The recovery in 10-year Treasury rates and some positive stories coming from the US quarterly front confirm the recovery on Wall Street, which continued throughout the week after last Monday’s sharp thud, which saw the Dow Jones collapse by 700 points, suffering the strongest daily decline since October 2020.
At around 12.25pm, Dow Jones futures rose 0.44% to 34,860 points; Nasdaq Composite futures advanced 0.51% to 15.004 points, while S&P 500 contracts advanced 0.47% to 4.380 points.
Yesterday, the US indices ended a session characterized by weakness: the Dow Jones rose by just 25.35 points (+ 0.07%), the S&P 500 reported an upward change of 0.2%, while the Nasdaq Composite it advanced by 0.36%.
The three indices are preparing to end the week in positive territory: on a weekly basis, the Dow Jones rose by 0.4%, returning to a value just below -1% compared to the new record to be reached. The S&P 500 gained 0.9% and the Nasdaq Composite was up + 1.8%.
The pre-market highlights the increases in FAANG shares such as Facebook, which benefits from the financial results of rivals active in social media; also go up Apple, Microsoft, Amazon and Alphabet which, together with the giant of Mark Zuckerberg, will publish their quarterly reports next week.
From the hi-tech world, good indications arrived yesterday, after the end of the trading day, with the financial statements of Snap and Twitter:
Snap stock rallies over + 16%, but has also flown over + 17%, after the company released a report that highlighted better second-quarter earnings, revenue and user growth of expectations. In particular, the adjusted earnings per share amounted to 10 cents, compared to the 1 cent loss per share forecast by the analysts interviewed by Refinitiv. Revenue was $ 982 million, better than the expected $ 846 million, while global daily active users stood at 293 million, better than the 290.3 million estimated by the State Street consensus. Snap ended the second quarter with 293 million daily active users, up nearly 5% from the 280 million reported in April and more than 23% from 238 million users in the second quarter last year.
Twitter also did very well: the adjusted net profit of the company managed by Jack Dorsey amounted to 20 cents per share, compared to the 7 cents expected by the analysts interviewed by Refinitiv. Revenue was $ 1.19 billion, better than the consensus projected $ 1.07 billion and up 74% year-on-year. The pace of revenue growth was the highest since 2014.
Advertising revenue from Twitter jumped 87% year-on-year to $ 1.05 billion, compared with daily monetizable active users of 206 million, up from 206.2 million forecast by analysts surveyed by StreetAccount.
After its loss in the second quarter of 2020 of 1.38 billion, Twitter ended the second quarter of 2021 with a net profit of $ 65.6 million. In afterhours trading, Twitter prices have flown up to + 9%, now they are showing a very solid rise, equal to + 5.75%.
More than the balance sheet, Intel’s guidance on gross margin disappointed.
The American chip giant announced that it ended the second quarter of the year with a net profit of $ 51 billion, down 1% compared to the profit collected in the same period of 2020. The net profit per share was attested at $ 1.24, up 4% yoy. On an adjusted basis, eps was $ 1.28, up 12% yoy and above the expected $ 1.06 per share. Adjusted revenue amounted to $ 18.5 billion, up 2% year-on-year, better than the estimated $ 17.8 billion.
On the back of its balance sheet results, Intel revised its 2021 adjusted revenue guidance upward by $ 1 billion to $ 73.5 billion, versus an eps of $ 4.80.
Intel’s findings suggest that the boom in computer sales that began with the Covid-19 pandemic could continue as people return to school and offices.
However, the stock loses pre-market after the chip giant said it expects non-GAAP gross margin of 55% for the third quarter of the year, down sharply from 59.2% in the second quarter.
Intel explained the decline in margins with the restrictions that are hitting the offer and with the costs associated with the production of chips with the adoption of a new technology. The prices are down almost 2% in the premarket.
On the other hand, Didi is not doing well at all, with the ADRs losing more than 8% after the fall on Wall Street equal to -11%. According to Bloomberg reports, the Chinese authorities are planning an even higher penalty than the record one paid to Alibaba of $ 2.8 billion. But the penalty against Didi could be even higher: Beijing is in fact thinking of forcing the company to delist.
On July 16, officials from seven Chinese government agencies raided the offices of the ride-sharing giant.
Officials conducted an inspection to identify any cyber security risks.
One of the agencies, the Cyberspace Administration of China (CAC), had already accused the company of illegally collecting its users’ data. Along with China’s leading antitrust authority, the State Administration for Market Regulation (SAMR), the CAC is among the seven agencies that have raided Didi’s offices in China.
Chinese firm Didi Chuxing landed on the New York Stock Exchange on June 30, launching one of the largest US IPO deals in the past decade.
Focus on US Treasury rates, with 10-year rates rising as high as 1.29% in the past few hours, after plunging to a five-month low to 1.13% earlier in the week, in what could be renamed the Black Monday, due to the escape from the stock market. Escape from equities parallel to the hoarding of Treasuries, fueled by the renewed fear of the Covid-19 pandemic, due to the worldwide spread of the Delta variant.