In today’s top stories, AMD discusses its next-generation gaming processors, hedge funds increase bets on healthcare stocks and China’s property market slowdown send lenders’ shares tumbling. Meanwhile, Goldman sees opportunities in commodities and energy funds jump despite a gloomy outlook for Europe’s energy sector.
AMD unveils next-generation processors
Gaming market conditions may be challenging right now, but AMD [AMD] has launched its next line-up of processors: the Ryzen 7000. As well as reportedly being the fastest in the world, the chips are also the first generation to have integrated graphics. AMD CEO Lisa Su told an event on Monday that the Ryzen 7000 series boasts stellar gaming performance. The processors will launch at the end of September.
China’s property market slowdown
One of China’s largest property developers, Country Garden Holdings [2007.HK] reported on Tuesday that its earnings plummeted 96% in the first half of the year. Concerns about a property market slowdown have gripped Chinese lenders — two of the biggest, China Merchants Bank [600036.SS] and Ping An Bank [000001.SZ] — are down 31.1% and 25.4% respectively year to date.
Goldman says buy commodities over equities
Raw material prices have been declining to an attractive level, according to Goldman Sachs analysts Sabine Schels and Jeff Currie. In a note to clients seen by Seeking Alpha, they explained that agricultural and industrial commodities have been dragged down by the market pricing in recessionary risks. But with the likelihood of a recession outside Europe in the next 12 months being “relatively low”, it makes sense to “buy commodities now, worry about recession later”.
European energy powers on
The EU is heading for a dark winter if action isn’t taken on the energy crisis, European Commission president Ursula von der Leyen warned on Monday. Ideally, the bloc should cap prices in the short term and work towards cutting the link between gas and electricity costs in the long term, she said. The iShares MSCI Europe Energy Sector ETF [ESIE] continues to power on despite the news, up 3.7% in the past week and 10.4% over the past month.
Hedge funds bet on healthcare
Payments processor Visa [V] has become a popular pick among hedge funds looking to beat market volatility, according to data compiled by InsiderScore and seen by CNBC. KBW analyst Sanjay Sakhrani said its “fundamentals exhibit both offensive and defensive attributes”. A data set of 600 hedge funds with total holdings of $756bn have also been adding a number of healthcare stocks, including Biohaven Pharmaceutical [BHVN], Eli Lilly [LLY] and Thermo Fisher [TMO].
Earnings preview: ChargePoint
ChargePoint shares have struggled to regain the positive momentum it saw in early 2022. However, the charging network stock was trending higher in early August after the Biden administration passed the climate bill, giving it a much-needed boost ahead of its earnings report announcement after market’s close today. The company is predicting Q2 revenue to sit between $96m and $106m as it anticipates further increased demand.
Earnings preview: Lululemon
Athleisure brand Lululemon has seen its share price tumble so far in 2022, as consumer confidence slips amid the cost of living crisis. Despite broad market headwinds for consumer discretionary stocks, analysts forecast the company to report positive revenue and earnings growth for the second quarter. Zacks Investment Research expects revenue to grow 22.1% year-over-year to $1.77bn, while earnings are estimated to reach $1.86 per share.
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