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| This week's gainers and losers |
| Gainers : Burford Capital (+24%): In a long-running case, a US court has found Argentina guilty of failing to make a public offer for securities held by two Burford clients in the YPF renationalisation dispute. "This is a victory for Burford. A positive cash outcome is now very likely, although it will probably be years before that happens," commented Julian Roberts at Jefferies. Apellis Pharmaceuticals (+17%): The US biopharmaceutical company is seen as a potential takeover target for larger companies. The company, which develops ophthalmic products, could also consider seeking partnerships or licensing agreements. UnitedHealth (+7.6%): The largest health insurer in the United States - and the largest weighting in the Dow Jones - benefited from a more favorable measure than expected for the Medicare programme. At the end of last week, the CMS decided to increase payment rates by 3.3% in 2024, compared with a previous expectation of 1.1%. Exxon Mobil (+6.6%): Oil companies, including the US major, had a good week. The countries of the Opec+ cartel announced last Sunday that they were going to reduce their production by 1.66 million barrels per day to better balance supply and demand... and support prices. Losers : C3.AI (-41%): The US company that develops artificial intelligence software fell more than 26% on Tuesday after a short seller's review highlighted serious accounting and transparency issues. Kerrisdale Capital, the company in question, claims that C3.AI used accounting to inflate its income statement numbers to meet analysts' estimates. The company has not yet responded to the allegations. Plug Power (-18.9%): Shares of the hydrogen technology player fell after it received a downgrade by Morgan Stanley to Hold from Buy. His price target was lowered 57%, to $15 a share. Morgan Stanley cited concerns that sales and profit margins might not improve as fast as expected. Tesla (-10.9%): Deliveries in the first quarter were up 36% compared to the same period last year. However, this performance was below the expectations of Refinitiv analysts who were expecting 430,000 vehicles after successive price cuts. Elon Musk's company delivered only 422,875. For the whole of the current financial year, Elon Musk has set a target of a 52% increase in sales. |
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| Commodities |
| Energy: OPEC+ shook markets earlier this week, with an unexpected cut in black gold production of up to 1.66 million barrels per day in the coming weeks. This of course caused Brent crude oil to rise to USD 84.6 on Thursday afternoon, up from less than USD 80 the previous Saturday. This voluntary production cut is said to be motivated by the desire to support the stability of the oil market. Oil prices rallied at the beginning of the week, only to fall slightly, mainly due to investors' caution about risky assets with an economic slowdown in sight. The power of OPEC+ countries over oil is currently greater than before. This is due to the weakness of the US Strategic Petroleum Reserve (SPR), which can no longer easily exert pressure on market share. This tightening of the market by the cartel could create an imbalance with demand, thus creating more volatility in the long term. Metals: Gold broke back through the symbolic USD 2000 mark this week, after a strong rally. The precious metal, which is considered a safe haven, is benefiting from increased fears about economic dynamics. It consolidated its positions slightly at the end of the week. Agricultural products: The Egyptian General Authority for the Supply of Raw Materials launched an international tender, seeking to buy wheat from all origins. This diversification follows Egypt's low wheat imports for the season through June, compared to estimates (10 million tonnes versus 11 million by the USDA). This figure is historically low, due to the lack of foreign exchange and the war in Ukraine. This week saw the resumption of the weekly US crop progress reports. Variations in planting weather will set the course for the future. |
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| Macroeconomics |
| Atmosphere: Swirling wind. The deterioration of US macro statistics and the banking crisis have reinforced investors' hopes for medium-term monetary easing in the US. But they have also raised fears of a hard landing for the economy. This week, it is these fears that have taken over after a string of unfavorable data. The next expected statistics (inflation, consumption, confidence) will have considerable weight in the strategy that the US central bank will choose to apply at its meeting on May 3. Currencies. The US dollar fell after the release of disappointing economic data. The figures helped to cement the USD 1.09/EUR 1 area. The same was true of the yen, whose strengthening has hurt Japanese equity markets this week. The pair was trading at JPY 131.4 per USD on Thursday. However, the greenback regained some ground at the end of the week, with the Dollar Index (DXY) at 102. Investors are awaiting Friday's US jobs report to fine-tune their forecasts. The euro lost some ground against the franc to CHF 0.9874. Rates. The reaction to the JOLTS (Jobs opening) earlier this week was a turning point. For the first time in two years, the report revealed a drop of 632,000 job offers below the symbolic 10 million mark. Until now, any weakness in the job market would have been met with a rise in equities as it would have meant that the Fed could start to ease monetary policy. In this case, we have seen the more traditional "flight to quality" with a rise in bonds (lower yields) accompanied by a fall in stocks. It seems that operators are starting to seriously consider the recessionary scenario. As an immediate consequence, the US 10-year yield is breaking out of the distribution phase it has been in since last October by breaking its support at 3.35%. Cryptocurrencies. Bitcoin is down slightly by -1.2% this week and is back below $28,000 at the time of writing. For its part, ether, the second largest cryptocurrency in terms of market capitalisation, is taking on the leader by climbing 4% since Monday. Nevertheless, still lacking strong positive catalysts, digital currencies remain globally dependent on economic conditions and will therefore remain sensitive to upcoming economic statistics. Calendar. Several markets were closed on Friday and some will still be closed on Monday, including Paris, Frankfurt, Zurich and London. New York, on the other hand, will resume on Monday. We will have to wait until Wednesday 12 to see the first macroeconomic highlight of the week, the announcement of US inflation for March. This will be followed in the evening by the publication of the minutes of the latest Fed meeting. On Thursday 13, the US producer prices for March will be released before the main event on Friday, the combination of retail sales and the University of Michigan consumer confidence index on Friday 14. In a market that is looking to understand what growth and monetary policy will be made of in the months to come, this week will bring some prime data. Outside of the US, investors will keep an eye on Chinese inflation (Tuesday) and European industrial production (Thursday). |
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*The weekly movements of indexes and stocks displayed on the dashboard are related to the period ranging from the open on Monday to the sending time of this newsletter on Friday. The weekly movements of commodities, precious metals and currencies displayed on the dashboard are related to a 7-day rolling period from Friday to Friday, until the sending time of this newsletter. These assets continue to quote on weekends. |
