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US markets rebounded for the fourth consecutive trading day

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Asia markets are expected to rise despite some massive share price falls in Meta Platform and PayPal in after-hours trading in the US. Alphabet and Advanced Micro Devices led tech share gains and helped US markets higher during the day after better-than-expected quarterly earnings. SPI futures are only slightly higher, but the NZX 50 is up 0.5% in the first half-hour on Thursday.

US stocks

US markets rebounded for the fourth consecutive trading day, with the Dow Jones Industrial Average up 0.62%, the S&P 500 rose 0.94%, and the Nasdaq gained 0.5%.

Mega cap tech companies posted strong fourth-quarter earnings. Alphabet’s shares surged more than 8%, to near a record high after the company reported strong revenue growth and announced a 20-for-1 stock split. Advanced Micro Devices jumped 5% after the chipmaker beat expectations and gave positive full-year guidance. Apple was up 0.72%, and Microsoft gained 1.57%.

Meta Platform rose 1.4% before its earnings report, but shares plunged more than 20% in after-hours trading due to worse-than-expected guidance for the first quarter.

PayPal shares lost more than 24% on disappointing guidance. Shares are 57% down from their record high.

The ADP non-farm employment data disappointed, with jobs down by 301,000 in January, which points to weak growth in job creation data due on Friday. Goldman Sachs now forecasts a drop of 250,000 in January. The data indicates rising hiring costs and a shortage of workers are slowing the labor markets, while inflation remains an issue.

Treasuries

The US bond yields fell with the weak employment data. The 10-year US Treasury yield fell to 1.773% from 1.804, and the 2-year Treasury yield was down to 1.158%.

Commodities

The WTI futures rose slightly to $US88.31 a barrel after top oil-producing countries led by Saudi Arabia and Russia announced another modest increase in output on Wednesday despite soaring crude prices and geopolitical tensions rattling the markets.

The 23-nation OPEC+ group said in a statement that it will increase production by 400,000 barrels per day in March, the same amount as in previous months.

The group, which includes the 13 members of the Saudi-led Organization of the Petroleum Exporting Countries (OPEC) and their 10 allies, including Russia, has resisted US pressure to further boost production to tame prices.

The gold futures price was up by another $US5.50, to $US1,806.60, supported by a weaker US dollar.

Currencies

The US dollar index fell for the third straight trading day due to falling bond yields and a stronger Eurodollar. The dollar index fell 0.44%, to 95.945, and down 1.6% from its January high at 97.440. The Eurodollar was up 0.33% against the US dollar after the region recorded higher-than-expected CPI data at 5.1%, which strengthened the expectation for the ECB to be more hawkish at its meeting tomorrow.

Cryptocurrencies

Cryptocurrencies fell in general after three days of gains. Bitcoin was down 4.17%, to just above $US37,000, and Ethereum slid 4.77%, to $US2,656. 


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