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Wednesday, July 24

Some of the largest macro moves in the market today include: Nasdaq 100 Index (US) -1.7%. S&P 500 Index (US) -1.0%. USD/JPY -1.2%. Some of the largest moves among US mega-cap stocks include: Tesla Inc (TSLA) -9.0%. Alphabet Inc (GOOGL) -4.4%. Alphabet Inc (GOOG) -4.3%. 

Recent economic data releases have highlighted a slowdown in the Eurozone, with Germany's Composite PMI falling to 48.7 and France’s Manufacturing PMI dropping to 44.1, indicating contractions in private sector business activity for both countries. This has contributed to declines across major European equity indices such as the DAX and CAC 40.

In the United States, wholesale inventories rose by only 0.2% month-over-month in June, below market expectations of a 0.5% increase which suggests slower inventory accumulation than anticipated; this follows recent reports showing declining mortgage applications despite lower interest rates.

Global markets are also reacting negatively to disappointing earnings from key companies like Tesla and LVMH alongside concerns about global business sentiment impacting equities broadly including significant drops seen on US indices such as Nasdaq-100 down over -1%.

SPY [-0.9%]
The SPDR S&P 500 ETF Trust is moving lower in line with the broader market, influenced by significant drops in top holdings like TSLA, GOOGL, and GOOG. TSLA reported Q2 earnings missing estimates, while GOOGL faced concerns over AI investments impacting margins. The market's volatility, potential Fed rate cut, and cooling inflation also play a role in the ETF's -0.7% change, reflecting overall market sentiment impacting equities.

DIA [-0.4%]
SPDR Dow Jones Industrial Average ETF Trust (DIA) moved down by -0.4% in pre-market trading, aligning with the S&P 500 Index's -0.78% decrease. Top contributors to DIA's performance included V, MSFT, GS, CRM, and AXP, with Visa Inc. experiencing a 3% stock price drop due to a revenue miss. Market sentiment may be influenced by global PMI data and the CNN Business Fear & Greed Index shifting to "Neutral," impacting investor behavior towards stocks. The US Dollar's dynamics and expectations of a Federal Reserve rate cut in September could also affect the index, with a focus on economic indicators like PMI and GDP figures for further insights into market conditions surrounding DIA.

V |-4.1%|-20.8B
Visa Inc saw its stock price drop over 3% in pre-market trading after slightly missing Q3 revenue estimates, with earnings at $2.42 per share and revenue slightly below expectations at $8.9 billion. Despite this, Visa reported strong growth with a 7% increase in payment volume, a 14% rise in cross-border volume, and a 10% surge in processed transactions for the third quarter, reflecting a robust recovery in consumer spending and a growing reliance on digital payments accelerated by the pandemic. The company's CEO emphasized net revenue growth of 10%, GAAP EPS growth of 20%, and non-GAAP EPS growth of 12% during the quarter, highlighting stable business drivers and new innovations driving the future of commerce.

TSLA | -8.6% | -62.0B
Tesla Inc experienced an -8.1% price drop since the previous close, coinciding with Elon Musk's emphasis on Full Self-Driving, autonomy, and fleet during the recent call, noting delays in Robotaxi events unveiling. Despite lower-than-expected EPS at $0.52 and concerns over profit margins post-Q2 results, revenue surpassed estimates at $25 billion. The Nasdaq 100 Index decreased by -1.36%, potentially impacting Tesla's decline in the market. Tesla remains committed to new vehicle production plans starting in H1 2025, including more affordable models, amidst ongoing challenges in profitability due to increased spending on AI projects.

T |+3.5%|+4.7B
AT&T Inc's stock price rose by 2.8% after the release of its second-quarter results, showing strong financial performance with net income of $3.9 billion, adjusted EBITDA of $11.3 billion, and free cash flow of $4.6 billion. The company exceeded expectations in key metrics like postpaid phone net additions and reaffirmed its full-year outlook and adjusted EPS growth for 2025. Despite falling slightly below estimates in total revenue, AT&T remains focused on growth areas such as wireless service revenue and broadband revenue, while emphasizing the expansion of its fiber network and achieving specific financial targets by 2025.

GOOG |-4.2% | -91.7B
Alphabet Inc experienced a -3.8% change following its second-quarter earnings report release, despite surpassing revenue and earnings per share estimates. The stock dropped in after-hours trading, reflecting the broader sector's downward movement. CFO Ruth Porat highlighted investments in AI and cost optimization, while CEO Sundar Pichai emphasized innovation in AI. The decision to maintain cookies in Chrome was discussed amidst regulatory scrutiny, and a $5 billion investment in autonomous driving technology unit Waymo was announced, drawing reactions from Tesla CEO Elon Musk. The Nasdaq 100 Index also moved negatively, showing a mild correlation with GOOG's price decrease since the previous close.

DB |-5.9%|-1.9B
Deutsche Bank AG's stock price dropped 5.8% premarket, coinciding with a reported second-quarter net loss of EUR143 million, missing estimates, despite a 2% revenue increase to EUR7.59 billion. Concerns arose as the bank raised guidance for loan losses due to commercial real estate exposure exceeding 30 basis points. The CET1 ratio improved to 13.5%, potentially paving the way for a share buyback program in 2025. Additionally, a significant decrease in Q2 profit to €52M from €940M and the end of a 15-quarter profit streak were noted, with shares plummeting by 8% following a provision linked to a Postbank lawsuit alleging underpayment during an acquisition in 2010.

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