.
Cisco Systems — Shares dipped nearly 4% despite the company reporting an earnings and revenue beat for the fiscal third quarter. Cisco posted adjusted earnings of $1 per share and $14.57 billion in revenue. Analysts had estimated 97 cents earnings per share and $14.39 billion in revenue, according to Refinitiv.
The full list can be found here.
— Hakyung Kim
Stock futures open flat
Stock futures gain for a second day on strong Walmart earnings, debt ceiling deal hope: Live updates - CNBC
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