Mixed Trend in Europe as Shipping Giant Maersk Sees a 14% Drop in Share

Today’s Trade Overview: Current reports, market trends, indices, stock prices, bonds, foreign exchange, commodities, and analyst recommendations

11:02

Trading in Europe currently sees minimal changes. Leading indices such as the DAX, KAC, and POTSI are trading around their base rates.

Maersk, the Danish shipping giant’s shares, have fallen by 14% following the suspension of its share buyback plan. The suspension is a response to situations in the Red Sea, causing “great uncertainty” for the company’s 2024 earnings. Disruptions in the Red Sea are expected to impact the shipping industry significantly.

10:20

European stock markets opened with a positive trend. The Dax and Potsi increased by 0.1%, while the French CAC increased by 0.2%. Meanwhile, Asia saw a mixed trend this morning with Shanghai increasing by 1.3%, Hang Seng decreasing by 1.33%, and the South Korean Kospi increasing by 0.41%.

08:32

Asian stock exchanges mostly saw a price increase this morning. The Nikkei rose by 2.1%, the Shanghai index by 1.1%, the Hang Seng index fell by 0.9%, and the Kospi rose by 0.3%. Futures are trading with minimal changes around base levels this morning.

Wall Street closed last night with price increases. The Nasdaq Index rose by 0.95%, the Dow Jones by 0.4%, and the S&P 500 by 0.8%. The S&P 500 reached a price of 4,998, coming close to the 5,000 mark for the first time ever.

Jefferies Investment Bank published a recommendation on Similrv shares. The Israeli company saw a 12% increase following the recommendation, with the bank suggesting that the stock is “too attractive to ignore”. The bank has resumed its review of the stock with a “buy” recommendation and a target price of $10, a price 50% higher than the stock’s current price on the Nasdaq.

Anphase Energy shareholders received good news when the company reported its fourth-quarter results. The company’s business weakness caused a 50% decrease in the company’s market value over the last year. However, the company’s CEO, Bardi Kothanderman, announced signs of recovery in Europe and expects the same in the US. The company’s stock jumped by about 20% last night.

New York Community Bancorp is working to restore investor confidence by reporting that its collateral, liquidity, and loans are in good and safe condition. This follows Moody’s credit rating agency downgrading its credit rating to “junk”.

Snap’s stock plunged by over 30% yesterday after its financial results were published. In contrast, Ford Motors stock rose approximately 6% after surpassing analysts’ profit and revenue forecasts.

Softbank reported its first quarterly profit after four loss-making quarters, albeit slightly lower than analysts’ expectations. This was mainly due to its investment arm Vision Fund. Sales stood at 1.77 trillion yen with a profit of 950 million yen.

The British chip company Arm’s stock soared by 20% in late-night trading following positive Q4 reports. As a result, Softbank, which owns about 90% of Arm’s shares, recorded a profit of 16 billion dollars, effectively erasing its 14 billion dollar losses on WeWork.

News Corp and Walt Disney also published encouraging reports after the close of trading.

Bill Ackman, who heads the Pershing Square Capital Management hedge fund, is set to launch a new fund on the New York Stock Exchange. This allows Ackman to reach a wider audience of Wall Street investors. The fund will be a closed fund and invest in 12-24 large American companies on Wall Street with a high investment grade and sustainable growth. If approved, its ticker will be PSUS. A similar fund aimed at foreign investors and registered in Europe achieved a 27% return in 2023.

Yesterday saw demands registered in the debt market. The ten-year government bond yield decreased by 2 basis points to 4.13%, and the two-year bond yield decreased to 3.76%. Corporate bond indices rose by 0.2%.

US bond yields rose by approximately 0.5% – the 10-year government bond traded at 4.1%, the two-year yield rose to 4.4%.

Oil prices are increasing in the commodities market: a barrel of the Brent type traded at $79, crude oil traded at $74 per barrel. The price of gold weakened, an ounce traded at $2,050.

China released its inflation data for January, showing a decrease of 0.8% on an annual basis, compared to a decrease of 0.3% the previous month. Expected decrease was only 0.5%. On a monthly basis, prices decreased by 2.5% compared to an expected decrease of 2.6% and a decrease of 2.7% in the previous month. China is still experiencing deflation (falling prices), which indicates the weakness of private consumption there.

Ronan Menachem, Chief Markets Economist at Mizrahi Tefahot, commented on the data from China: “We are witnessing the beginning of a year that does not bode well for China’s economy. Not only is it the second largest in the world, but it is also one of the main engines identified for the global economy recovery this year. The consumer price index registered an annual decrease of 0.8% in January – the sharpest decrease in four months. This is the longest sequence of declines since October 2009 and it is important to note that economists estimated that the index would register an annual decline of only 0.5%.”

“The severity of the situation is evidenced by two figures: the International Monetary Fund estimated only three months ago that inflation in China would be 1.7% this year, and the Chinese authorities themselves set a target of 3% for last year and will likely repeat it this year.

Rafi Gozlan, the chief economist at IBI, refers to the issues of inflation and interest rates in the US, and says that the macro data raises questions about the continued weakening of the inflation environment in the American market. “Sensitivity to the inflation data will be higher in the coming months. The Federal Reserve (the central bank, Fed) tipped the balance of the factors influencing policy in favor of activity, at the expense of inflation.”